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I wholeheartedly agree with this. My opinion is that governments should tax 2nd, 3rd and further housing so as to prevent people from accumulating residential buildings.

If you want to live of your rents, buy a commercial or industrial building, speculate with that. But residential construction should be protected to ensure each household is able to buy one with the average country salary.

A bad idea in isolation, because it forces people to store all their net worth into their main tax free house, causing people to squat in gigantic houses that they don't need or want. I've seen this distorted behavior in people I know.

We should reward the person who lives in a normal house below their means, and buys an apartment as an investment (which is private capital into new construction that wouldn't have happened if they didn't do it), then rents it out, which increases stock on the rental market, and decreases rental yields.

If you want to tax ALL housing the same, including people's only house, then sure, go for it. Or better yet, tax all land ownership. Just don't distort people's behavior by making a special exception for their main house.

In theory I agree with everything but I’ll point out that:

> But residential construction should be protected to ensure each household is able to buy one with the average country salary

is political suicide, because you’re giving every voter with existing property a haircut on money they believe they already have, that they’ve usually borrowed to buy, and that they’ve financially planned on appreciating. Per Jean-Claude Juncker, “ We all know what to do, we just don’t know how to get re-elected after we’ve done it”

Just make it easier to build houses. It's like the Bitter Lesson, but for regulation-loving progressives.

Also, buying or building and operating an apartment complex isn't speculation in general, unless you consider basically any financial investment speculation.

Several UK councils now charge double council tax (the monthly tax you pay for having a house) on second homes, exemptions notwithstanding.
I am against "speculation" on any sort of real estate. On other hand I am not against real estate investments. And I don't think single family housing deserves any kind of special treatment.

I see no reason why someone providing capital to build a building and then renting it out to cover cost of that capital, maintenance and building cost is unreasonable or bad thing.

Issue really is when market is manipulated to keep prices going up beyond inflation or normal changes in demand. That really ruins everything. Real estate shouldn't really appreciate at all over time beyond inflation.

I assume that increasing the taxes would just lead to higher rents, right?
Speculation is not really the issue, most of the issues are around regulations limiting construction.

If you wanted to incentivize home buying for young families, then the demographic that needs the most incentives are old people whose kids moved out decades ago. Every single person I know has two aging parents living in 4 or 5 bedroom homes by themselves, my own included. I know people are sentimental about the homes they grew up in, but this is the biggest lever you could move: hike property taxes on properties with unused occupancy.

If you want to keep the home in the family, then this encourages the parents to give the home to one of their kids who actually need it because they're starting a family of their own.

How do we feel about cottages or summer homes for people who live in poor weather climates? Is that a luxury that should be universally condemned? I woulnd't think those qualify as speculative but more like lifestyle money pits from what I have heard.
So people who want to rent are forced to live in commercial buildings?

Some people need to rent and some will never be able to of want to buy property. This is taxing them even more.

If we do something like this it should come from financial system. Like already you need 30% deposit when you buy investment property in NZ. Perhaps we should only give rental loans to new builds only.

no problem, main apartment will be written in my name, 2nd in my wife's name, 3rd in my son's name, 4th in my daughter's name and for others I will just set up companies

this proposition literally solves nothing

and for the record I own one real estate, which I bought without mortgage and live there with my family

What a funky way to address a supply problem. Just build more housing!
Lots of people in the thread pontificating about tax shelters, net worth, good investment strategies.

I suggest you do those things while homeless. Let me know how it goes.

