If there's a big enough reduction in property taxes, the market will adjust, absent other dominating effects, and your landlord's margin will be reduced.
Also consider that the vast majority of the landowning class consists of a person or family that owns one SFR, and most-to-all of their wealth is tied up in it. Those are the people that will get hurt if they can't keep up with property taxes, and it includes most of the middle class that isn't renting. I rent too. My landlord is not wealthy. If he can't cover his property taxes, then I'm the one who gets the boot.
And lest you think this is mostly a theoretical consideration, there were enough cases where an unfortunate retiree was forced to liquidate that it prompted the California electorate to pass Prop 13, which froze property taxes. If real estate values increase rapidly, for whatever reason, a property tax that rides that slope creates terrible injustices.
> If he can't cover his property taxes, then I'm the one who gets the boot.
That's a funny way to spell rent increase ;)
Forcing retirees out of their homes is pretty unpalatable, I'll agree. However, this is really easily solved through policy: place a tax lien on the property instead of confiscating it. The taxes owed can be collected when the property is passed on and no one gets put out on the street.
And if I and the local market can't bear a rent increase for a time?
A lien has the problem that, for a retiree who probably won't need another credit line, there isn't much incentive to pay. They could just let that go on until they die. Local governments would eventually get upset.
You can pile on all the rules you want, but every rule has unintended consequences. Best not to set up rules that force people out of their homes in the first place.
Also consider that the vast majority of the landowning class consists of a person or family that owns one SFR, and most-to-all of their wealth is tied up in it. Those are the people that will get hurt if they can't keep up with property taxes, and it includes most of the middle class that isn't renting. I rent too. My landlord is not wealthy. If he can't cover his property taxes, then I'm the one who gets the boot.
And lest you think this is mostly a theoretical consideration, there were enough cases where an unfortunate retiree was forced to liquidate that it prompted the California electorate to pass Prop 13, which froze property taxes. If real estate values increase rapidly, for whatever reason, a property tax that rides that slope creates terrible injustices.