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1) Making the residency requirements to avoid being a resident of NYC (and thus avoid paying NYC taxs) much more stringent, as has been done in some other cities that attract wealthy "non-residents" like London. This could defintely raise a boodle of money
2) Getting fairer assessments on the super-high end real estate sprouting in Manhattan--which is largely bought by non-residents.
"Not only do wealthy nonresidents escape income tax liability in New York, but their property taxes are extremely low compared with the value of their real estate, and they end up paying a much lower rate than owners of much more modest homes, as The New York Times reported last year.
That’s because ultraluxury buildings are assessed at ludicrously low percentages of their actual value under the arcane state laws that set real estate valuations for tax purposes. Apartments in 15 Central Park West, for example, are valued for tax purposes at an average of just $332 a square foot, even though actual sales there have averaged more than $7,000 a square foot. An apartment that sold for $88 million to a Russian billionaire (which amounted to nearly $11,000 a square foot) was valued at a mere $2.97 million for tax purposes. Property taxes were only $59,000 in 2012, thanks to the low valuation and a tax abatement.
The same article revealed that an apartment at the Plaza Hotel that sold for $48 million last year was valued for tax purposes at $1.7 million, or 3.5 percent of its sale price. A condominium at 80 Columbus Circle that sold for $30.55 million last summer was valued at $2 million, or 6.5 percent."
I think these two things together would be interesting. Either the super-rich globetrotters stay away -- in which case housing prices would fall and developers possibly build more middle-income housing --or the super rich would stay and just pay the extra freight, which would help city finances. Seems like a win-win to me.
Last edited by citylove101; 11-01-2013 at 11:34 AM..
If they stay away it could effect jobs and small business in manhattan and drop apartment values for the middle class .
you are possibly reducing the numbers of those that spend the most here.
That would be a lose-lose.
just look at the hit the city takes when the big spenders on wall street cut back .
regardless, developers will avoid putting up middle class rentals. if anything co-ops and condos would go up instead.
developers have not built a middle class rental which is not some sort of special situation since the 1970's.
Last edited by mathjak107; 11-01-2013 at 11:21 AM..
If they stay away it could effect jobs and small business in manhattan and drop apartment values for the middle class .
you are possibly reducing the numbers of those that spend the most here.
That would be a lose-lose.
just look at the hit the city takes when the big spenders on wall street cut back .
regardless, developers will avoid putting up middle class rentals. if anything co-ops and condos would go up instead.
developers have not built a middle class rental which is not some sort of special situation since the 1970's.
Think this way---when RE market drops, it frees up a lot of money for local NYC residents which will allow them to spend else where to support local business.
With high RE price and rent, it makes the paper value of NYC local residents high but they cannot capitalize on that because they need a roof to live under. On the other hand, for non resident rich house hoggers, they collect a lot of rent money from NYC local residents and reinvest to push up the RE market and rent, which starts a vicious cycle for NYC residents.
This has to be regulated for the good of the majority of NYC ppl.
The non-resident buyers (domestic and foreign riches who have tons of money) in NYC is the deadly driving force of NYC real estate. These animals buy houses as kids buying transformer toys---they buy and collect them, which depletes the supply of houses on the market. The city can continue to build, but right at this moment, foreign money is pouring in to NYC to snatch up whatever is new and good location. News had it that Bradley and his model mistress just bot a huge lux condo in manhattan and you know how much they will use their new home. The riches are buying more than just a handful, and for them, it does not matter if they rent their houses or not. So the illiquidity of NYC RE market is going to deplete the house supplies and drive the working class people crazy and out to the undesirable areas.
Who knows, ENY might become the next Williamsburg in 5-10 years.
Quote:
Originally Posted by leoliu
Part of the RE market problems is derived from the polarized wealth distribution in the country. The few riches have more than enough to manipulate regional/national markets and politics, be it the RE market, the stock market, or foreign policies. Remember how much human right issues dominated the american media about China/North Korea a decade ago? How much do you hear or read any discussions about it nowadays? Is it because that these countries have cleaned up their acts? No, it is because the riches are busy with establishing business networks with the corrupted governmental officials and therefore they have no time or interest to flare up the human right issues. The communist power corrupts have successfully reconciled with the mainstream american politicians and corporate leaders by offering all sorts of benefits in exchange of shutting up about their internal affairs.
From what I could see, RE market in NYC is heading in the direction of those in major cities in China, where a few rich people buy up dozens/hundreds of houses to control the supply end for future manipulations of the RE market. For average americans, it is risky to either jump on the band wagon for a joy ride then crash or stay put and miss the ride for ever because those with money make the rules which are hard to figure out.
Not quite right, when real estate drops everyone who owns feels poorer and spends less.
NYC is a different story. I do not have any stats on the home ownership in NYC but I know it is way lower than in suburbs. One can understand that the single largest expense for most NYC families, much larger than elsewhere, is rent. Say that one could lower the rent to 5 years or earlier level, that would free up 20-30% of rent money for millions of NYC residents to spend elsewhere.
If they stay away it could effect jobs and small business in manhattan and drop apartment values for the middle class .
you are possibly reducing the numbers of those that spend the most here.
That would be a lose-lose.
just look at the hit the city takes when the big spenders on wall street cut back .
regardless, developers will avoid putting up middle class rentals. if anything co-ops and condos would go up instead.
developers have not built a middle class rental which is not some sort of special situation since the 1970's.
this on a small minority of rich people who don't live here much. I don't see how they'd affect jobs and small businesses. It would also discourage developers from build super-luxury buildings and instead more modest upper-middle class buildings.
it is not as small as you think. many co-op owners in manhattan only live here part time.
but anything that effects prices has all ships rising and falling with the tide.
markets rise and fall with perception , not the actual event.
the fear that demand could fall on high end stuff would have prices falling across the board.
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