> For journalists, it requires undertaking a tremendous investigative effort to find the real owner of even one property, let alone millions.
Whether the property is vacant or not, the tax must be paid. But if you actually pay taxes for working here, it’s cool.
(And if not, could you post a better link?)
A large investment property would probably cost several tens of thousands of dollars in property tax per year? Not many residents probably pay that much income tax, what do you do with those?
So the wealthier you are, the more income tax you pay, so the lower your property taxes are?
So this would benefit the wealthiest?
What about old people who bought the house long time back when it was cheap but dont have good source of income to pay the inflated tax?
I never understood why people consider equity to be essentially equivalent to liquid money.
Given the wide range of possible incomes to various professions, this can be problematic. Your $7.25/hr federal minimum wage worker ($14,500/year) competes against a $290k/yr SV tech worker, with 20x the income. Unless that's mitigated by other factors (residence size, amenities, etc.), a land tax might prove further discriminatory.
But in general, a tax that's sufficient to kill the prospects of real estate as simply a bankable nonproductive asset would be a net benefit.
Half-exemptions for rent-seekers who can prove 90%+ occupancy.
One of the notions behind property tax is to make efficient use of land -- someone simply squatting on a property and not contributing to the local economy is a less efficient use than someone who's actively engaged. In particular, high-density uses are preferable to low, where land value is high.
That conflicts with the notion of neighbourhood and social stability. Kicking out pensioners (or young families) simply because they cannot afford to pay taxes ... is highly disruptive. For a sufficiently growing market, it need not be a necessary problem, tough much experience with gentrification (or its less genteel earlier forms of land appropriation and expropriation) show.
One possible compromise is to allow taxes to accumulate, but to factor against the value of the property itself. When the property is sold (or transfered in estate), those taxes come due, and are debited agains the value of the property. You don't evict those unable to pay, but the benefits of squatting do come with an (ultimate) cost. That cost is also a bankable asset to the government authority, who can consider this a future receivable.
Your comment makes it sound like the Gov't would start requiring some incredibly invasive monitoring. I think it more likely would merely require documentation and sworn statements similar to what we have long done with just about everything that is taxed.
I believe the BC law exempts empty yet available (for rent sign).
Your going to have to have an army of govt workers checking the validity of all claims they aren’t empty.
Jesus. Rat on your neighbors? Sounds like the Stasi.
A permanently absentee landlord is not a neighbor, and reporting a vacant lot next to my home is not ratting.
To be effective, they probably need to have the tax rates on an elevator until the market corrects though.
At a later point when renegotiating, I was given one of these dangerous contracts to sign. When I brought to light my concerns, said lawyer set up a face to face with me. His first words were, "If you weren't an engineer, you would have made a good lawyer."
Boggles the mind.
It'd be such a lead forward in transparency if 'bugs' (loopholes), authors, and proposed changes were out in the open -- and the history and reasoning behind them equally public.
In theory I think this is the way many countries legal systems already work: the case law and regulations are technically public. But it's generally only accessible (in both the sense of retrieval, and also in the sense of understanding the language) to subject experts.
The only difference is, were the subject matter experts in the domain where GitHub and the likes rule.
At least where I live, court records are accessible to the lay person (after clearing some hurdles). Will anyone look at them aside from lawyers and law students? Probably not...
Greater transparency in lawmaking and governance is always a good thing, though, and most government's don't achieve it to any great extent.
Especially if that very same tax were used to fund first time homebuyer resources.
That is, double the property tax but offer half of it as a rebate to, and only to, people paying the local income tax (i.e. residents)—-including owner-residents and renters on a pro rata basis.
And either FinCEN is not disclosing so it can get to the point of making charges or it's providing cover for those in power. Probably a combination of both, honestly.
Politically it's very hard to address this problem because it benefits existing homeowners (especially those who bought long ago) and developers. Those are two extremely powerful constituencies.
