There aren't many people earning money as rentiers of unimproved land. But it turns out that people are much more willing to make improvements when they have secure title to the land.

But who gets to rent out the apartment building? Well, the one who put an apartment building there, that's who. Why should anyone else get to?

In many places, unimproved land has a TON of value. In those places, in fact, many people buy a home just to tear it down and rebuild on the lot. They would pay MORE if the house wasn't there. There is a reason the saying in real estate is 'location, location, location' and not 'build quality, build quality, build quality'. The reason you can buy much larger homes for less money in other parts of the country isn't because the building materials or labor are cheaper, but because the land itself is cheaper.

Now, I am not saying that the building itself doesn't have value, or that the person who built and owns the building shouldn't be compensated for that investment and work, but it is disingenuous to pretend that the majority of the value is from the building and not the land itself (at least for most places where rent is high)

I am not in any way, shape, or form arguing that we should seize all private property in some kind of communist revolution; I am simply saying we need to think about how we divide up the value of something like real estate to fairly compensate and encourage development without promoting unfair and ineffecient rent seeking.

Just as a note for those unfamiliar, there's a whole economic philosophy around the idea of utilizing land rents (and also all other rents) for public goods: Georgism.[0]

[0] https://en.wikipedia.org/wiki/Georgism

>Do they have to pay society a fee for being able to claim it as their own?

In most areas, yes. There is a property tax that is charged as a percentage of the land's value. If the owner fails to pay this fee to society, society revokes his ownership, forcefully seizes the land if necessary, and resells the property to another person who is willing to pay the imposed fee.

One problem with property taxes is that they do not capture the ability (or inability) of the property to generate income - basically, whether and to what extent it is capital.

We also do have taxes on income produced by capital - that's capital gains - but, as the article points out, we tax them significantly lower than regular sweat-of-the-brow income, and offer more loopholes. In effect, our economic system incentivizes rent-seeking over labor.

Right, which means the real question is 'how much should those taxes be?'