We have a big housing problem in California and I’d like to explore running a ballot initiative in 2018 that will help alleviate this crisis. Over the next four weeks I’m going to propose policies that I think could help.
Please sign this petition if you think the below policy makes sense– if we get a lot of support, we will pursue it.
There is a housing crisis in California. The median home cost is now over $500,000, which is twice the national cost. Over the last five years, housing prices in Los Angeles, San Francisco, San Jose and San Diego have increased as much as 75 percent. I’m tired of seeing my friends leave the state because they can’t afford a place to live.
In recent years in the US, we’ve seen huge uptick in foreign buyers buying property they aren’t even living in, often as a way to buy a tax-favored asset in US dollars. Last year, foreign buyers bought $150 billion of US property.
A lot of these buyers are using these houses as investments they plan to live in a small part of the time or not at all, and I think that’s bad for Americans. I believe that housing should be used primarily as a way for people to live, not a way to make money.
California has been hit extremely hard, and this is pushing up prices dramatically for Californians looking for a place to live. I walk by many new condo buildings in San Francisco that are dark at night. I think we should introduce a new tax on foreign buyers (specifically, anyone who is not a citizen, green card, or long-term visa holder) of real estate in California–I think we want people buying houses that are able to and plan to live in them for the long-term. A tax here will both reduce demand and generate new revenue.
Vancouver and Toronto have implemented policies like this with impressive results. According to the Real Estate Board of Greater Vancouver average home prices fell by 16% after the tax was implemented. Prices in Toronto have already fallen 12% from their peak since a foreign buyers tax was implemented there.
Not only could a tax like this provide relief for California’s overheated housing market, but it could also be a major source of tax revenue for the state. According to the National Association of Realtors foreign buyers bought over $18 Billion worth of real estate in California in 2016. A 35% tax could generate billions for the state. We could use that revenue to build thousands more affordable housing units.
If you agree this could be a good policy, please sign the petition below and share it with people who might think so as well–we will try to leverage support to make this happen. If you have comments, please share them here. We would love to hear what people in other states think too, as this could make sense beyond just California.