I'm not sure anyway that local workers are fundamentally more entitled to be allowed to buy property than other groups of people who might want to spend money to acquire real property.
I suspect you're trying to make a pro-liberty / property rights point, in which case I think you should consider more carefully the basis of justified property ownership.
Violence is an inherent aspect of human affairs, so the question in every case isn’t whether violence is necessary but rather whether it’s justified.
HNers' LLCs probably have their names on them, they're not anonymous. This article is talking about it not just being the name of a company being in property records, but that the actual "beneficial owner" of the company not being named in the incorporation records.
I haven't looked into the exact details as I've never bought a house but from what I can gather I'd want to wrap it in an LLC.
Also FWIW the Sean Hannity example in the article seems like a weird strawman conflating consumer protection laws with "name and shame" accountability. If it's wrong to evict someone for XYZ reason, that should be protected by the law, not by fear of being "named" as the landlord. [TBC I am no fan of Sean Hannity.]
Land registry is a necessary function of local government. But this is one of those things which was historically only available within a government office, and now can be found in a second on the internet.
Personally I would be perfectly okay if my local government required disclosure of the personal ownership of LLC property owners. But I have no idea if that's constitutional or legal under federal laws.
If you want to know where a person lived pre-internet, you looked them up in a phone book, which is substantially less privacy preserving than looking up the owner of a house.
Well, post-internet, 2FA has been leaked to advertisers.
Person or entity wants to keep invested in real estate to protect assets against market fluctuations and frivolous lawsuits and it turns that real estate is a great investment.
Why is that wrong?
As long as person/entity complies with all laws (including whatever - empty housing tax?) - it shouldn't matter.
FinCEN has the right to know and it does, but it hides this info from public because probably some prominent political figures are in play here.
However in an overall social sense, I do think that residential property investment in itself is wrong because I view housing as a utility and a basic necessity along the lines of water, healthcare, fire/police services and internet.
The issue is actually a simple trade off - whether it's more important to ensure people can own their own homes, or that people are allowed to use real estate as an investment.
I don't blame individual investors for this, but I do support the idea of introducing laws to limit property speculation. Bear in mind that I'm from Australia, where property investment has become a cancer that has drawn money away from productive assets (like startups) and into property, which is relatively speaking non-productive rent-seeking (outside of its effect on the construction and design industries). There's no net output from acquiring debt to buy a house so that you can do nothing but sit on it and flip it three years later for profit.
If those are not paid, government can seize and auction-off the property.
In China, the government owns all the land and citizens merely lease it for 70 years.
Yet even with no land ownership, there is still land speculation.
And more. There is societal good created when people are able to discover who owns property. No piece of property exists in a vacuum.
The whole concept of an LLC is a construct, a fictional entity intended to take the place of a person before the law. It is fundamentally a state created thing, there’s no issue of rights or natural law at stake here. It’s a privilege.
The usual goals stated for allowing corporations to exist at all are shared ownership and limited liability, to enable productive and speculative enterprise.
A single person who wants to hide within that structure doesn’t have any special claim on that right, unless they can demonstrate why the state should allow it, an argument that has to be made on the grounds of increased social good.
If we want anonymous property ownership we should legislate it. We don’t, real estate transactions are usually public.
Regardless if owner is known or not known.
All property records are public. You can go to the city or county and get the names of who owns any property in that area. But now 30% of those properties are owned by companies who's owners can't be identified.
So actually the public is losing access to something they already have. There is public benefit to the land registry being public. That is being lost.
IF you're a celebrity, your place of residence could be identified if these records are public (just takes time/work to collate/search the data).
If you want to hide the property from your spouse in a divorce, the data may compromise it and force you to lose the property in a settlement.
I can see that the data is useful in some circumstances, but i feel the data should be available only for law-enforcement purposes (and taxation purposes), not available for general inquiry.
