[AnthonyMouse]

> I don't see the issue with this?

Consider the incentives the government has created here.

You can't build new housing, or it's extremely expensive because it's limited to specific lots and then you have to buy out whatever happens to be there even if they don't want to sell, and destroy a 5 story building in order to build a 10 story building, doubling costs while halving the increase in housing. Housing is thereby expensive.

So you tax people who own housing. Well, that doesn't lower rents, because there are still the same number of people who need somewhere to live but now fewer people to invest in new construction because it's less profitable with more of the money going to taxes, so that lowers supply even more and rents increase to cover the new taxes.

This an undersupply problem. You don't fix it by taxing suppliers.

[tmnvix]

> This an undersupply problem.

Every time I go looking for statistics to back this argument, I come away underwhelmed. In most cases I see little change in the ratio of dwellings to households over the past few decades.

Take a look at the first figure (HM1.1.1) in the following document - particularly those for the US, Canada, Australia, and NZ (all countries with prominent housing issues).

https://www.oecd.org/els/family/HM1-1-Housing-stock-and-cons...

On the other hand, I think there is a strong argument to be made for increasing underutilisation of housing (more second homes, short term rentals, etc).

[AnthonyMouse]

> Take a look at the first figure (HM1.1.1) in the following document - particularly those for the US, Canada, Australia, and NZ (all countries with prominent housing issues).

These are country-wide numbers. The obvious problem is that there is existing housing in Detroit but demand for housing in San Francisco.

It's also somewhat self-defining. If millennials are forced to live with their parents because they can't afford their own home then this is counted as one "household" when there is demand for two.

> On the other hand, I think there is a strong argument to be made for increasing underutilisation of housing (more second homes, short term rentals, etc).

There isn't anything inherently wrong with short-term rentals or second homes, they're just another type of housing demand that requires supply to increase to compensate. Until it isn't allowed to.

[bongodongobob]

Taxing people who own multiple homes and taxing people who own apartment complexes are two completely different things and shouldn't be conflated.

[AnthonyMouse]

You do realize that if someone can avoid the tax by renting it out then they'll just rent it out to a friend for a nominal amount to avoid the tax?

[bongodongobob]

I'm talking about the size of the building. An actual apartment complex. I'm not even sure renting homes in general is a good idea. Let the market figure it out for someone who wants/can afford to own it.

[AnthonyMouse]

> I'm not even sure renting homes in general is a good idea.

Let's review the situation here. 1) The large majority of the land in the area is zoned exclusively for single-family homes. 2) Some people don't have the money to buy, e.g. no down payment or bad credit.

Where are they supposed to live?

[bongodongobob]

If people (corporations) can't own infinity homes, the price of owning a home goes down.

[AnthonyMouse]

That doesn't follow at all. If you reduce investment then you reduce production. The price only goes down if the cost of creating more of them goes down, unless you can remove so much of the demand that you no longer need to add more supply. The small percentage of single-family homes owned by corporations isn't that.

[triceratops]

I'm pretty sure you lose a lot of tax advantages on rental properties (mortgage interest deduction, depreciation etc.) if you don't rent them at market rate.

If they rent it for a nominal amount, they're effectively losing money on the property and gambling on appreciation. If someone wants to do that, good luck to them.

[AnthonyMouse]

You can't deduct depreciation on an owner-occupied house to begin with. The premise is that you're trying to distinguish between landlords and people who have a second home for themselves. But they can just rent it to a friend who in turn lets them use it.

If they're buying multiple homes to rent out at market rates to the general public then they're just an ordinary landlord -- the thing that wouldn't be paying a tax on "second homes" by design.

[triceratops]

I thought the tax on "second homes" was a tax on landlording and speculation, not a tax on vacation homes. I think we might just be talking past each other here.

[AnthonyMouse]

Why would taxing landlords reduce housing costs? It just increases housing costs for landlords, and in turn renters, as landlords become unwilling to pay for new construction until rents increase to cover the tax.

[8note]

The owner of a second home isn't a supplier though, they're a hoarder

[AnthonyMouse]

But how are you proposing to distinguish them? It's all too easy to rent out a property on paper.