This is an indirect way to get at what we really need: a wealth tax. Don't treat the symptom, treat the disease.
Your logic misses the point. To make housing a non-investment, we need to tax the investment returns on houses. This mean taxing capital gains on all houses, not just 2nd and 3rd homes.
People want to exempt housing from the laws of supply and demand. The reason real estate is expensive is that there is not enough housing available for everyone to own a house that wants a house. If we want inexpensive housing, we need a massive project in this country to build housing. There is no other way to fix it. There is no way to shuffle around ownership of existing housing stock that is going to magically make more houses available. There are not a bunch of houses sitting empty that people want to buy or move into.
Pretty sure there are plenty of houses sitting empty or as holiday rentals. Second homes, airbnbs, etc. Those could be simply banned or highly taxed and the shuffling of ownership would happen naturally.
Houston added something like 500,000 people to its population and housing prizes went DOWN because they built more housing and their ratio of housing to people went up. Supply and demand.
The point is when you have cartel-like behavior from homeowners in a democracy, then you aren't "exempting housing from the laws of supply and demand."

No, these homeowners know exactly what they are doing and they're intentionally creating a shortage to increase the value of their properties. The problem with the housing crisis is that it's entirely rational behavior. It's just that there should be some sort of human right that prevents this type of exploitation.

You have to understand that our money supply is based on debt. It shouldn't be: the money supply is a public good and should be managed for the public good via citizens dividend or whatever, but currently it is debt-based and managed for the private good of the banks.

Housing debt has to expand or the economy tanks because the money supply shrinks. Since we are at the end of the current debt cycle, housing has gone vertical. It will collapse because eventually exponential curves can't fit reality. We may be seeing the start of that now.

The core problem is how we create money and who benefits from it. That's what needs to be fixed.

Money isn't managed by anyone. There's an excellent description here: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-... Scan for the sentence "at that moment, new money is created" and then read the whole thing anyway ;)

It seems to me that if you want some sort of money creation management role in the economy, you need to restrict people's ability to lend and borrow from each other. So if you wanted to lend me money, or you wanted to borrow from me, we would have to apply for permission.

Off the top of my head, I can't think of anyone who's tried to restrict people's right to borrow from a willing lender. It doesn't seem like a good idea intuitively, but I do think it's something you must do if you want to have a money creation manager.

Money is a promise of future work or in other words debt itself.
Where mortgage interest is a deductible expense (usually the case if savings interest is a taxable income) then one simple fix is to limit that to one home. Second homes or homes bought in speculation using borrowed money are at least less attractive then.

Also for land tax and similar: raise them by a lot and use that money to pay for a tax-exemption for one home

XXX are for living, not for YYY

you can apply this for pretty much everything, who will decide what can be used for speculation? I want much rather free market than someone deciding what I can buy with my earned money

yeah, and gold should be for making space stuff, electronics or jewelerry, and water should be for drinking/cooking, not for having fun in swimming pool, etc.

edit: the problem in China is not expensive real estate, but no options to invest money, Chinese stock is shit, you would earn pretty much nothing over 10 year period, made that mistake once, even real estate prices are not really growing in China, my in laws bought apartment many years ago, now they would be lucky to sell it for zero profit, blame chinese economy with minimal real growth causing minimal inflation causing all these issues

on the other hand it's nice to come to China after 9 years and find out meals in restaurant cost pretty much same as 9 years ago, unnelievable in Europe, sadly so are their salaries and I have still seen job ads offering like 2500-3500RMB same as 10 years ago, though you can rent small apartment for 1200-1600 RMB (talking both about Beijing suburbs)

nice bonus in China is you can't even own the land with your house, just lease it for few decades

If we wanted to do this, it would be trivial to introduce a 100% capital gains tax on the sale of real estate.

Instead, we give people an exemption for their real estate capital gains, so they can buy a bigger house without paying taxes at all. Then these same folks pull up the latter by voting in restrictive zoning to protect their property values.

There is one verifiably rigged game in finance, and it's residential real estate in affluent areas. It's the only industry where overt collusion and cartel-like behavior is completely legal. The result is generations of people who rationally load themselves up with way more debt than they probably should, because getting on the latter is the only way to stay above water within our lifetime.

A land value tax makes way more sense.
So that was 2016. Why doesn't it link to "Chinese property sector crisis (2020–present)"

https://en.wikipedia.org/wiki/Chinese_property_sector_crisis...

