You have to earn $115,000 a year to afford a typical house now in the US

It's the same across the world.

The problem is that real estate has become an asset, a form of capital.

The only way out of this mess is to shift taxation away from labor and onto capital.

Higher property taxes (1-2%), that can be subtracted from income tax for working people are the answer.

Let's say Joe the Plumber and Elon the Muskrat both have an income of $100K and pay an income tax of $25K.

Joe owns one property worth $1M that he lives in and pays 2% tax on it, $20K. Which gets subtracted from the $25K income tax, meaning he effectively pays $5K income tax + $20K property tax = $25K combined property and income tax. Pretty sweet deal.

Elon owns 20 properties valued $500M collectively, which means $10M in property taxes. He officially resides in the most expensive $100M property and gets a $50K credit for that. The $50K is larger than the $25K, so he pays zero income tax.

Total tax is $10M.

This (or something like it) is the system the whole world must move towards if we want to simultaneously (a) lower taxes on working people (b) increase taxes on property and (C) not let working people lose economic power relative to the capitalists over the longterm.

The middle class has to outsmart the owning class if we want our children to remain middle class.

I really hate all the replies attempting to poke holes with minimal effort. Thanks for this comment and your robust set of examples.
Housing shouldn't be a vehicle for interest or making a living, I'd take it more extreme than what you have if I'm being honest. You can own the buildings you use 60% of the year for work or for housing but nothing else. We don't sell stocks in bananas, we sell stocks in farms. Housing should be a consumable commodity not a line item in a corp's assets sheet.
What would stop owners from shifting the burden to the renters?
As of right now this is already how property taxes are handled by most landlords: mortgage + tax + est. cost to fix incidentals + time managing paperwork = rent (in a fair situation - though most will tack on as much extra for "profit" as they can)
So if you have a house worth 600k (12k tax), the mortgage is $3500/mo, they would just charge $4500+ a month to cover their costs.
I think the only way is to add extremely progressive property tax to multiple ownerships, and a name always has to be attached as "owner". So your first house and second might have limited property taxes, but your third would be double, fourth would be quadruple, fifth would be 8x etc.
- My example is already an extremely progressive property tax on multiple ownership, but yeah, it can be tailored as needed.
  I, personlly, would be in favor of doubling the tax if no one is living there.
  As for rent: the price of rent cannot be arbitrarily raised. If renters can buy more cheaply than renting, then landlords will have empty units.
  So in your example, renters would just buy and pay the $3500 mortgage instead of renting.
  Of course real life is more complex. Renters need access to financing, etc.
- I feel like the rent crisis is not something that can be resolved by taxes alone. What is needed is a blanket ban on private rentals.
  Got an extra house that you're not living in for some reason? If you want to rent it, then you hand over control to the ministry of housing. No more discrimination against renters, no more invasion of renters privacy, and no more extorsionate rents.
  Don't want the government renting it out to 'undesirables' or think they arent paying you enough rent? Quit hoarding and sell it.
- I'm glad we currently don't have this tax system in place otherwise rents would be absurd and growing right now!
This is a good idea which is why it will never implemented
- There's a dozen ways to fix the housing problem. Knowing how to fix it isn't the problem. Getting politicians who are paid not to fix the problem to do it anyway, is the problem.
- It will if poor people can work together against the common enemy.
It's such a simple proposal, but I think this might actually be the solution.
- It wouldn't. They already run around solutions like this by using proxies, so they are never the official owner of assets they wish to hide from the tax man.
  I am all to reform, but this can only ever successfully happen if you target these oligarchs directly and dedicate extraordinary amounts of resources on taking them down and whacking every single loop hole until you finally got them cornered.
  This is a never ending cycle.
Housing cannot be both affordable and an investment.
- It theoretically can. Yes. It realistically won't, no. Your home should be a security and not an investment. Speculation and hoarding with relation to housing should be largely outlawed. And usury being restricted to the point of being almost pointless.
  If we, as a society prioritize desirable public housing for members of our society. Who the fuck cares if a house is an investment or not. That simple security is worth far more than any so-called investment could ever be. If people wanted to work extra hard and save up for something better, that's always an option. But that shouldn't be the premise for basic housing entirely.
Whats your plan for investment groups that back corporations buying 1000 houses each month to rent?
- They will need to pay the property tax with no possibility of getting a tax discount, so they will have a competitive handicap against owner-occupiers, who will be able to outbid them in contrast to the current situation.
  Government could consider providing a discount if the houses are rented out at affordable rates.
What if the property tax is higher than the income tax? They get money back?
What about those who have to sell at a loss and are now stuck with a debt instead of profit for their retirement? Heck, some of them might be forced to go bankrupt because you can't have a mortgage for a house you don't own anymore!
- I literally covered these situations in the example, which leads me to believe you are just slinging mud and not seeking to understand.
  If you own $500M in property and have a $10M tax bill but only have $100K in income, you can figure it out, even if it means downsizing and hoarding less real estate.
  We have to stop feeling sorry for the top 0.1% of society and start taking care of the 99.9%.
- Should've thought about that before they decided to hoard real estate!

Assuming you can even win the bidding war to buy a house right now. Nothing worse than seeing a house you failed to buy have a For Lease sign on it the next week.

