Have Real Estate Owners Killed Cities?

In full transparency, we own plenty of real estate. Fred and I have had this conversation again and again about how real estate owners are killing the cities. Why doesn’t our Government (Federal and State) make the tax changes that might be shocking and piss off the owners but is good for the cities in the long run? These are assets, and assets need to be used and upgraded.

Cities need to have a balanced rental market. Cities struggled before the pandemic, with high prices making it difficult to survive as a restaurant. The cost of living also increased. Regarding supply demand, that isn’t working in NYC regarding commercial or residential real estate.

During Covid, landlords, primarily residential, dropped prices and made deals. Post-Covid, countless landlords have upped the rentals, sometimes 40-75%. That is insane. But, in the end, those that depart will leave numerous apartments vacant even though there are homeless on the streets. Why? Tax deductions. The tax deductions apply to commercial real estate too. In the end, this takes advantage of our communities.

Doesn’t it make more sense for cities and communities to force real estate owners to find what the market will bear within a few months for an apartment or a storefront property? Keep these places filled, period.

The other thing that takes advantage of our cities is the 180-day rule. If you own an apartment somewhere else but don’t live there more than 180 days a year, you are not considered a town resident. The number of people doing this in NYC drives me up a wall. Can’t the State and Federal Governments develop a better solution so that the taxes are spread among each location you hang your hat and own real estate as long as you are not getting double-dipped?

If you are in NYC for 175, you get taxed for 175 days; if you live in Florida for 300 days, then you get taxed in Florida for 300 days; if you live in California or Arizona or wherever for some time in a home you own, then get taxed based on your length of stay. It is undoubtedly more fair and equitable to the state where you are eating, driving, and enjoying all the attributes of that town. Of course, it is the wealthy that take advantage of this.

Real estate owners and their lobbyists have benefitted for as long as I can remember. Including only putting down 5-10% on huge developments that take out vast loans from banks, and if you default, it isn’t such a big deal because you don’t have that much skin in the game. This is absurd too.

It is such time to be bold and make the changes in real estate taxes that will put humans back into the empty spots that are sore eyesight at the ground level and terrible for those who can’t find an affordable place to live.