Your other example of hiding property in a divorce is actually an argument in favor of not allowing this. IANAL but is that legal? If it is legal, and you want to say morality is up to the individual, then it's not an argument either way.
The government has the right to tax you for the land, to buy and sell land, etc. So ownership of land in your community is a matter of the government, sure... But it's also a matter of the people. If the government sells a public park to a private company, wouldn't you want to know that the LLC was owned by the Mayor's brother?
Don't forget that journalists (the 4th estate) are a check and balance on the government. Don't be so quick to give away your rights because you don't see an immediate benefit.
So you're saying... if I've got nothing to hide, I've got nothing to fear?
So if you are going to argue "we should be able to hide the ownership of land", you need a reason.
Sometimes you need to contact your neighbor. If they don't live there (or if you don't live there) that can be hard without an actual name and address.
I manage a rental property. I've needed to talk to all the adjoining properties at some point for fence issues, tree issues, and noise issues. They are all rental properties, so none of us live in the houses (college town).
It's taken me 20 years to collect the contact info of two of the three adjoining properties. We still haven't managed to contact the owners of the property in the back.
Our house is the only one with an actual name and address. The others are trusts or LLCs.
There are many things that are legal but still damaging or wrong. In many cases (including this one, IMO) we as a society should be able to know more about the behavior so that we can deal with it if it’s problematic.
I own that house and I don't want you to know who I am - and this is part of my hard-earned assets protection strategy.
Why your casual curiousity to know is more important than my desire to legally own the property without disclosing information about me to everyone and their cat?
If they want to complain - they can do so to local authorities or local regulators.
Complaining to your asshole neighbor even knowing who he is doesn't help to resolve your issues any better.
Anonymity essentially takes all of that and ejects it. Without a new legal framework to replace it (that you almost certainly will like less because it will both cost more, and demand more access to you by the state), demanding that formal legal means be used in all contacts with you is demanding that your neighbours pay significantly more to achieve mutual ends. All while giving the rest of civil society the brush off: "I've got mine, you can kindly go have a nice day."
Why does it matter if we know or don't know anything?
Why does it matter if we know or don't know who wrote, lobbied, or voted for a bill? Authored a commit? Bought an ad? Wrote an article? Funded a study? Owns a newspaper? Holds a broadcast license?
If someone finds scientific and mathematical proof that say an antibiotic formulation is impossible for a prokaryote to develop resistance to it doesn't matter if it was done by a respected winner of a noble prize, funded by a meat industrialist who wanted everyone off of his ass about antibiotic usage, or a crackpot who stumbled upon something right for utterly wrong reasons. If it is right the origins don't matter.
In practice however we don't and the source hints at other aspects including conflicts of interest. Perhaps the hypothetical universal antibiotic technically works but allows viruses to proliferate and fill in many ecological niches meaning overuse is still bad even when disregarding digestive bacteria. And perhaps the hypothetical meat industrialist knew that abd covered it up.
Why does it matter if we know or don't know who wrote, lobbied, or voted for a bill?
Bill's are supposed to be created and voted on by "representatives" for the people who elected them. Transparency is how we know if they're doing the job we elect them to do.
Authored a commit?
Code is copyrighted. We should know who wrote it. It can also be helpful for having discussions with the author if needed.
Bought an ad?
I'm for this with political ads to prevent undue influence. I'm actually in favor of banning political ads sponsored by anyone outside the state, including parties. For non political ads I'm not sure if it matters.
Wrote an article?
This is not required.
Funded a study?
If the study is going to influence public policy I think we have a right to know who funded it.
Owns a newspaper?
Same so long as they offer political content.
Holds a broadcast license?
That's a government grant of monopoly on an o thg otherwise public resource. We should know who the government is granting exclusive use to. Same for land ownership.
Required? Perhaps no, but it's common, especially in serious journalism. The reason to do so is similar to the other reasons. Imagine an article talking about an Oil company that is donating money to a charity. If an article is written by a professional journalist with a history of accurate reporting, you are likely to trust it more than if you found out the author was a PR rep for ExxonMobil.
