
In Greece, Property Is Debt - JumpCrisscross
http://www.nytimes.com/2016/11/02/opinion/in-greece-property-is-debt.html?em_pos=small&emc=edit_dk_20161102&nl=dealbook&nl_art=17&nlid=65508833&ref=headline&te=1&referer=
======
flexie
Let's get facts straight:

The state property tax in Greece is 0% for property up to €200K. Then 0.2 to
1% from €200K to €5M. Then 2% above €2M.

Property taxes are hardly killing the Greek economy and especially not for the
poor or the middle class. On the contrary, Greeks are paying very little. The
problem is that Greeks used to have much more property than for example
Northern Europeans.

For comparison, in Denmark the property tax is 1% up to €406,961. Then 3% for
values above that. In addition to this there is a local tax on land value,
which is generally 1.6-3.4%.

~~~
kkapelon
Numbers don't really say anything if you don't explain who decides them.

Here are two scenarios for you

1)I live in Greece and get 400 Euros a month and barely break even. I live in
a house (inherited by my parents) that would fetch probably 90.000 in the
market. Government says that it really costs 300.000 euros. I get taxed for it
even though I cannot really afford it.

2)I am unemployed and live with my parents. They have a pension of 600 euros a
month. My parents die. I inherit their house. The house was built in the 60's
and is on an expensive island. Government says that the house values 500.000
and I get taxed even though I have no money at all on my own.

Basically the Greek government is unable to tax you directly (i.e. on the
money you really make) and instead tries to guess your income by looking at
the house. There are several cases however where your current house says
nothing about how much money you actually make.

~~~
nugget
Wouldn't the solution in either case be to sell the house and move somewhere
you can find a job?

~~~
kkapelon
Nobody would buy the house (apart from foreigners) because it is now linked to
the tax that everybody wants to avoid. Also cash flow is a big problem for
everybody so it is hard to find somebody that has 90.000 in cash and also
willing to buy it.

Move to where? Another city? Another country? Unemployment is everywhere in
Greece.

I am not even mentioning the sentimental factor of being forced to sell your
parents house for no particular reason.

Also if it was that easy to move somewhere else and find a job, you would have
done it already (you would not wait for the government to create this tax and
then think about it)

Here is a third scenario for you reading pleasure

3) I am 75 years old living with my wife who is 70 years old in the house that
we bought in 1950. We are both retired farmers. Our pension is 500 euros in
total. In 1950 the area we selected for our house turned out to be a popular
one (in 1950 it was just an empty field).

Government passes the law and our house has a value of 500.000 (because of the
area around it). Now out of the blue we have to pay property tax. What do we
do?

~~~
nugget
> Nobody would buy the house

If you put this hypothetical 90k euro house up for sale at a public auction
tomorrow, what would it sell for? 50k? 70k? Real assets are usually sale-able,
albeit perhaps for less than the owner thinks the asset is worth.

> Move to where? Another city? Another country? Unemployment is everywhere in
> Greece.

Since Greece is still in the EU, you can move to any member country right? UK,
Germany, France? Certainly there must be places in the EU where the economy is
better and there are more opportunities. People have been migrating around the
world chasing economic opportunities for thousands of years. A million Syrians
just traveled through Greece on their way north in search of this.

> Government passes the law and our house has a value of 500.000 (because of
> the area around it). Now out of the blue we have to pay property tax. What
> do we do?

It seems that what has effectively happened is that the Greek Government has
decided to confiscate a large part of the country's wealth through extremely
high property tax rates. As other posters on this thread have mentioned, if
the tax rate is 1% but the appraised value is 3x the actual market value, then
the real tax rate is 3% and your Government is just playing games to try and
hide the confiscation.

