My strong suspicion is that this will completely fuck over the elderly and marginalized communities.
It also requires property owners to do EXTENSIVE research and information gathering CONSTANTLY to ensure that the number they put down is reasonable.
Many of them literally can't (ex: my 87 year old Neighbor Phylis doesn't care what her house is worth, because she plans to die in it, and isn't seeking to maximize utility. Instead she wants to pass peacefully in the house she remembers raising her kids in, and has lived in for the last 50 years. She has no car, is in a wheelchair, and uses basically no online services - how is she going to go evaluate the right value for her house?).
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Basically - this plan sounds great for 5 seconds and then you realize people would literally revolt the second you pass it.
"It also requires property owners to do EXTENSIVE research and information gathering CONSTANTLY"
Every year in Chicago.
My house has been, and still is, assessed for 600K over what I paid in Nov. 2021. It had been on the market since 2016, until I bought it. The price I paid is the value of the house.
First assessment appeal denied.
Second appeal lost in the system.
We have to fight against an unfair and arbitrary tax system EVERY year.
Now they are going to index the tax rate to inflation.
Maybe other communities are under-taxed, but mine is not.
I’m with you, mring33621. Cook Co. is ridiculous. Bought our home (in 2018) just north of Chicago, out of foreclosure. Taxes jumped far beyond what they’d been trying (and failing) to sell for prior to foreclosure. Similar experience last year with an apartment building being valued at more than twice what I’d paid (in rough condition) in an open, arms length transaction literally months earlier.
AFAICT, hiring an attorney is the way to go. Then you still have to pay, but much less overall. I’m about 80% convinced that the tax assessors are in it with the appeal attorneys to almost literally write themselves checks. Not that such misdeeds would ever occur in Chicago/Cook…
The house was literally for sale to the public since 2016 through end of 2021. If it was worth more than what I paid, someone would have purchased it before I did.
Guaranteeing that people can take up the same space that they did when the population was half its current level is a great way to ensure that future generations have nowhere to live.
The person you're replying to isn't arguing against land value taxes in the abstract, they're arguing against an implementation of LVTs that would force most homeowners to decide between overpaying taxes by a wide margin or suddenly losing their home.
Perhaps I'm not stating the proposal clearly. Nobody would suddenly lose their home. If you understated its value, and someone made an offer, you'd have the opportunity to restate the property's value, keep the home, and pay the appropriate property taxes from then on.
Hypothetically, let's say I owned a modest home. Then, what if a very wealthy person who grew up in that home wanted to buy it for a grand sum of money? In that case, I'd be torn between revaluing my house to a huge amount (that no one except this one person would be willing to pay) and being forced to sell. It's an interesting scenario, because that wealthy person could lower their valuation almost immediately after the sale, since no one else would pay what they paid.
C'mon, even setting aside the fact that the victim here walks away with a giant pile of money, there are countless ways to address this extremely unusual special-case scenario. For instance, you could be free to decline to sell as long as your declared valuation was >= the local neighborhood average.
> C'mon, even setting aside the fact that the victim here walks away with a giant pile of money
Money is a medium of exchange. There are items that are literally not for sale, and the excuse of "but they got money!!!!" is completely unacceptable as a replacement.
How are you going to value the writing on the walls of the home my neighbor from her now-deceased son?
How are you going to value the 6 (six!) graves of the dogs she's buried in her back yard, Each with a custom stone statue.
How are you going to value that she's memorized her current home layout, so that large cataract in her right eye doesn't bug her as much when she's in the familiar layout?
How do you value the extra time and expense it would take her to find a new home, given she's wheelchair bound?
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and your "new plan" is devolving into trying to add all sort of extra conditions and rules around this - which gets us right back to: implement this and people will literally try to kill you.
Huh? In the scenario you describe, someone is paying below the neighborhood average in property tax, so someone makes an offer on their property, and they decline by raising their declared valuation to match the neighborhood average. Then they stay in their house and pay their fair share of property tax.
You've never lived in a transitional neighborhood, pretty clearly.
