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L.A. County wants to cap rent hikes at 3%. Landlords say that would push them to sell
(www.latimes.com)
this post was submitted on 09 Jun 2024
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Would property taxes actually do much? They're so little even in high property-tax states that I think you'd need to do a lot more than that to FORCE rich people to utilize their other properties. High taxes would potentially push more costs on renters. Maybe we should just outlaw having more than 1 or 2 homes... including for real estate companies and banks :)
I keep wondering how to make the law do that. Making a company is like $100, that's nothing compared to the house price. They would just have shell companies all over each owning a single location. 123 Fake St., LLC; 124 Fake St., LLC; etc.
You'd limit Ultimate Beneficial Ownership of the properties, not direct ownership.
I'd probably do something like: No individual or private entity may have Direct, Indirect or Ultimate Beneficial Ownership exceeding or of multiple of any of X(2-5?) Single Family properties, Y(2-3?) low density Multi-tenant properties, or Z(1-2?) high density Multi-tenant properties. Excluding the first wholely and solely owner occupied property. Excluding Ultimate Beneficial Ownership of less than A(.01-5?)% of a property. Excluding Ownership less than B(30-180?) days. Failure to comply results in forfeiture of newer ownership to REGULATOR-TBD until compliance is met. Multi-tenant properties have C (5-10?) residences
IANAL, probably some other loopholes that need closing. But the intent would be to limit consolidated ownership of many properties. But not impact several of the more reasonable ownership structures, nor impact churn of properties. The regulator would sell whatever extra it gets to fund housing programs.
You forgot the part about where the individual in question goes to jail when caught. That part is important.
How will that work for individuals who own .00001% of hundreds of homes (by owning shares of several real estate holding companies)?
Also, mega rich people don't to legally own anything. It is owned by a trust with undisclosed beneficiaries. It is also routed via multiple offshore dummy corporations. It is set up this way so that tax agencies can never figure out incomes and inheritances.
Law with two parts, only a specific type of company may own rental properties. And you may not own or be employed by more than one property; including holding stock. The same rules apply to property management companies that service land lords with few properties; possibly with larger limits on how many properties they can manage at a time.
With that basic structure we can decide how many buildings/units each company can own. For example the limit could be 100 single family homes, or 3 mid sized complexes, or 1 large tower. Then we should be able to have a system that keeps landlords from going big. Makes the system so decentralized market concepts must work and monopoly power is effectively destroyed.
Potentially, but I think here not so much. Competition drives prices down. In a perfectly competitive market, prices are pretty much equal to the cost of production. In that case, any tax would be completely passed on to the customer. But you can't produce land at a certain location. My guess is that rents are largely determined by willingness to pay.