Investors have bought so much real estate in the United States that Americans are now facing real financial problems wherever they live because of the impact of property taxes. The rate of price increases in U.S. real estate is outpacing inflation by a large margin yet while Americans can avoid spending money in some inflated areas of the economy to try to discourage price increases they can’t do that in the real estate market.
Even if a person can’t afford to buy a house, they still have to live somewhere and that means they have to pay real estate taxes through their rental fee. Municipalities that are gathering in this tax seem unconcerned about the impact of price increases in rent and mortgages. Some are now suggesting that this real estate grab by investors will drive people out of single family housing altogether after taxes make owning a home unaffordable to most people during our current economic conditions.
Property taxes were once based on market prices set by home buyers who wanted the use value of living in the home and that was acceptable before asset investors started fleeing their Wall Street insecurities and retreating into real estate. Now prices in real estate have been blown out of proportion when compared to the use value of housing.
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In the recent past, a person could build their own house as a way to save money in real estate. Recent price increases in building materials are now making that unaffordable as well. As investors panic about their doomsday fears of a market collapse, they cause financial suffering among renters and buyers because they are buying so many houses. It may therefore be time to reduce real estate taxes across America.
An alternative may be to ban asset investors from American real estate. Many asset investors come from foreign nations and have no stake in the state of American real estate except as an investment haven. Casino investment strategy on Wall Street is impacting main street directly through increases in property tax. Deregulated markets are to blame as well as easy money policies by the Federal Reserve. The Federal Reserve promises to keep interest rates artificially low for two more years and the Federal Reserve ignores the suffering that their policies are causing Americans. Ordinary Americans suffer under easy money policies and we’ve been suffering too long as it is.