How To Solve Overpriced Housing
I believe the government should reduce taxes on an individual’s primary home purchase, while issuing a new “Excess Property Tax” on secondary and additional (unnecessary) investment houses.
House 1: 1%-5% Base Stamp Duty (based on value, as commonly is now)
House 2: Base Stamp Duty + 5% EPT
House 3: Base Stamp Duty + 10% EPT
ETC, at whatever agreed scale rate
Then houses can go back to being “homes” not “investments”, as they were originally meant to be. This is *fair* and *equitable*.
As you are probably well aware, a major problem for most people (especially those under 30) is the fact that houses are so unaffordable and overpriced. The source of this problem (besides inflation) is how our parents generation started hoarding them before we were born back when they used to cost a small fraction of what they cost now.
The EPT will also help remedy various government budget defecits (dear governments, wake up, easy money!).
There will be FAR more winners in this picture than losers, and the losers arent even losing much (“what, you had to pay 5% extra tax on your 2nd home? My heart goes out to you..”). Property prices may decline slightly initially, but that will only make them easier to purchase, which will soon after help create a more balanced, sustainable, and predictable property market which is more ‘bubble-proof’.
This is just a thought I came up with and had to share.. I’d welcome feedback if it’s a good or bad idea. I’m definitely happy to modify the scale or adjust as necessary.