Never mind, I added a link to it, and the prior Chinese bubble (https://en.wikipedia.org/wiki/Chinese_property_bubble_(2005%...

Interesting timing, with Australian budget night (removal of tax discounts for both capital and trusts, and for investment in existing housing stock).
Social housing is the way to go. People who live in social housing are mandated to take free plumbing/electrician/whatever classes to serve the community. In this way people get some internal jobs and sense of community, while government reduces the costs of maintaining them.
Maybe severe capital controls and other heavy-handed and objectively unwise but politically desirable (for a certain group) financial policies aren't the best plan for maintaining a stable economy?

I wonder when Xi will come up with a witty one liner for that one.

Chinese property sector crisis (2020–present)

https://en.wikipedia.org/wiki/Chinese_property_sector_crisis...

10 years ago: https://www.bbc.com/news/world-39512599
Allow anyone to build a shack and shit into a hole on any postage stamp size of land they could get, and it would be far more affordable.
Yep, building codes are a double edged sword. Yes, they make life better for housed people and avoid streets looking like an India-esque mess of exposed wiring and open sewers.

But they also establish a minimum bar to _be_ housed. If you can’t afford a (by global standards) very nice home, you will be on the streets.

You can find places like that all over the world. They're slums.

Maybe regulations put too much burden on homeownership but slums create huge issues as well. Basic plumbing shouldn't be taken for granted.

This is probably the reason why Gen Z is turning towards China and will eventually come out on top if a economic collapse in the west were to happen.
Within a few years Xi coined this phrase, China began having a massive real estate sector problem due in large part to speculation: https://en.wikipedia.org/wiki/Chinese_property_sector_crisis... . Part of this speculation (which the article I cite talks about) was due to private Chinese organizations, but it's also in part due to the Chinese government's decisions to overbuild in order to drive urbanization (https://en.wikipedia.org/wiki/Underoccupied_developments_in_...).

The intentions of a government aren't enough. You need feedback systems. China doesn't have effective feedback systems, because the CCP actively destroys them. No one is "turning towards China" - they have negative net migration since 1968 (https://data.worldbank.org/indicator/SM.POP.NETM?locations=C...).

So the Chinese government making retirement unaffordable, making it impossible to invest in equities, under funding pensions, and then attacking the last thing people can invest in for retirement savings is what won Gen Z?
that would be funny considering China is closer to economic collapse than west considering their zero inflation or salary growth for years and raising youth unemployment, I visited after 9 years since I moved away, salaries and prices in restaurants are pretty much same as 9 years ago, so much for growth, they are going for Japanese way...
Unaffordable housing turns entrepreneurship into a rare privilege.

Whether you think that’s a good thing or not depends on whether you _actually_ believe in meritocracy or not. I’ve found most people don’t believe in it as much as they say they do.

Which kind of meritocracy - the original definition that points out that “merit” is a function of wealth and social advantage, or today’s sanitized version that attributes merit to achievement while ignoring all the advantages that lead to ahievement? https://en.wikipedia.org/wiki/The_Rise_of_the_Meritocracy
Second/vacation homes should be taxed at 200% per year with all revenue going toward low income housing.
Or just build more housing instead of constraining supply.
So is energy, food, water and space. And yet, all cost money.
False dichotomy. The fact that something costs money doesn't mean it has to become a speculative asset.
My news feed article just before this one had the title

"Trump Urges Congress To Pass Bill To Prevent Corporations from Scooping Up Single Family Homes"

Government causes speculation. Asks people not to speculate. Classic.
It's not wrong.

I would 100% support measures that inhibit corporations from owning residential property.

Apartments are probably a special case, but I'm not entirely convinced the age of giant corporate complexes is a good one.

I also don't necessarily mind if a PERSON owns a house and rents it out (e.g., to spend a year somewhere else, or because it's a lake house or something), but I get suspicious of they own a bunch of them and make it a business. Denying corporate status would discourage that.