Personally I would vote for revolution - national default, totally new
political leadership - and start to rebuild the country from scratch. Anything
is better than decades of externally enforced austerity crippling a country's
spirit as reflected in everything I read these days about Greece.

~~~
sasvari
_Personally I would vote for revolution - national default, totally new
political leadership - and start to rebuild the country from scratch. Anything
is better than decades of externally enforced austerity crippling a country 's
spirit as reflected in everything I read these days about Greece._

Looking at the democratically elected politicians/governments in Greece in the
last decades I don't know where a _totally new political leadership [edit:
which would be interested and capable of 'rebuilding the country']_ should
come from. It's not that the electorate didn't consistently vote for the
political leaderships which are/were, at least partially, responsible for the
situation Greece finds itself in right now.

~~~
crdoconnor
>It's not that the electorate didn't consistently vote for the political
leaderships which are/were, at least partially, responsible for the situation
Greece finds itself in right now.

That isn't really true. In both of the previous elections they voted for
parties promising to end austerity.

In both cases it wasn't even as if the parties didn't want to end austerity
but when they tried they were basically threatened with economic catastrophe
(shutting payment systems in the entire country, indefinitely).

Last year they fired a kind of warning shot. Greek banks had to shut down for
six days, cash machines only let you remove a small amount each day, capital
controls were imposed. That could have been continued indefinitely.

Eventually Syriza wilted. Their mistake was assuming in the negotiations that
the Troika's primary concern was getting their debts repaid. It wasn't. They
just wanted greece to knuckle under and do as it was told.

The problem isn't than an elected government couldn't extricate the country
from the Euro and return the country to growth, it's that kind of project
would take 9 months minimum and during that entire time the country is
vulnerable to the ECB flipping the switch on their economy and "turning off"
Greek savings and "turning off" international trade and effecting instant 3rd
world status (and not even 'good' third world status).

In effect, Greece has been converted into a puppet state that rubber stamps
European Commission and ECB legislation. They issue diktats to Greece who
rubber stamps them, and they're not even really pretending it's about getting
paid back any more.

~~~
tormeh
>shutting off all forms of payment in the entire country indefinitely

Technically the ECB threatens to stop providing emergency credit. That Greece
has made itself completely dependent on emergency liquidity from the ECB is
the country's _own silly fault_. Are ordinary Greeks to blame? Yes, they're
responsible for the people they elect.

That said I don't think the current situation makes much sense. The odds are
high that the debt will never be paid back and that Greece will never have a
developed-country government. There have been some promising developments
recently, but I'm sure we can all agree that Greece should never have been
admitted to the Eurozone and maybe not even the EU.

~~~
atmosx
As a Greek I'm aghast by fellow know-it-all Greeks who bought in in this _we
deserver what we 're going through_. And it's not just random commentators on
HN, it is an entire political class.

> Are ordinary Greeks to blame? Yes, they're responsible for the people they
> elect.

G.Papandreou who campaigned with the MOTO "there are enough money for
everyone", went around Europe calling Greeks crooked by default. As if every
Greek is a crooked and tax-evading[1] citizen. Then came along Pagkalos of
course, but the same MOTO is rhetoric is re-played time and again by
politicians, just to name a few: A. Georgiadis at "Enikos", A. Loverdos before
him, E. Venizelos and many others have replayed this recurring theme.

I don't believe that there is another country's population, who has received
so much systemic brainwash into believing that it is it's own fault.

You want to tell me that when the Minister of Finance tells me that _our banks
are safe_ (2008), you would expect from the 60-year old public worker to
understand that he is lying and believe otherwise? I don't.

So again to answer your question:

> Are ordinary Greeks to blame? Yes, they're responsible for the people they
> elect.

Fuck no! It's easy to be pissed with the prior generation but it is a
simplistic and stupid approach.

> Technically the ECB threatens to stop providing emergency credit.

I won't enter into details because I'm bored. I've have written thousands of
word regarding Greece, the EU and ECB here on HN and honestly I'm tired. The
ECB was created as an _apolitical_ instrument and it's been since then used
time and again (Ireland, Greece, Portugal) as a political tool by French and
German politician to save their bankrupt banks.

