You’ll never teach a liberal about unintended consequences or second order effects. They may have fancy degrees, but they’re just not very smart. From Tyler Durden at zerohedge.com:
In November 2022, Los Angeles voters approved a so-called ‘mansion tax,’ which slaps a 4% sales tax on properties sold for over $5 million, and 5.5% for those over $10 million.
The scheme (Measure ULA), put forward by Democrats, was projected to raise roughly $672 million in its first year, to be used for affordable housing.
Not only did the plan fall short by hundreds of millions of dollars (raising just $215 million), the measure caused residential building construction to plummet, raising housing prices even further, the Washington Examiner writes, noting that the tax doesn’t just apply to large homes in Bel Air, “but also gas stations, commercial real estate, condominiums, and apartment complexes.”
Los Angeles real estate brokers say the $5 million threshold means the new ULA tax will hit just about any apartment complex with over 15 housing units. This has discouraged lenders from offering mortgages on, and developers from building, the very multifamily projects the city needs more of to reduce housing costs. Since nearly two-thirds of homes in Los Angeles have asking prices of at least $1 million, working-class families must often rent multifamily homes to live in. CoStar analyst Ryan Patap noted that developers are further discouraged by the city’s “broader political shift in the city that’s more supportive of restrictions on landlords and more supportive of protections for tenants.”
Around the state as a whole, multifamily housing has trended above the national average. Whereas new multifamily housing permit authorization fell nationally by nearly 19% from 2022 to 2023, California’s only decreased by 5%. But in Los Angeles County, authorizations dropped by 19%, and in LA city, they slumped by a staggering 24%. The mansion tax appears to be to blame. -Washington Examiner
City officials are still slapping themselves on the back, bragging that $150 million from Measure ULA revenues have helped fund programs for short-term emergency rental assistance (for whom?), as well as tenant outreach and education, tenant protections, defense against evictions (squatter defense?), direct cash assistance for low-income seniors and people with disabilities.
They could pass the information about locations along to the replacement burglary gang that knows how to disable alarm systems.
After all, they voted for West South Africa, why not enjoy the CPUSA (D) utopia.
Forward, si se puede!
Stupidity has consequences as Robert Heinlein said.