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by lamarpye 2616 days ago
That sounds like a great way to slow down real estate development. Make sure there is an additional cost if you oversupply the market.
1 comments

Sounds good. Careful, controlled growth is always better.
Really? Why is it always better? Does this rule only apply to real estate?
Why is uncontrolled growth better? Seems like it most often leads to waste. In the real estate context this manifests as ugly, unlivable spaces which become derelict as soon as the frenzy passes.
I didn't say uncontrolled growth was better, I said a vacant building tax would slow or restrict new development.

Of course there is waste, this is part of the cycle of boom and bust. The people that mistime the market will overbuild and lose their investment.

When the frenzy passes, house may stay empty, but the market will adjust. Fewer new houses will be build and people who stayed out of the market will have a chance to buy at cheaper prices.

You can argue the degree to which growth is controlled but the alternative to “careful, controlled growth” is uncontrolled growth.
No, the alternative is less careful controlled growth. Uncontrolled growth is impossible: you need unlimited labor.

The market controls growth. Of course many factors manipulate the market (interest rates...). Boom/Bust is always going to be a factor because it isn't possible to know perfectly how much space we need before we need it. Boom/bust isn't even all bad, those who need space after the bust can get it cheap and start something interesting that they wouldn't otherwise) - artists for example need cheap space if they are to start a studio.

> I didn't say uncontrolled growth was better, I said a vacant building tax would slow or restrict new development.

> Of course there is waste, this is part of the cycle of boom and bust. The people that mistime the market will overbuild and lose their investment.

> When the frenzy passes, house may stay empty, but the market will adjust. Fewer new houses will be build and people who stayed out of the market will have a chance to buy at cheaper prices.

Why would there be new development in places with high vacancy? Wouldn't the community want new development to be hindered if most of downtown is empty already?