Do you have any idea what is really happenning here[2] ? It's not about
Greece, so hatred should not cloud your judgement. If you don't know what is
happening in this instance, please gets your fact STRAIGHT please.

ADDENDUM: The only politician who got it right about the ECB was M. Thatcher
in her last speech in the house of commons:
[https://www.youtube.com/watch?v=vZZf7cLhPG8](https://www.youtube.com/watch?v=vZZf7cLhPG8)
\- it's outstanding how a right-wing, libertarian politician understood, what
French, Greek, Italian, etc. Socialists failed to see...

[1] The problematic relationship between Greek citizens and the Greek goes
back to 1821 and it's almost exclusively the state's fault. There are cultural
and historical reasons why this is, however, the state still today sees the
average as tax-evader a priori.

[2]
[https://www.youtube.com/watch?v=2x7FTH_ZIsU](https://www.youtube.com/watch?v=2x7FTH_ZIsU)

~~~
linkregister
> I don't believe that there is another country's population, who has received
> so much systemic brainwash into believing that it is it's own fault.

The German people have had a significant amount of education about their
culpability in the events of the second World War.

------
yagodragon
I live in Greece and things are bad but as a matter of fact, the real problem
is that we ,the Millennials, feel that we're screwed because we compare
ourself with our parents. Our parents and our politicians really scammed the
whole europe into believing that we have a strong economy but the truth is
that everyone avoided paying taxes, they got huge loans that could never pay
of and our politicians where really corrupted ,as well. The result was that
our parents made a fair amount of wealth without having the skills and the
education of the rest of europeans. They worked hard, but they lived in a
bubble. I believe that the biggest problem in Greece is that right now we are
in a declining economy and probably wont succeed economically as our parents
did. We are going from high to low and we cant see whats following.

~~~
SocratesV
Went to Crete a few years ago and was surprised by the number of (what seemed
residential) buildings with unfinished roof/terrace, but otherwise being used
and perfectly normal. You could see the concrete pillars with the steel bars
coming out on top.

Imagine it is some kind of way to dodge taxation since it is still considered
unfinished?

Have also read Michael Lewis' "Boomerang", which also has a lot of similar
anecdotes about Greece (and Iceland, Ireland, etc).

~~~
return0
How many years ago? You might be experiencing the property boom - everything
under construction with cheap loans from a careless ECB. It's not a way to
dodge taxes. Many of those constructions were finished, others stayed halfway.
What many of them have in common is they are looking for buyers.

~~~
SocratesV
This was fairly recent, 2013. The houses were otherwise perfectly good.
Painted, with normal windows, normal doors, etc. Didn't seem like a they had
been "completed" on a best effort basis (non-matching cheap windows, dodgy
doors, etc).

------
saiya-jin
> "And yet, the leftist government recently proposed adding further documents
> and costs to selling or renting property — a compulsory “energy performance”
> certificate and a civil engineer’s assurance that there are no illegal
> constructions."

Not an expert, nor a citizen/resident, but these seem like a basic things to
do. Parents back home had to provide same things recently just for renovation,
and much more.

There are laws to address this, albeit considered kind of a joke in southern
Europe for a long time. People would build whatever they wanted, hack together
unsafe constructions to cut costs, then bribe an official to validate all of
that. Then earthquake comes and people die. Standards for buildings are
reactions to disasters, I don't see anything wrong with it.

Or am I missing something?

~~~
liotier
Energy performance certificate, non-toxicity certificate, surface certificate,
non-pledge certificate... The basics of a real estate sale in France - they
make the transaction more transparent and I'm glad they are mandatory, both as
a former buyer and a former seller... They remove a lot of the friction that
distrust creates. Framing it as "red tape" that “threaten to turn the country
into an endless ‘property graveyard’ where nothing will be sold, nothing will
be bought and nothing will be rented” is laughable !

