Re:Canada bans most foreigners from buying homes
by Spooky23 on Monday January 02, 2023 @10:14PM
(#34227108)
Because values have to climb in order to keep the real estate shell game going. Buildings depreciate, so increasing demand is the way to make magical money. The old technique, redlining, is illegal.
Commercial real estate is architected around tax avoidance strategies. 1031 exchanges, depreciation rules, etc. In many cases, it’s literally possible to build a commercial development with zero out of pocket. Residential is all about building asset value through mortgages.
Key markets like California are distorted to be even worse because the property tax laws encourage holding and not improving property. Unless there’s a constitutional convention or ballot, you’ll have homes worth $100M in 2080 paying property taxes based on a $100k valuation in 1980.
Commercial real estate is architected around tax avoidance strategies. 1031 exchanges, depreciation rules, etc. In many cases, it’s literally possible to build a commercial development with zero out of pocket. Residential is all about building asset value through mortgages.
Key markets like California are distorted to be even worse because the property tax laws encourage holding and not improving property. Unless there’s a constitutional convention or ballot, you’ll have homes worth $100M in 2080 paying property taxes based on a $100k valuation in 1980.