See: recent case of facebook trying to slip in PR garbage as real journalism (including FB CEO calling it "a great piece" without mentioning it was paid for by them) https://www.theverge.com/interface/2020/1/9/21056988/faceboo...
It's not a binary right or wrong.
It's a matter of the negatives -- that come with allowing people to purchase large amount of property anonymously -- outweighing the positives.
As long as person/entity complies with all laws - it shouldn't matter.
Agreed. And one of those laws might very well be: "If you own more than X amount of property (of this type or another) -- you need to disclose some basics about your identity."
Like anything else in the public sphere.
Because money laundering
It's just the casual Joe doesn't and he thinks he has the right to know everything he wants.
The audacity of citizens wanting government transparency over properties in THEIR neighborhoods.
and this in itself bases itself on a whole pile of pre-assumptions about what's right and the proper scope of the state's and individuals' rights should me.
We argue heavily about the dangers of tax evasion but the fact that government consumption of GDP and spending worldwide is at near record levels doesn't deserve reconsideration?
We discuss how "dirty money" is laundered through real estate but how much discussion centers around the sorts of laws that make that dirty money become such in the first place. Many activities that require money laundering are extremely debatable in their illegality, but this gets put by the wayside because money laundering = automatically evil, intrusive laws of all types necessary to stamp it out.
Then there's the whole issue of simple privacy. Yes, maybe people should have a right to at least some financial privacy, even from governments and corporations, let alone their neighbors. Transparency has its benefits but when you've created a taxation and financial monitoring system so pervasively, parasitically intrusive that any private attempt at keeping ones financial assets is considered suspicious, then this might just be a problem with the system, not so much all of those who want a measure of privacy.
It's odd that many in the hacker news crowd, who supposedly value digtal privacy from intrusive ad tracking and the growing tendencies of surveillance capitalism seem to throw the entire underlying philosophy behind these notions right out the window when it comes to elements of financial privacy, for property or money.
In addition to what other commenters have said:
Because some geniuses seeking to freeze time have made it impossible to build more anything at the scale required and therefore land not being used because it's an investment is bad because it jacks up the price of what's left for everyone else and we want to know who's doing that so we can shame them because that's easy and changing laws is hard (edit: sarcasm implied).
TL;DR because zoning fucked everything up.
Zoning laws and feces covered SF streets are not XYZ's fault.
We all know whose it is.
The results are disastrous :
Stockholm, a fairly small city by global standards (~1.5M in the central area) is extremely hard to get a place to rent. It has been for 20 years.
Is it useful to reduce a situation which clearly has multiple driving factors - to just one factor?
The anonymity is a major issue though, as is the practice of having large numbers of properties sitting vacant (presumably because they were really bought to launder money.) The article suggests some solutions to the first. I feel like some form of “unoccupancy tax” could address the second, all though designing it to not just punish distressed areas seems tough.
The LLC have a name, it is an legal entity. It is owned by other people/financial structure just like Coca Cola, Alphabet or Amazon. Since it's private, you don't get to know. All of these are perfectly legal and to declare this case as illegal is opening a can of worm on the other side.
The asymmetry in the costs of setting up such a structure vs decoding it works only for the “bad guys” as far as most society is concerned.
(Parent post was substantially edited after this comment, so it makes less sense now.)
Someone owning an investment property to help fund retirement seems reasonable. Someone owning thousands does little for society and likely hurts it.
A single extra home rental being less profitable will exist "naturally" as a matter of economies of scale essentially with fixed cost component redundancy.
Income inequality and imbalance of market influence (if one person owns 90% of real estate their high level of control can't even be called disproportionate because they actually do have that large of a stake) seem like issues better addressed by straightforward income taxation and antitrust respectively.
There’s a name for that idea and it was quite popular in the past, with many famous people believing in it. Tolstoy, Huxley, etc.