~~~
Spooky23
That statement is a little dramatic, but these sorts of things have severe
impact.

Upstate NY is a great example -- property taxes are oppressive, and while
property does sell, the value is kneecapped because the tax costs are so high.
In my city, a house in a nice area valued at $200k (which is a 3-4 BR, 1-2 BA
house) is taxed around $6000-6500. So a typical homebuyer who needs a mortgage
automatically loses around $550/mo in buying power. In a suburban area, those
taxes are $4500-5000, which boosts the value.

At the macro level, it's more insidious. With multifamily property, there's
little incentive to maintain property, so the business model in urban areas is
to suck as much value out of the property as possible, stop paying the taxes
and let the county sell it at auction. The lower tier of scum landlord buys
these properties, restores them to minimum code compliance and rents them to
subsidized tenants.

~~~
sliverstorm
The first part at least sounds like things are working like they are supposed
to work. The same thing happens with interest rates. But we wouldn't say
interest rates "kneecap" property value, would we? They're just a fact of the
market, and mostly just alter where the money flows to. The buyer commits to
$1,000/mo in payments- with high interest, the bank gets more and the seller
gets less. With low interest, the bank gets less and the seller gets more.

Why is there little incentive to maintain property? Just because it's worth
"only" $200k?

------
delegate
The system is fucked beyond repair.

There is no 'Greek' system or 'English' system - it's all the same, it's all
interconnected - so someone in Europe must _live_ the consequences of
political decisions in China or the United States or any other country,
really.

And that's to be expected, because the system was not 'engineered', but hacked
together in time - sometimes in response to crises, sometimes influenced by
insane political promises or compromises, sometimes by greed or fear.

Yet we try to fix the problems in each individual 'state' \- this might work
for some problems, but for others - the ones faced by countries such as Greece
- it's hopeless - the solution (if any) might not be in Greece at all.

This is the rare case when refactoring just doesn't cut it, we need a complete
rewrite of the whole thing.

~~~
elcct
I think faults in each country have one thing in common - socialism and
excessive bureaucracy that comes with it.

~~~
soVeryTired
Socialism is a spectrum. Are you talking about full-on soviet communism? The
Scandinavian model? Venezuela? The national health service in the UK?

I'm don't really think that socialism == bureaucracy == failure is a cogent
argument.

~~~
elcct
You can compare socialism to cancer. Some forms of it are terminal some are
not, but it is not sustainable thing to have.

------
tormeh
I found the OECD's executive summary for Greece (2016) for context:

#The economy is gradually recovering from a deep recession but high social
costs persist

Following a deep and prolonged depression, during which real GDP fell by 26%,
the economy is projected to grow again in the course of 2016 and 2017, but a
full recovery will take time. Competitiveness has improved markedly, but
exports and investment remain weak. The unemployment rate, at 25%, is still
high despite a moderate decline since 2013. The depression has pushed many
people into poverty and income inequality has increased. Tax and benefit
reforms have materially improved the budget position, but the burden of
adjustment has been uneven and public debt is still very high. The banking
sector has recently been recapitalised, but credit creation remains weak due
to the high burden of non-performing loans on banks’ balance sheets, and
reduced demand for loans.

#Significant structural reforms have been legislated, but their mix and
implementation were uneven

Greece has implemented significant labour market reforms, but progress has
been less on reducing oligopoly power, the regulatory burden and weaknesses in
the public administration, due to administrative capacity constraints, little
ownership of past reform programmes and vested interests. The depressed
economy, lack of bank finance and remaining structural impediments are holding
back the modernisation of the Greek economy.

#Stronger exports and investment are a key to sustained recovery

Remaining structural barriers and administrative burdens raise costs of
exporting. Greece’s integration in global value chains is low due to
insufficient investment in human and knowledge-based capital, low inward FDI,
the small size of enterprises and the manufacturing sector and weak
infrastructure. Network industries have been liberalised but the still
restrictive regulation of the energy and transport sectors reduces trade in
both goods and services.