> and they decline by raising their declared valuation to match the neighborhood average.
First - this is not in line with the previous posts. What stops me from simply declaring my value is 0 until someone makes an offer and then suddenly it's the right value. Until next year when it's 0 again because that buyer has gone away. If I only have to declare at time of potential sale, the declaration is useless.
Second - having lived in a transitional neighborhood, if your house is valued at the neighborhood average, it will be bought in 30 seconds, sight unseen, usually by a corporation that plans to rehab it (because it was last updated in the 70s) and then rent it forever.
Basically - money isn't everything, and maximizing utility in a purely capitalistic sense is not a set of values shared by enough people to make this work.
If you limited this to only commercially zoned land, then maybe - but you have a social contract with all those people who bought their houses, and violating that social contract, especially in a way like this, is a recipe for disaster.
I've lived in transitional neighborhoods at several points in my life.
> Until next year when it's 0 again because that buyer has gone away.
Why would the buyer go away? The state itself could maintain offers on any properties lowballing their property taxes. But that wouldn't be necessary, because at any time, there would always be ample interest in purchasing real estate for discount prices. You say this yourself:
> if your house is valued at the neighborhood average, it will be bought in 30 seconds
...but again, it sounds like you misunderstand my proposal. In 30 seconds, someone would offer to buy, and then the current property owner would have the choice of either selling, or keeping their property but raising their property-tax assessment to either that amount, or the local average, whichever is lower.
Ah - now I'm fairly convinced you haven't actually bought real estate.
There is no such thing as a "standing offer" to buy a house. They're a contract with very clear start and end dates (most offers are good for between 72 hours and two weeks).
This is because both parties have to agree at time of exchange on the value of the good, and the person making the offer usually needs to have financing lined up - They literally cannot make an offer that will be good for long periods, because the financier won't agree to that.
As for this...
> ...but again, it sounds like you misunderstand my proposal. In 30 seconds, someone would offer to buy, and then the current property owner would have the choice of either selling, or keeping their property but raising their property-tax assessment to either that amount, or the local average, whichever is lower.
Ok - follow along... now the next offer comes in 2 days later at the current value. The owner STILL has zero desire to sell. What now? Do they get to raise again?
Dude - this whole thing is ending up with more rules and regulations that the current market, which is exactly why pushing this kind of thing simply doesn't work.
In theory you're optimizing land efficiency, but you're fucking with other efficiencies ALL along the chain, and the net result is that people hate you.
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Also - taking you at face value: "raising their property-tax assessment to either that amount, or the local average, whichever is lower."
This is fucking already how taxes work. At least in my area, every house is taxed at the local average (fulton county does average assessed value tax for land). So you're literally gaining nothing for all this additional complexity.
> My strong suspicion is that this will completely fuck over the elderly and marginalized communities.
People who are hoarding a huge house in a desirable area to do nothing but slowly die in need to be fucked over. They're worse than speculators.
> Many of them literally can't (ex: my 87 year old Neighbor Phylis doesn't care what her house is worth, because she plans to die in it, and isn't seeking to maximize utility. Instead she wants to pass peacefully in the house she remembers raising her kids in, and has lived in for the last 50 years. She has no car, is in a wheelchair, and uses basically no online services - how is she going to go evaluate the right value for her house?).
She should quote how much someone would have to pay to make it worth her moving out - that's something she should be able to figure out for herself. If she wouldn't move for less than 3 million, quote it at 3 million.
It also requires property owners to do EXTENSIVE research and information gathering CONSTANTLY to ensure that the number they put down is reasonable.
Many of them literally can't (ex: my 87 year old Neighbor Phylis doesn't care what her house is worth, because she plans to die in it, and isn't seeking to maximize utility. Instead she wants to pass peacefully in the house she remembers raising her kids in, and has lived in for the last 50 years. She has no car, is in a wheelchair, and uses basically no online services - how is she going to go evaluate the right value for her house?).
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Basically - this plan sounds great for 5 seconds and then you realize people would literally revolt the second you pass it.