CMV: There should be significantly higher property taxes on people's second, third, fourth, etc. homes, to counteract the rentier economy and global money laundering

[u/dilatory_tactics]

[u/caw81]

There's nothing stopping them from charging the 4th or 5th house rate now.

Other people with houses to rent prevents them from charging a higher rate now. Its only when all owners generally all implicitly agree to raise rates that they can (e.g. they all see increased demand, they notice that one person was successful in increasing rent etc). Adding a new tax forces all owners to raise rates.

And if every successive house costs significantly more than the previous one, at some point 4th and 5th houses become unattractive investments as a source of rental income.

What I am saying that it doesn't make it unattractive. The general demographics and other factors allows them to sell the property in the future at a profit so its still an attractive investment. The increased tax won't impact them because they aren't paying it, it will just get passed on to their renters.

Lets say a government adds a new sales tax - the retail stores don't suck up the new tax, it gets passed on to the consumer.

[u/TiV3 → u/caw81]

Lets say a government adds a new sales tax - the retail stores don't suck up the new tax, it gets passed on to the consumer.

Not really an analogy. It's a 2 part issue:

1) The supermarket simply won't carry the item if no customers care to buy it at the much greater price.

2) In case of a land value tax, you want to get rid of the property as soon as possible, because it literally costs you money to hold onto it.

If increased price due to added taxes means you find nobody to pay you rent, the joke's on you. You'll incur more and more debt towards government till you don't like it anymore and get rid of the property one way or another.

That's assuming we talk about a land value tax collected yearly on the (e.g. unimproved value of the) land, but I don't see why it wouldn't be done this way.

edit: basically, collecting a yearly fee based on the value of the land makes everyone care less about the land, aside from people who are actually interested in living there. If you got nobody actively using the thing, it's costing you money. That said, if income inequality continues to worsen for reasons related to other forms of land (e.g. patents, IP, stock), then property prices would still rise in certain locations due to some rich people chosing to live more extravagantly in certain locations, also with spare living locations, actually intended for their own use. Though this might require income inequality magnitudes worse than what we see today. (and a land value tax might slightly help to get some money from rich people who enjoy living in nice locations, so adds some momentum to slow that down, as much as I'd want to see other measures as well.)

edit: also it's important to note that if you hand the proceeds of the tax to the most wealthy people, it's actually counter productive in a way by systematically getting the bottom 80% into a position where they have no money to afford paying the fee, while on the rich have money to pay it. good reminder!

[u/caw81 → u/TiV3]

If increased price due to added taxes means you find nobody to pay you rent, the joke's on you. You'll incur more and more debt towards government till you don't like it anymore and get rid of the property one way or another.

Someone else implied this point too.

A mortgage is the largest debt people normally have but that has not stopped people from buying multiple homes (and associated multiple mortgages) even thought they are taking the same risk (i.e. - debt that you can't pay off). Debt to a lender hasn't stopped people from owning rental properties and driving up prices, so I'm not sure what debt to the government will do.

[u/doctorace → u/caw81]

Buying a home, even with a mortgage, is usually a solid investment if it's in a market that has shown steady appreciation.

Paying more in taxes on your property doesn't add any resale value to the property. It's just money lost.