In my area there always seems to be a cash buyer so even if you have a strong offer and are prequalified the seller isn’t going to pick you. They need to heavily tax non-primary residences and housing owned by companies. These robobuyers have destroyed any chance people have of buying a first home.
Nothing worse than seeing a house you failed to buy have a For Lease sign on it the next week.
And it's not only companies. Lots of homeowners with low-interest mortgages from 2020-21 rent out their home instead of selling when they move, which in turn depresses inventory and puts upward pressure on prices.
That’s crazy, I’m actually getting ready to sell my house right now and it’s going to be a struggle to not lose money… and I live in the fastest growing county in Utah.

It really doesn't make sense to talk about averages for something like this in a country as large and diverse as[US is. Median home price in Hawaii is $973k. In West Virginia it's $158k. The average isn't relevant to most people, just the tiny fraction who live in a place where it's about in the middle. Also worth noting that average salaries vary pretty widely, too.

It does make sense because the average house price has gone up for everyone.
The article is about median prices.
- Yep, got that. I'm saying the standard deviation is so high that there's not a lot of use in discussing median prices across the country.

Its also very expensive to be homeless. There is no legal place to loiter or park your car. Even teh public spaces are strictly enforced with no loitering. Where I live anyways, public space is highly protected. If you dont have a private space you can do go, you are forced to constantly be nomadic going from one place to the next until you tire and cannot run away from the enforcement authorities and are jailed. When you exit jail, there is a halfway house or something you are allowed to go in, but thats only temporary and only if you have addiction problems.

- Idk, I'd imagine they'd get a cell phone for wifi reasons over loitering coverage, even though that could be an additional benefit

Housing is just a pump that transfers money from the bottom to the top. THE COST OF HOUSING USED TO BE 3 ANNUAL SALARIES. We could also turn air into a similar pump but air is more difficult to fence off...

When my wife and I started looking at buying a house, there were new houses in a brand new development going for absolutely screaming deals. Houses twice the size of similarly priced houses. They were bland, soulless husks, each one bordering on ugly. You could even just buy the land and build your own home, ordered from a catalog. No estimate on time, of course.
And nestled in to the fine print at every single one, an HOA. The worst being 400+ dollars a month.
New housing isn't being built, at least not for most Americans. We're above average earners in a low cost of living area. What we can afford is not typical, and these crappy catalog mcmansions were just at the top of our price range, before the HOA.
The only solution I see to the housing problem, is mandating that middle-low income housing be built. Right now there's no incentive to. The money is in keeping it scarce, or milking a covenant.
- Sorry, but for the non-americans, what is HOA?
- Your proposed solution is too narrow. All housing makes housing more affordable. Just let developers actually build the places people are demanding, whatever they are. No housing you build will ever be affordable unless there is enough of it.

We got our house before all of this bullshit back in 2014 before all of this bullshit happened, so we have a decent mortgage, but we really want to move to another town and we'll never be able to afford it until my rich mother dies and I inherit her money and sell her house. Which sucks, because one of the reasons to move is because she lives there.

Have you talked to her about this? She may want to give you your inheritance early if she knows it's so that you can move closer to her.
- She knows we want to move there, but we don't really talk about money in my family. I have no idea how much she's worth. But she lives in a huge house, so if she's broke, we can sell the house and get a smaller one.

I can recall a time when people said home prices will never crash, right before they crashed.

I like all the people on lemmy that just expect everyone to buy a house instead of renting.

Edit. I love how everyone hates me because I can't afford a house. Thumbs up lemmy

Buying a house is currently the backbone of middle class wealth.
If we want a society with a lot of renters and a strong middle class, then we will need to introduce strict rent controls.
Otherwise rent becomes a way for the owning class to exploit the working class.
Over the past 4 decades we have greatly loosened rent controls and promoted home ownership.
Either model can work, but most people seem to prefer owning their home rather than renting.
- You can send me money for a down payment on a house at any time.
The current level of ownership is an historical anomaly and it seems to be going down now but is it really something we should be glad is happening? I personally don't think so although I also understand that not everyone wants to own, everyone who wants to should be able to, even if it's just a small condo.
How does the leather taste
- I have no idea I can't afford leather, or a down payment on a house.

No, you just have to save money for a down payment. It's not easy but you put that down and then you're paying about $1500 to $2500 a month.

...for a $400,000 home, to pay $2,000 a month with current interest rates, your downpayment would need to be 50%>
You would need $200,000 cash in hand.
- No one puts 50% down, it isn't 1952. $10K-$25K is normal these days.
- Can you not do that? Maybe try budgeting and learning a marketable skill like programming or plumbing instead of having a degree in gender studie /s
We should all just stop eating avocado toast, obviously.
- You'll probably have enough saved around age 28-30 in most cities. It seems large but it's doable. Then you just have to get through the bidding war.
Average entry level home in my state is over 250k. 20% down payment is 50k. How many years will it take for someone actually making 115k to save that up? Stop boot licking
- You call someone that can't afford a house a bootlicker, and your also calling someone that can afford a house a bootlicker.
  Pick your lane dude
- Saving up $50K would take about 12 years, starting at age 18.
🙄 You bootstrap types coulda been made in a factory for how uniformly dull you come off
Oh, that's all? Wow! So simple! I guess to be a millionaire, you just have to save a million dollars, it's not easy, but once you have put aside a million dollars, you're a millionaire, simple as that!
Shut up.
Broski where do you live? Try saving 200k or whatever it takes to make a sensible downpayment wherever you live. Remember, while saving that money, you still pay for rent and logically, rent didn't go down either.
- I bring this up and get downvoted to hell.
- I can tell you've never bought a house if you think you need $200K to do it. It's more like $20K down and you refinance after a year to get a lower interest rate.