My main issues with vacancy taxes are three-fold:

1. The cities with the worst housing crises are typically the ones with the lowest vacancy rates. This makes sense, as if vacancy rates are super high, potential tenants have a lot of negotiating power against landlords, so they can demand lower rents. When there are very few vacancies relative to the number of prospective tenants, landlords have all the negotiating power and can demand high rents.
2. Vacancy tax focuses on shuffling ownership of existing units and doesn’t do anything to encourage densification and development. Own a detached single-family home right next to a metro station in the middle of Manhattan? So long as someone lives in it, you pay no vacancy tax, despite the fact it’s clearly a massive waste of some of the most valuable land in the world.
3. It’s easier to evade and thornier to implement. For instance, there are a lot of “statistics” thrown about regarding “millions” of vacancies, but many on-paper vacancies aren’t what you or I imagine. For example, “vacant” technically includes student apartments where the student lists their parents’ address as their permanent address. Getting back to the point, if you can just on-paper claim a unit is occupied, you can evade the tax, which means the government then needs to actually go out and check if someone us actually living there at least 180 days out of the year, which is way harder to enforce.

Altogether, vacancy taxes are a pretty marginal solution, and I think our focus is much better spent on land value taxes and YIMBYism (e.g., zoning reform).

A 2nd property should be taxed at a higher rate regardless.

This can probably answer your questions.

A key idea of land value taxes is it’s on land value, rather than land area. Urban land is faaaaar more valuable than urban land on a per-acre basis, so someone who owns 1 acre of land in Manhattan will pay vastly more than a farmer who owns 1 acre in rural Nebraska.

As for appraisal, we already sorta do this with property taxes, as property taxes tax the land value + improvement value. With land value taxes, we simply seek to tax just the unimproved land value. Why? Property taxes can disincentivize development and incentivize land-hoarding and speculation. In contrast, even a milquetoast land value tax has been shown to reduce land speculation.

Okay but farmers already get so many subsidies that it wouldn’t at all be hard to write exceptions already built into the lower for them? Hmm.

What about Henry George, then?

Henry George (September 2, 1839 – October 29, 1897) was an American political economist and journalist. His writing was immensely popular in 19th-century America and sparked several reform movements of the Progressive Era. He inspired the economic philosophy known as Georgism, the belief that people should own the value they produce themselves, but that the economic value of land (including natural resources) should belong equally to all members of society. George famously argued that a single tax on land values would create a more productive and just society.

I’m not a fan of sales taxes, because they tend to be more of a burden on the poor than the rich. I much prefer a marginal income tax to that.

Personally, I think our philosophy of taxation should be “tax what you take, not what you make”.

Because there’s finite land on Earth and nobody has created it, you occupying any parcel of it necessarily denies others from its benefit. Hence, a land value tax in proportion to the value of land you have taken from the rest of society.

Similar for finite natural resources. There are finite mineral deposits, finite oil deposits, finite phosphate deposits, etc., and anyone who extracts them takes something from the rest of society. Hence, we ought to have a severance tax in proportion to the value of the resource you have taken from the rest of society.

And also similar for negative externalities. When you pollute a river or the atmosphere or cause any other negative externality, you are forcing those around you to bear some of your costs, that is you are taking value from them to give to yourself. Hence, we ought to have externality taxes (aka “Pigouvian taxes”) in proportion to the amount of harm you have caused to society.

Further, I think taxing along this principle leads to the best overall outcomes, not just from an abstract sense of “fairness”, but from pragmatic economic outcomes.

Take land value taxes: economically speaking, LVT is just a great tax with great properties that has seen great empirical success.

Or severance taxes: Norway has used them brilliantly to solve the resource curse.

Or Pigouvian taxes: basically all economists agree carbon tax-and-dividend is the single best climate policy.

But yeah, absolutely everything else should be tax-free. The government shouldn’t even be tracking your income, much less taxing you on it. Tax the land hoarders and polluters instead.

This will do the opposite of what you want. All of these policies disproportionately cause poor people to remain poor.