------
simosx
Some examples of inheritance would be either old houses at the village or
small olive groves.

Many old houses at the village are derelict and the small olive groves have
little financial value. The olive groves are generally small because they have
been divided among the children through the generations. If an olive grove is
not tended for 5-10 years, it becomes unusable and costly to fix.

~~~
dualogy
> Many old houses at the village are derelict

Ooh, damn, that might require some time investment and manual labour! What is
this, the 20th century? Dump this rotten crap!

> If an olive grove is not tended for 5-10 years, it becomes unusable and
> costly to fix.

Ooh, damn, that might require some time investment and manual labour! What is
this, the 20th century? Get outta town.. ;D

~~~
saint_fiasco
It also requires capital, which is hard to get in Greece. Who is going to lend
them money for the repairs?

------
cpr
Gee, in the US, all property is debt as well. (Property tax.) So you don't
really own your property--if you fail to pay, you will ultimately lose
possession.

[http://taxation.lawyers.com/property-tax/when-you-cant-
pay-y...](http://taxation.lawyers.com/property-tax/when-you-cant-pay-your-
property-taxes.html)

~~~
naveen99
There are tax exempt properties like farm land and of course property owned by
non profits.

Not sure why countries like india leave property tax on the table.

~~~
pradn
India does have property tax.

[https://en.wikipedia.org/wiki/Property_tax#India](https://en.wikipedia.org/wiki/Property_tax#India)

~~~
naveen99
You are right that it exists. But collections are about 5x less than oecd
countries.
[http://icepp.gsu.edu/files/2015/03/ispwp1321.pdf](http://icepp.gsu.edu/files/2015/03/ispwp1321.pdf)

------
SamUK96
This is what happens when you allow uncontrolled and unregulated asset
transfers. There's a reason that pretty much any index/stock in the world
freezes when the daily drop exceeds a certain threshold (i.e. Japan, JPX, has
a limit of usually ~7% [1]).

This prevents panic selling and even though seems like a "delaying-the-
inevitable-drop" cop-out, it really does work.

Greece Government are stupid as hell for letting everybody sell their homes
all at once. Mass selling off in a region will just cause the housing market
to death spiral, just like it does with stocks.

[1][http://www.jpx.co.jp/english/equities/trading/domestic/06.ht...](http://www.jpx.co.jp/english/equities/trading/domestic/06.html))

~~~
TorKlingberg
You cannot reasonably charge high property taxes and then stop people from
sell property they do not want.

~~~
cgio
By imposing high property taxes you make selling harder.

------
simosx
Apart from inheritance, the parents can also set up a form of "parental
donation" of their property to their children, but continue to make full use
of the property (live on the property or keep all the rent) as long as they
are alive.

And the difference between "inheritance" and "parental donation", is that the
latter was set up decades ago when it was cheap to do so.

What you are reading in this article is cases where they did not plan for the
future.

In addition, the article does not provide information about the condition of
the property. In many cases, the property would be an old house at a village
that may not habitable or small olive groves that have little value.

~~~
StavrosK
> What you are reading in this article is cases where they did not plan for
> the future.

Weird how that sentence became what it is with the benefit of hindsight. If
things had gone the other way, and inheritance was cheaper than parental
donation, you'd be saying "those chumps donated when it was more expensive and
did not plan for the future".

It's easy to plan for the future when you already know what it will be. In
other cases, I wouldn't be so absolute.

~~~
simosx
The wording could have been better.

My stronger point in the reply should be my hunch that many of the
inheritances may not be profitable enough to pay the inheritance tax. There
should be an article that dives into those rejected inheritances and figure
out what exactly was not accepted.

------
imaginenore
The article mentions the word "tax" 14 times, but it never says what it
actually is.

How bad is it?