>(Georgism is) an economic ideology holding that while people should own the value they produce themselves, economic value derived from land (often including natural resources and natural opportunities) should belong equally to all members of society.
> Advocates of land value taxes argue that they would reduce economic inequality, increase economic efficiency, remove incentives to underutilize urban land and reduce property speculation.
Even if you think the perpetuation of capital unfair the realities need to be acknowledged in order to even begin to think of a viable alternative.
I lived in houses rented by these part-timers and they were pretty haphazardly managed compared to the [fewer] times I lived in clearly corporate-owned and managed properties.
At the same time, the ability to hold a property as an LLC, thus limiting overall liability to the property value alone in the case of a lawsuit, incentivizes more individual investors to purchase rental real estate. In many instances these assets help facilitate retirement savings that are more stable than market securities.
I’m all for transparency - and it’s likely the increase in LLCs could be attributable to more savvy, legitimate investors rather than only attracting wrongdoers.
LLCs don't limit liability resulting from negligence, malpractice, or other personal wrongdoing, which may be germane in a lawsuit over something besides unpaid debts.
It is already kinda deranged that one's name and other details become public records in many states as soon as you buy property or start a company.
EDIT: Surprising number of downvotes in a forum that often focuses on privacy concerns!
The meta-conversation going on within these threads is more to the point of folks suggesting hard-to-implement laws about who can own what, and how much of a thing they can own, and what sort of penalties exist to control the way that the population of owners can develop.
All that secondary stuff seems too chaotic to control... better to just -
a> allow for the LLC to do what it was designed for: protect the owner from liability beyond the cost of the house
and, b> let the municipality fine the LLC according to whatever rules exist about whether it's morally reprehensible to remove a renter for failing to pay a fine
I am a first time buyer and I am finding it hard to buy, despite making six figures a year
Most are derelict or unoccupied, and in very expensive areas if you were to buy. Properties are not owned directly by the Catholic church, but by local parishes or diocese, i.e. subsidiary corporations that are controlled by them. This is no different than the situation in Vancouver, except the church doesn't need to pay any taxes :D
That's ~50% of GDP.
Worrying about a few homes here and there is quite pointless against this backdrop.
Are we that different from the Soviet Union?
Nearly all critical infrastructure in the form of homes (zoning), roads, water, and electricity and related services are centrally planned.
It is almost impossible to do anything outside of a municipality, which didn't used to be the case.
Without this central planning failure it would be impossible to "take advantage" of any market, as home builders would just build homes until the "launderers" run out of cash.
reducing incentives toward central planning would remove downward pressure on decentralizing systems. I vote for more decentralized systems.
Turns out it’s not actually an improvement though.
$500/mo rent and much better quality of life than a similar $4000/mo place in SF.
> Turns out it’s not actually an improvement though.
I have been to several. If you are trying to make some sort of direct comparison, your argument seems inadequate, as there are so many differences impacting economic activity.
There are many reasons NOT to own a piece of Real Estate under an individual name, under a trust (for estate purpose) comes to mind and it's now very cheap to do and the public in general is more educated on it; so that alone accouts for a large chunch of declining in % of homes owned by individuals.
Then there are the Real Estate investors/entrepreneur landlord and flippers; who for liability purposes use LLCs.
And yes LLC need not to disclose the name of their unitholders (shareholders). So what? That is not a problem.
Yes money laundering is an issue, but picking the fact that LLC (and Corporation) are not required to disclose the name of their shareholder is not an issue. In some part of the world, those are called "Anonymous Society", sounds cool, but it ain't inherently bad or malicious.
Can we have better writing and reporting instead of these emotionaly-driven pieces?
Why isn't it a problem?
> Tenants can’t figure out to whom to complain when something goes wrong. Local officials don’t know whom to hold responsible for code violations and neighborhood blight.
That seems like a problem to me.