Millennials simply can't afford to live in OC (Pomona, Whittier: cabinets, lawsuits)

[man4857]

Originally Posted by LuvSouthOC

I support a tax on foreigners buying in OC. My millennial friends made the case to me. For me it really revolves around it not being a fair market when it is so warped...and the children of OC residents having to compete with foreign buyers.

And that's it? How high would this tax be? What will you tax, assets? Income? And what will you use the revenue for?

[LuvSouthOC]

Originally Posted by man4857

And that's it? How high would this tax be? What will you tax, assets? Income? And what will you use the revenue for?

I would ask that the most recent gas tax be repealed in exchange for this new tax. As far as the amount of tax foreigners purchasing real estate would pay, I'm afraid Sacramento would have to make that determination. The tax would be on the purchase price of the property.

[MLSFan]

Originally Posted by LuvSouthOC

I would ask that the most recent gas tax be repealed in exchange for this new tax. As far as the amount of tax foreigners purchasing real estate would pay, I'm afraid Sacramento would have to make that determination. The tax would be on the purchase price of the property.

it doesn't matter... the people who invest overseas, have the money to buy it outright, a one time tax at purchase is just part of doing business

it isn't like they won't factor it in when they sale it later on and recoup it

[man4857]

Originally Posted by LuvSouthOC

I would ask that the most recent gas tax be repealed in exchange for this new tax. As far as the amount of tax foreigners purchasing real estate would pay, I'm afraid Sacramento would have to make that determination. The tax would be on the purchase price of the property.

It's not that hard to figure out the problem.

If the tax is levied based on citizenship, I'd bet you there would be lawsuit against it for discrimination on equal housing opportunity (think, foreign nationals who are here for other purposes but trying to live here permanently) and the courts would strike it down as unconstitutional. So the only way you can levy a tax is through income/assets. Which for high earners, will include both citizens and foreign nationals.

[LuvSouthOC]

Originally Posted by man4857

It's not that hard to figure out the problem.

If the tax is levied based on citizenship, I'd bet you there would be lawsuit against it for discrimination on equal housing opportunity (think, foreign nationals who are here for other purposes but trying to live here permanently) and the courts would strike it down as unconstitutional. So the only way you can levy a tax is through income/assets. Which for high earners, will include both citizens and foreign nationals.

Actually, I was thinking it through. There may be other constitutional challenges to the tax.

Income tax is not possible since they are not even required to file.

[man4857]

Originally Posted by LuvSouthOC

Actually, I was thinking it through. There may be other constitutional challenges to the tax.

Income tax is not possible since they are not even required to file.

Well yes for the majority of foreigners but using income tax does include that group of people who are foreign nationals on a visa, wanting to purchase property.

So in the end, this proposed tax and it's implications might not even be feasible to address the fundamental issue... too much demand and little supply.

So from what I see, you can do a few things.
Reducing demand:
(1) tax those with higher incomes (investment income at a higher rate)
(2) Raise property taxes (taxes wealth essentially)
Use the revenue from (1) & (2) to provide tax credits (based on income) for homebuyers purchasing their primary residence who meet residency requirements for CA and are US citizens

Increasing supply:
(1) Loosen zoning restrictions to allow for denser units to be built
(2) Allow for high rise construction (specifically targeting high income earners) which will in turn reduce demand for other properties

To effectively accomplish the goal, you'd need to do both of those. Can't do demand side reduction without increasing supply.

[expatCA]

Originally Posted by man4857

Well yes for the majority of foreigners but using income tax does include that group of people who are foreign nationals on a visa, wanting to purchase property.

So in the end, this proposed tax and it's implications might not even be feasible to address the fundamental issue... too much demand and little supply.

So from what I see, you can do a few things.
Reducing demand:
(1) tax those with higher incomes (investment income at a higher rate)
(2) Raise property taxes (taxes wealth essentially)
Use the revenue from (1) & (2) to provide tax credits (based on income) for homebuyers purchasing their primary residence who meet residency requirements for CA and are US citizens

Increasing supply:
(1) Loosen zoning restrictions to allow for denser units to be built
(2) Allow for high rise construction (specifically targeting high income earners) which will in turn reduce demand for other properties

To effectively accomplish the goal, you'd need to do both of those. Can't do demand side reduction without increasing supply.

Why not just make it illegal for a non legal resident of the US to buy any property? They can rent.

[man4857]

Originally Posted by expatCA

Why not just make it illegal for a non legal resident of the US to buy any property? They can rent.

I doubt that kind of law will survive the lawsuits challenging it.

[CaliRestoration]

Originally Posted by ChroNix

Yeah lets turn into Mexico.

What does that have to do with anything?

[expatCA]

Originally Posted by ChroNix

Yeah lets turn into Mexico.

That is already happening in CA.