[avar]

I think you and others in this thread are missing that the proposed mandatory bidding price is a multiple of the "real" value.

So yeah, don't like your new neighbors who just bought a $500k home next to you, you can give them $1.5m (or whatever) to get their house. How are they now worse off exactly?

That family can then probably buy the larger house next to yours for $1m, and have $500k in cash left over. A bank that was willing to give them a loan for a $500k house is less likely to do so when they've got an extra $1m in cash?

The system the authors proposed is mainly intended as a clean way to get rid of things like eminent domain and the holdout problem. Most real estate transactions would take place between "willing" sellers and buyers, just like they do now.

[Jiro]

>I think you and others in this thread are missing that the proposed mandatory bidding price is a multiple of the "real" value.

That doesn't work. People will set the "real" value to be lower than the real value, in order to reduce their taxes, but high enough that someone who wants to buy the house has to pay barely enough, after multiplying, to make it worthwhile to sell. The tax rates will then be raised accordingly and we'll just have "the mandatory bidding price is the real value" with extra steps.

[avar]

Right now we don't live in a world where such a bidding system exists, because it's a rather obscure (but interesting) idea. Even if people were widely aware of the details the political will to implement it probably doesn't exist.

But you seem to be arguing that if such a system were implemented the very structure of it would lead to a race to the bottom?

I don't see why that would be the case, if there's political reluctance to implement such a system to avoid certain outcomes, why wouldn't there be the same reluctance to raise the relevant taxes?

In any case, the book I cited upthread doesn't argue for some sort of "shock therapy" introduction of a system like this, but e.g. starting with commercial real estate.

Even people who'd argue that they should never have to sell their ancestral family home would probably find it hard to extent that argument to their neighbourhood Starbucks never having to accept a bid from a competing coffee company.