From the buyer side of rural land, the part that stands out is how little price discovery there is. Parcels sit for years at asking prices nobody tests, which is the holding-cost point in your book. Curious whether any of the LVT pilots tracked how fast vacant parcels turned over afterward.
So in most of the pilots we do see significant increase in turnover of vacant lots, this was detailed in the pennsylvania cases as well as the historical cases
Thanks Lars - good to know the turnover effect showed up in the pilots too. The Pennsylvania cases predate online listings; today the same shift should be visible in days-on-market data for vacant parcels. George's Singapore example below is a useful variant: taxing an imputed yield instead of an appraised value sidesteps the appraisal problem.
Thoughts on a LVT design that would actually would aggressively surcharge vacant land (without development plans) at a multiple of rental value - basically a defacto ban on holding vacant land for speculation?
Singapore does something vaguely like this, I think - they (speaking from memory) assume a 5 per cent yield on your vacant land, then you pay property tax (commercial or residential - different brackets apply) on that. Perhaps not aggressive enough for your liking, but it might be of interest.
Lars,
You are doing remarkable work to advance the cause of getting economic rent into public hands. It is heartening to see the level of interest.
Thanks!
From the buyer side of rural land, the part that stands out is how little price discovery there is. Parcels sit for years at asking prices nobody tests, which is the holding-cost point in your book. Curious whether any of the LVT pilots tracked how fast vacant parcels turned over afterward.
So in most of the pilots we do see significant increase in turnover of vacant lots, this was detailed in the pennsylvania cases as well as the historical cases
Thanks Lars - good to know the turnover effect showed up in the pilots too. The Pennsylvania cases predate online listings; today the same shift should be visible in days-on-market data for vacant parcels. George's Singapore example below is a useful variant: taxing an imputed yield instead of an appraised value sidesteps the appraisal problem.
Thoughts on a LVT design that would actually would aggressively surcharge vacant land (without development plans) at a multiple of rental value - basically a defacto ban on holding vacant land for speculation?
Singapore does something vaguely like this, I think - they (speaking from memory) assume a 5 per cent yield on your vacant land, then you pay property tax (commercial or residential - different brackets apply) on that. Perhaps not aggressive enough for your liking, but it might be of interest.
I didn’t see the original but enjoyed the update. There have also been some small advances here in Australia, and increasing interest.