~~~
drunken-serval
[http://www.globalpropertyguide.com/Europe/Greece/Taxes-
and-C...](http://www.globalpropertyguide.com/Europe/Greece/Taxes-and-Costs)

It looks like property tax tops out at 2% annually of assessed value. This is
similar to tax rates in Wisconsin, but if they play the same games in Greece
that some local governments do, the properties are assessed well above
anything you could sell the property for.

~~~
ferongr
They probably do. My apartment was made in 1963, 63sqm (670sqft). "Zone price"
(i.e. what the government considers the price of 1 sqm of development in a
certain region) is 1100 euros, building age multiplier for that is 0.60 so we
end with a 660 euro/sqm pric, for a total assessment of 41580 euros.

I'd be lucky if I got half of that If I actually tried to sell it at the
moment.

~~~
webscaleizfun
What area are you in? Compared to Seattle/Portland/San Diego prices, 40k euros
seems cheap for a 1963 670sqft apt. A similar house in Tacoma would run 110k
euros right now, and it is a terrible location.

~~~
ferongr
It's in Kallithea, a generic south-European concrete-jungle urban center.
Also, I'm not sure it's fair to compare property values between the US and
Greece. The average person working on the private sector would be lucky if he
made $10000/year at this point in time.

~~~
webscaleizfun
Perhaps property value is in line then if 40k euros is an inflated price, I
think 110k euros in Tacoma is a price too high for that area myself, the
average income down there is around 22k euros a year for a working person [1].

[1] -
[http://www.bestplaces.net/economy/city/washington/tacoma](http://www.bestplaces.net/economy/city/washington/tacoma)

------
esbranson
On the subject of "law courts", I wanted to ask: Are Greeks able to even
(practically) read the codified laws and regulations of their country online?

I ask because this is still pretty difficult in America, as most state and
local law publishers do not publish them as (free) ebooks and make it hard to
use their websites for anything but a reference. (I.e., it is difficult to
read the law through and through online, as versus looking up individual
sections.)

~~~
kkapelon
No they are not able.

Lawyers are the ones who have all the power on this aspect.

------
Fifer82
Half of Europe has dreamworld house prices which are unsustainable. As the
boomers die out, the demographic changes are going to annihilate the fools
today, taking out 450k for a bedsit. I have to say, I am looking forward to
the peasants-turned-property-magnates getting a rude awakening :)

------
jbmorgado
If you have no money even to pay the property taxes, what money do you have to
even improve the economy with that property? Should we praise that the lands
just stay there with no output?

Property taxes have this interesting economic plus side: It stops being
profitable to just _amass wealth_ , instead, you have to use it to create
wealth in order to keep it.

Also, unlike what people in the comments are trying to make of it, countries
high property taxes in EU are in good economic condition, like Luxembourg and
the UK where they are respectively 1.5x and 2x what they are in Greece. In
fact all the countries with high property taxes from OECD are amongst the top
economic performers of OECD.

[https://data.oecd.org/tax/tax-on-property.htm](https://data.oecd.org/tax/tax-
on-property.htm)

It should be clear just from that, that there is absolutely no correlation
between high property taxes and a bad economy.

------
rcthompson
Funny to see so many commenters here making suggestions (e.g. "just sell the
property") that assume Greece has a well-functioning economy, when the problem
is that Greece doesn't have a well-functioning economy.

------
kartickv
If the tax is more than the sale price, clearly the tax system. Tax should be
limited to a fraction of the sale price, say no more than a third. That seems
like a common-sense reform to do.

------
nerdponx
Why have taxes been rising? To pay off all that debt?

