From: stephen@sprunk.org   
      
   On 21-Mar-15 12:59, bob wrote:   
   > On 2015-03-21 17:23:19 +0000, Adam H. Kerman said:   
   >> bob  wrote:   
   >>> It would be lovely if the word were simple enough that every   
   >>> benefit every person gains could be assigned a dollar value, and   
   >>> these could be neatly attributed to specific bits of government   
   >>> spending.   
   >>   
   >> Yeah, but it's not necessary. Change in land value is so easy to   
   >> measure, so taxing land value is close enough to pay for   
   >> government, especially transportation infrastructure.   
   >   
   > Change in land value offers one method of evaluating the benefit, but   
   > it is a fairly blunt instrument.  For a start, it is hard to   
   > establish the value of land when it is not sold.  If I bought a house   
   > 20 years ago and still lived in it today, with no great desire to   
   > move, how do you actually establish the value of that house?   
      
   You're conflating the value of the house with the value of the land it   
   sits on, which is a very important distinction.   
      
   The value of the land itself is fairly simple to calculate; just look at   
   the value of nearby land (with similar zoning) that has sold recently.   
   For instance, all of the residential land in my city is currently valued   
   at $6.75/sf, and all of the commercial land is valued at $8.50/sf.  That   
   doesn't get adjusted as often as it probably should (last change was in   
   2004), but it's good enough for govt work.   
      
   The house is more interesting.  Take the lot's last selling price,   
   subtract the land value, and what remains must be the improvements'   
   value.  Depreciate that over the expected life of said improvements to   
   get the current value, and then adjust based on the recent selling   
   prices of nearby houses.   
      
   (Note that the current vogue is to tax the combined value of land and   
   improvements, with no distinction.  It would be better to tax just the   
   land value at a higher rate, but AFAIK nobody actually does that.)   
      
   >> If you own a house, if your local schools are excellent, it means   
   >> that you can sell your house for more money to a family with   
   >> school-age children. That's actually a direct benefit to you,   
   >> despite not being in school or having children attending that   
   >> school.   
   >   
   > And if I don't own a house, or own a house in an area with poor   
   > schools, I still benefit from living in an educated society.  If you   
   > tie taxation to land value, some other guy who owns the expensive   
   > house takes the tax hit, and I get the benefit.   
      
   Whether you own or rent, you're paying property taxes that support your   
   local schools, and even bad schools are better than no schools.  You may   
   choose to live somewhere with bad schools if you have no kids because   
   the taxes are lower--but you will also suffer lower appreciation and   
   higher crime (and thus insurance) rates, so it's not as much of a   
   savings as it may appear.   
      
   Those who have the most to lose if society goes to crap _should_ be   
   those who pay the most to prevent that from happening.   
      
   S   
      
   --   
   Stephen Sprunk         "God does not play dice."  --Albert Einstein   
   CCIE #3723         "God is an inveterate gambler, and He throws the   
   K5SSS        dice at every possible opportunity." --Stephen Hawking   
      
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