Re:Who Owns England?
by jdavis703 on Tuesday May 23, 2017 @06:31PM
(#14405974)
Why are there abandoned buildings, parking lots and urban farms in downtown and near downtown neighborhoods in most US cities? I lived in a converted former warehouse that sat empty for decades because the owner had a dream that a factory would eventually rent the space again. It took the owner's death and his son inheriting the property for it to be put to "efficient use" again.
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The Georgist argument is that the problem is property taxes aren't based solely on land value, and this creates excessive deadweight loss from taxation.
https://en.wikipedia.org/wiki/Georgism
Under a system of pure land value taxes, an empty lot downtown would be taxed at the same rate as the highrise next to it, and taxed much higher than an empty lot in the outskirts—a huge incentive to put that empty lot to more productive use.
The proliferation of parking lots is a regulatory/zoning issue.
Worthless property is worthless and the carrying cost is low.
If you have the capital, sitting on low value property can make you a lot of money.
Also, if you are a real estate investor, you can "launder" your profits to avoid taxes. That's why old shopping plazas will degrade until there is only a kung-fu place and a dollar store. It literally has a value sopping up real profits from thriving holdings with paper losses.