from Hacker News

Vancouver Housing Tax Pushes Chinese to $1M Seattle Homes

by dhirenb on 12/5/16, 3:30 AM with 74 comments

• by adrenalinelol on 12/5/16, 5:30 AM

  There should be similar laws all over. In a global economy, if "regular people" have to compete with multi-millionaires and billionaires who can move capital wherever, whenever they want, housing where any decent paying jobs are located will continue to become more and more unaffordable.

  Please note: I'm fully aware this isn't the ONLY reason for ridiculous housing prices.

• by toodlebunions on 12/5/16, 5:09 AM

  Seattle should immediately enact a 25% foreign buyer tax and an extra annual property tax assessment for vacant foreign owned homes.

  Likewise, Midwest cities that are economically in the dumps could offer incentives to attract foreign buyers.

• by taurath on 12/5/16, 4:55 AM

  From the article, 50% of homes sold in Seattle and its suburbs are foreign investments. That's absolutely insane - totally disincentivising people from actually living there from trying to buy a home. Guess it's time to find another city.

• by nsamuell on 12/5/16, 4:56 AM

  Well done, Vancouver city council! The housing market in Vancouver is totally bananas

• by jaredklewis on 12/5/16, 5:36 AM

  It's strange that there is so much push back against foreign investment.

  Rather than enact a bunch of projectionist policies, wouldn't it be better to just adapt to the investment in a way that benefits natives? After all, when foreign people want to buy something you have, that is called an export, and most people agree those are good for the economy.

  If foreigners are investing in housing, local governments will receive a huge influx of tax income from property taxes. If there is no property tax, then now is the perfect time to add it (or the similar but more progressive land value tax) or increase it. The income from these taxes can be used to fund infrastructure, education, and reduce other taxes like consumption taxes.

  The other thing to when demand for housing in your city is high, is to increase supply. Seattle is not full. The Seattle metropolitan area is 15,000 sq. km with a population of 3.7 million. To compare, the Tokyo metropolitan area is 13,500 sq km, with a population of 37 million. No idea about the accuracy, but this site showed that rents were more reasonable in Tokyo (which matches my own impressions): https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...

  If we are going to take legislative action anyway, instead of a bunch of protectionist policies that will create long lasting opportunities for arbitrage and market inefficiencies, why not just make taxes to help the people benefit from the foreign investment and let development happen to help reduce costs long term?

• by rpedela on 12/5/16, 5:26 AM

  I am beginning to think there is another housing bubble, but this time I am not exactly sure how it would play out if it burst assuming there is one forming. Would it affect the Chinese economy? The economy in each US city? The larger US economy? The global economy?

• by TheSpiceIsLife on 12/5/16, 5:36 AM

  So what happens when foreign owners start voting in council elections?

  At what point does foreign real estate ownership start affecting local politics?

  If imposing a tax has no affect on, or only slows, foreign real estate investment, what do we suppose will be the long term outcomes?

• by bootload on 12/5/16, 5:41 AM

  "The week that the government announced Vancouver’s foreign tax,"

  Which government? Fed, state, municipal?

• by wenbert on 12/5/16, 6:02 AM

  Buy in Auckland New Zealand lol