It’s not intuitive and it sounds great till you realize that unless you tax wealth and income with a progressive rate well into the 90% at the highest levels.

People who are wealthy don’t give a single shit about consumption tax. They also don’t care about transaction taxes (unless it’s progressive). A person with a million dollars doesn’t care if milk costs 5 bucks or 6 bucks a gallon… But the person making the minimum wage absolutely cares.

Sales tax is deliberately regressive, taxing the poor more than the wealthy. Why would you have it, rather than income tax?

http://gameofrent.com/content/can-land-be-accurately-assessed

The key downsides of income taxes, though, are it requires tracking everyone’s income, and it’s very easy to hide income by doing under-the-table work and getting paid in cash. In contrast, it’s impossible to hide land.

Last I heard my old landlord/friend was massively renovating the place, he stripped it down to the studs and I think he even added another floor to the building. He was redoing everything. At the time he was waiting on a permit to continue the work. He was putting in the time and effort to modernize and reduce his efforts long term. Hopefully that works out for him.

I hope your Tuesday delivery is smooth and that the new unit arrives undamaged in working order.

All the best.

I get it. I don’t agree that all landlords are bad, but many are.

I would support a raise in property tax that’s matched by a discount for primary residences. So most families will not see a difference, while people who own multiple homes and landlords need to pay more for taxes.

In addition, putting a cap on how much property a company can purchase in a year for the purpose of renting; as well as giving incentives for larger rental buildings like high-rises, since it can dramatically increase the amount of available units while preserving the amount of available property available for single family homes.

All of this would be to incentivize rental companies to build more large rental structures, instead of buying up a hundred homes and renting entire homes to people. IMO, renting an entire house should not be something that anyone can do (as in offering it as a rental). I know this has been what many do to try to reduce their overall spending, but bluntly, if instead, you can get an affordable home that you can mortgage for a similar monthly amount, then you’ll be far better off in the long run. If credit is a problem (poor credit, or a bad credit score, and/or no credit), then there’s rental units from high rises.

I just want to see the family homes given back to families to own… Not just rent and live in forever, never owning it and never having anything to show for it.

Unfortunately that view, if it ever came to be (and realistically, I don’t expect it will), would put my landlord friend out of business for renting, and bluntly, I would be unapologetic about it. Simply, the policies would ensure that homes are going to people who want/need them, and who will personally use them. I have every confidence that he would be fine since renting isn’t his only source of income. I believe both he and his wife have fairly well paying jobs. There was a time that they didn’t, and they needed the extra income from the rental house to make it, but I don’t think that’s really the case anymore.

Making it hard to impossible to maintain a rental property as an individual, and making it difficult for any business to buy such properties that they can then rent, while pushing the rental companies to build more high density apartment style rentals, IMO, could solve a lot of problems that we’re having with the housing market. It would force out a lot of would-be landlords, and make the whole endeavor unprofitable without significantly increasing rent. The increase wouldn’t be tolerated by the market because there would (hopefully) be plenty of inexpensive apartment rentals available.

If we can swing this axe just right, we can basically put these landlords out of business, and free up all their would-be rentals for single families looking to buy.

IMO, it would also crush a lot of the investment property people, who buy homes with no intention of living there or renting it out, and they just sit on the deed until the market value goes up. Now the holding costs of the house are far higher than their potential return on investment and they would cut their losses, flooding those homes into the market as well.

I’m not saying the plan is easy, or that it won’t backfire on us. I’m just saying that it’s better to do this than sit on our hands waiting for so many people to become homeless because they can’t afford rent that the landlords and investment property people no longer have anyone to sell to. That’s when I see property costs falling. When people have given up so thoroughly on having a place to live that they refuse to even rent anymore because the costs are simply too high.

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The only counter argument against this, is that it would cause an increase in rent prices

However, landlords will gladly raise the rent for literally any reason at all, so the increase in rent will happen anyways.

Basically, there’s actually no reason this hasn’t already been passed other than that poor people don’t pay for elections.