Wait! We voted for more taxes on land owners not renters, why are the rents going up!?!
Vox is a dumpster fire and the owners have been hyperbolic rage bait farmers for over a decade.
Vox is a dumpster fire and the owners have been hyperbolic rage bait farmers for over a decade.
But more importantly, the part where you speak of "state taxes" makes me think you have no idea what you're talking about, since the original idea of Henry George was to distribute the LVT in the form of a citizen's dividend, equally among every person regardless of any criteria. A prescient form of UBI if you will.
As of the time of writing we do pay taxes on land as well as taxes on labor, taxes on commerce, taxes on investments, taxes on inheritance, taxes on imports, taxes on value added to goods, sin taxes, tax stamps for government services, taxes on energy, taxes on roadways, taxes on gifts, taxes to enter or leave airports, and even taxes to live in certain cities. In the US these did not exist until after the civil war and since then they've become the rule and not the exception, to repeal all of them and replace them with a LVT is great, but to expect the modern state to not feature creep every single one of the current taxes back in place within a few decades gives me a huge pause.
As grandparent said, every tax causes this kind of incentive. So people thought long about what was the least worst of all the options and came up with LVT and similar ideas. They cause the minimum harm to the economy and have the least side effects and "unintended consequences"
It forces landowners to account for the opportunity costs they impose on society by not utilizing the land optimally, even if (and especially if) those costs change over time.
https://www.gameofrent.com/content/can-lvt-be-passed-on-to-t...
The best empirical evidence available shows pretty strong signs that land value taxes are not passed on to tenants
If property taxes are raised and my mortgage/interest/tax payment are now 1350$ you will raise rent accordingly unless you are running a charity or expect a roof to repair itself. I don't need a theoretical analysis from a game developer who has to imagine himself as a landlord as I have personally owned rental property before, have known people who have owned rental property and rented property before.
Great, because I didn't provide you with a theoretical analysis, I provided you with an empirical analysis that actually looks at the evidence from the real world.
Regardless of my credentials or your credentials, I'm not particularly impressed with anyone who cites an N of 1 from their own personal experience and thinks it proves anything in particular.
That's rich. As someone who is a landlord, I'm already charging what two owners ago was charging when they died and the city won't let raise the rent because of COVID and beyond that, there is a rent stabilization ordinance which will never allow my rents to catch up to market rate.
I would like to see zoning fixed before we add more market distortions. This really doesn't account for the cost of construction as well. If you have a property that can earn $2,500 per unit, and it costs $300k, you can break even in $10 years. Now the government is taking half, it takes 20 years to break even. You just eliminated people who would invest in new housing. Does the LVT magically affect construction costs?
So then land gets cheaper because the government is taking half the potential revenue (not even profit, which makes renting incredibly unprofitable considering expenses). What stops wealthy people from just buying it as single family homes then? You have just lowered the price of the land, so they will come in a scoop it up.
It seems insane to me that we have these distortions that ruin the housing market (zoning, rent control) and the answer is to add another distortion (LVT) rather than eliminating the ones currently in place. You're disincentivizing people from renting their land if you cut into the profit of doing so. Make building not a bureaucratic nightmare and I will build. Revoke RSO and I won't shut down my property and convert it to a SFH for myself.
On the other hand if you renovate a building and now can charge twice as much for rent, that hardly effects the land value at all -- it's one building in the area, it won't have a huge effect generally on the land value of adjacent buildings. So you'd get to reap the rewards of your work -- you improved the property and now get to make money from that improvement. LVT explicitly does not tax improvements, only the site-value of the land.
I'm certainly for eliminating rent control and massively liberalizing land use (you may still need very broad classes of zoning, ala Japan with 12 total zones all of which allow mixed use and multi-family dwellings and non of which except industrial zones restricts the minimum size/use in an area, but my preference would be to just have a separation between industrial and non-industrial use cases). That would help a lot! But it doesn't address the fact that when for instance Los Angeles installed the Expo Line for ~$3.5B the people who owned apartments nearby suddenly got a massive 20+% boost in the rent they could charge, a total value of which would have been large enough to pay for the line's construction & operation!
The value of that public investment ought to have come back to the city to be spent on yet more improvements, not pocketed by private property owners who happened to buy a building nearby a decade or more earlier.
>You didn't make that happen basically at all but get to reap the rewards.
The landlord did make that happen by making their property available for rent to others. Rents would be even higher if they took it off the market. Don't forget who owns the land.