The Guardian article. Is DC immune to this London market phenomenon?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Many cities have "homestead" exemptions, which are property tax cuts for people who actually live in their homes.

All it takes is for a politician to say that we should "cut property taxes" for residents. Everyone will vote for it since the absentee landlords live in Russia and the Middle-East. Then raise property taxes on everyone else. If the absentee landlords are happy paying extra property taxes, then fine. At least they are contributing extra to the city's budget.

The problem is that the "homestead exemptions" are also a means for landlords to pay more taxes. Typically people who own rental houses/property are more affluent and politically connected. So I doubt it would be able to pass. If you tried to only make the tax apply to "vacant"properties, then there is the question of what makes a property "vacant" and how do you prove it?

My understanding is that in Vancouver they passed a tax on foreign buyers. I am not sure that such a tax would be legal in the U.S., particularly considering that the U.S. has Bilateral Investment Treaties with most countries that typically prohibit this type of targeted taxation of foreign investment. It could also potentially violate the equal protection provisions of the 14th Amendment.

DC already has both homestead exemptions for owner-occupiers and vacant property tax rates. If you're not using it, the annual taxes quickly increase by 3-4x. We have some FDI in real estate in DC, but it's mostly in CRE and residential development. We don't get a lot of foreigners using DC apartment to "wash" their money. Frankly, the values are too low! A $10 million home in DC sits on the market for a looooooooong time. They want to be able to sell quickly, in case they need to liquidate. NYC, LA, and even Miami is a much better market for these buyers.

[Anonymous]

Earlier article from the Guardian on vacant, abandoned mansions in London. Such a waste.
https://www.theguardian.com/society/2014/jan/31/inside-london-billionaires-row-derelict-mansions-hampstead

[Anonymous]

My understanding is that in Vancouver they passed a tax on foreign buyers. I am not sure that such a tax would be legal in the U.S., particularly considering that the U.S. has Bilateral Investment Treaties with most countries that typically prohibit this type of targeted taxation of foreign investment. It could also potentially violate the equal protection provisions of the 14th Amendment.

That would never work here - the foreign buyers would simply form an American shell company LLC.