~~~
onion2k
Austerity (deep cuts to government services) and tax rises were the conditions
imposed on Greece as part of a series of financial bailouts from various
national banks around the EU. The Greek people had riots over them, and a
change of government in September 2015, before there was a consensus that
there was absolutely no other option but to go along with the steps required
in order to get the bailout money.

~~~
Shivetya
Yet Greece is still overspending in regards to propping up its social security
compared to other EU nations. Courts have regularly blocked reform attempts.

So now they have both high unemployment and high taxes, the latter discourages
if not out right prevents new businesses from starting. You cannot recover any
economy by taxing your way out of your malaise

~~~
mfukar
> Courts have regularly blocked reform attempts.

That is quite simply a lie. Recent GR governments have not pushed for pension
or social security reform, only cuts in spending, all of which the Parliament
approved and set into effect _immediately_. As far as I know they're all still
in effect.

------
dalore
So as a foreigner, now would be a good time to buy some Greek real estate?

~~~
kkapelon
In my opinion yes. In fact I would tell you to wait because prices may become
even lower.

------
mjevans
NYT == Paywall == they don't want me to read the story.

I'll gladly enjoy the comments, but this is my protest at allowing sources
that are paywalls (except, perhaps, if a given story is in a fully public
section).

------
anovikov
Greek economy was a scam. There is really no way to help them now. They fooled
the entire world to get the unearned prosperity of the 00s.

~~~
simosx
This is a superficial comment. How does downvoting work here?

edit: (requires karma level > 500)

~~~
etatoby
Downvoted it for you.

Greeks didn't scam anybody, on the contrary, they were scammed by EU leaders
and bankers. After signing the EU pacts, there was little their politicians
could do to avert the catastrophe (and what little they could, they still
didn't.)

~~~
anovikov
Well, their politicians rigged the books to get into the treaties in the first
place. Things won't be so catastrophic for them (as they weren't for anyone
else in 2008-2009) if they didn't report lies on their financial well-being to
get accepted.

Why doesn't thing go bad for Poland? Or Czech Republic? Because their finances
are solid, not based on vaporware, and they don't lie to the world and
themselves to get short-term benefits. And they actually work.

------
thght
This is not only about Greece, a house is a basic necessity of live, wether
you can find a job or not. Governments should cap the price per square meter
so a house will always be available for everyone.

As it is now you cannot really buy a house, you need a mortgage for live and
work your entire life to pay interest. If this continues every house in the
entire world will become unending debt and ever more unattainable, except for
the rich of course.

This is also why basic income could never work in practice, as the house
prices keep increasing you'd also need to increase the basic income. And where
goes the money? Indeed, to the rich property owners..

~~~
hx87
Price controls are a terrible solution except in special and temporally
limited circumstances, e.g. total war. Much better to make construction as
easy and cheap as possible, i.e. no quantitative limits on it.

> This is also why basic income could never work in practice, as the house
> prices keep increasing you'd also need to increase the basic income. And
> where goes the money? Indeed, to the rich property owners..

If that actually happens, then it's pretty simple to fund basic income
entirely from property taxes.

~~~
thght
> Price controls are a terrible solution

I never mentioned price controls in general.

In Auckland, New Zealand, investors are buying property and houses en masse.
They blow up the market price for profit. In the news you can read that most
people born now in New Zealand will likely never be able to buy a house in
their lives, and this is a very hot issue there right now. It has never been
this bad and it only gets worse every day.

If the price per square meter never exceeds for example 0.25% of the average
minimum income, most people should be able to own a house. Property owners
could than make profit on the quality of a house, which is fair enough for
now, but not anymore on the square meter property price.

How can it be that you are born on this planet and not being able to ever have
your own place? Because it is all owned and inherited by a handful of people
that took profit of a flawed system?

~~~
hx87
> In Auckland, New Zealand, investors are buying property and houses en masse.

That isn't exactly a bad problem to have--if free construction is allowed and
property taxes (or better yet, land value taxes) aren't constrained, it would
be fairly straightforward to fund a significant portion of the governments'
budgets, plus a basic income or rent subsidy, by a taxing foreign investors.

