alt Hacker NewsWouldn't 20% tax on rent just lead to 25% general increase on rents? I don't think there are that much margin around in leveraged landlords.
Really better would be just to bump something like income tax and use money from there for same purpose.
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If leads to building that floods the system with supply then rent won’t increase. Landlords and lenders would have to adjust purchase prices and cap rates so valuations would come down. So this would need be gradually phased in until normal. The government would need to support home builders, buyers and landlords. But eventually the housing stock supply increase would match and be tied to new household formation.
At the end of the day most economic activity is really an exercise in ratios. Some states don’t charge sales taxes. Some change double digits. Yet retailers are able to function in both environments.
What is clear is that rental and purchase housing is increasing beyond inflation since 2008 and COVID and that’s not good for tenants or landlords.
If a landlord can charge 1200 instead of 1000 why wouldn’t they? They’ll charge the maximum they can get away with, costs are irrelevant
Two landlords, one with a mortgage, one without, will charge the same amount for the same property.