| The problem is that the old single family housing unit is occupying valuable land which could better serve multiple families at a higher density. City cores are about increasing the density of human population so that network effects increase productivity, decrease cost, or both thus raising the efficiency of limited resources. The correct way of regulating the cost of a city is based on a combination of the usable area occupied (probably a 2-dimensional area unless someone is able to build above/beneath a given property), the number of tenants there and the 'useful floor space' (exclude hallways, balconies, etc) they receive for whatever their rent is (property taxes are rent paid to the municipality for use if it's commons resources; IE being close to other things and being able to reach them). The government should be driving /down/ the price of housing when it is too high by pushing for the construction of denser housing in the urban core to drive the market curves from the supply side. The government should also have it's tax structure setup in a progressive way (penalize rents not in the lower half of the equilibrium, including home owners that outright own their home (and thus only pay property taxes)). When the market is over-saturated (as it would be if an area is deflating), it should be supporting the existing prices on the market by keeping taxes high, buying back properties that are sub-standard, and focusing on their re-development in to civic goods; some examples of which are parks, arts facilities, or facilitating new small business experiments. |
Just add a low density housing tax. Wait, don't call it that - call it a land-use tax adjustment. Measure ability-to-house-people as some combination of square footage of habitable area, bedrooms, bathrooms, and number of rental units. Divide by the lot size. Multiply by a large enough negative number to incentivize building, then add a constant to make it revenue-neutral instead of a subsidy.
This would effectively subsidize people who build higher-density housing at the expense of people who own parking lots or commercial real-estate. It's a little troubling to tax commercial development or offices, but it's already much easier to get approval to build jobs, so cooling that down a bit shouldn't be a huge issue. Besides, you can dodge the tax with mixed-use buildings, which is generally something that you want for efficient land use.
Land-value would be a better way of assessing the multiplier, but that's not constitutional for California to enact because of Proposition 13. So, it's back to a square-footage with a housing capacity offset.