- Posted at 11:29, November 25, 2013 Updated: 1:52, Nov 25
- By Russ Bleemer
A Crain's article early today says that the De Blasio administration is going to make you put your vacant lot to work. If you sit on land without developing it, your taxes are going to soar.
A developer quoted in the article says it's "Real Estate 101": drive the costs of owning the land up to the point where people will sell it or put something on it to justify the costs.
The article's explanation is simple: "all vacant lots that are zoned residential—no matter their size or development potential—are lumped into the same category as single-family homes." The 6% assessment of their market value would rise to 45% of the market value of the land over a five year-period to bring them up to commercial rates.
The article describes a three-acre, fenced-off, slab "that has sat vacant" for decades. The $8,000 in taxes the Olnick Organization sits on would rise to as much as $80,000 annually, the article states.
The article says that some properties will get blowback from owners will say they are not warehousing property, but holding it for other reasons. The focus of the De Blasio tax change, however, will be to reduce speculation in poor neighborhoods and fill them with affordable housing.
The article is in today's print edition of Crain's New York Business, and can be found online at "De Blasio tells lot owners to put up or pay up."
Of course, the idea to tax the land more fairly--i.e., they didn't earn it, so they shouldn't reap windfalls--isn't new. Way back on Friday, Salon floated an idea that it said wasn't viable, but also is inevitable: taxing land according to its real value, not what is on it. It's such a good idea that it would eliminate the need for non-holders to even bother filing. Here is a link to the commentary, titled and subtitled,
End the 1 percent’s free ride: Taxing land would solve America’s biggest problem
Want a real overhaul of the tax code? Here's an elegant way to reduce inequality and mitigate poverty--in one tax