Re:Goodbye, New York, California and Illinois – Hello where?
by andrewprock on Friday January 17, 2020 @07:18PM
(#22081131)
Prop 13 is essentially "rent control" for homeowners, and largely has the same effects as rent control for renters.
Re:Goodbye, New York, California and Illinois – Hello where?
by Spooky23 on Friday January 17, 2020 @07:30PM
(#22081201)
> Yes, there is a lot of foreign investment in California real estate which just sits empty. I get ads from agents that "specialize in finding Chinese buyers" which is code for "people who will pay more than asking and not care what condition the house is in".
Or more simply, “money laundering”.
Re:Goodbye, New York, California and Illinois – Hello where?
by jedberg on Friday January 17, 2020 @08:36PM
(#22081545)
Well not exactly. A lot of it is that China only allows their citizens to hold so much private wealth, so the wealthy find ways to get their money out and hold it elsewhere.
California real estate (and western real estate in general) is a good place to hold it because of our stable economy, solid legal system, and you get something tangible (the land and building).
Re:Goodbye, New York, California and Illinois – Hello where?
by Spooky23 on Friday January 17, 2020 @11:48PM
(#22082353)
So as a rich Chinese person, you invest in western real property as a vehicle to make it appear that you don’t control money that you are not entitled to by law, or move it out the reach of the banking or taxing authority.
... that’s money laundering!
Re:Goodbye, New York, California and Illinois – Hello where?
by micmil on Friday January 17, 2020 @11:57PM
(#22082386)
That is not money laundering. If you want money laundering go have a look at what goes on with Trump properties. Real estate changing hands with massive variances in value, well out of step with market influence.
The entire concept of money laundering requires the money be illegally obtained. Simply moving money that you legally acquired around is not money laundering. Stop using words you do not know the meaning of.
SB 827 was pretty good. [0]
SB 50 was a good idea with a bad execution [1]
> if the story of net outflow is true.
The article says that California still saw a net inflow due to births and incoming foreign migrants.
> Either the existing supply is being manipulated in some way,
It is, via rent control, which has shown time and again to only help people who already have housing at the expense of those who don't already have it when it's enacted. It also helps wealthy people more than poor people by constraining rent raises even though they could afford market rates.
It is also manipulated by prop 13, which allows people to rent out properties they've owned for a long time at a profit when similar properties can not be. The natural market rate of rent is all inclusive of current costs including tax. But if your tax rate is artificially low, then that difference is increased profit for you, which encourages people not to sell their properties.
For example, I'd had my home for 10 years, and if I were to rent it out, my profit would be about $1,200 a month at current market rates. My property tax is artificially low by about $1,100 a month. So my entire profit would come from Prop 13. Why would I sell my house if I can rent it for profit only because of the lower tax rate?
> or some portions of the demand pool can offer a lot more than others pricing the rest out of the market.
Yes, there is a lot of foreign investment in California real estate which just sits empty. I get ads from agents that "specialize in finding Chinese buyers" which is code for "people who will pay more than asking and not care what condition the house is in".
[0] https://leginfo.legislature.ca.gov/faces/billTextClient.xhtm...
[1] https://leginfo.legislature.ca.gov/faces/billTextClient.xhtm...