Thanks for this summary. For my master’s thesis I was interested in researching the transportation patterns, and therefore emissions effects, after implementing a LVT. I ended up writing about something else because adequate data seemed almost impossible to find. But I imagine denser development would lead to less transportation emissions per capita.
As far as I could tell, there has been little to no research in this area. I’d be interested to hear your thoughts on the viability of researching emissions and LVT.
It’s an interesting question which to some degree can be answered via current research: “LVT -> infill development” research from Pennsylvania (see the linked PA report in the article), and “infill development -> less emissions” from general environment literature.
One project to tie that together would be interesting!
To add a question: the Transvaal (South Africa) had one of the deepest and most universal LVTs ("site tax") in the middle of the 20th century. What archival evidence exists on its implementation and do enough valuation records exist for causal analysis?
I'd really like to see detailed study of how LTV, at different levels of taxation of land rents, acts on a housing market--how does it affect the development potential of land, ability to trade land, value of entitlements (are they part of the land rent or not?), how entitlement value changes as YIMBY's reduce zoning barriers to development, etc.
Agreed. In part, some of this would be run through simulation, but other parts can be answer-able using real-world experiments.
Related to this question: one idea I have is to take land values across the city and match it with zoning. Using the land values and zoning, you can determine how much of the city is under-built even with current zoning.
A $2m plot of land in the urban core that is a single-family house, but zoned for 4-unit townhouses could develop to that full potential.
A $20,000 plot of land in the exterior zoned to 4-unit townhouse may perhaps build one or two.
The housing community has done some research on upzonings impact on land price but more definitely remains to be done.
This is a worthy exercise, but you really need to understand what makes development tick and land turn over. $2m plot of land as mansion may actually be most economically valuable allowed use. To shake land loose for development you need the land residual of new development to exceed the value of the current use value. Some uses have very high values because they are valued as consumption items or speculative bets rather than cash-flowing investments.
I regularly look at development opportunities on properties that facially are not "built out" but the new development is not feasible if the land is valued at current use. Land in our deals is typically <10%, sometimes as low as 5% of total development cost. Existing buildings set the current land price. Even fairly durpy uses can preclude economically feasible development.
Yes, agreed, there are kinks (perhaps fundamental flaws) in any "best use" modeling of a city using land+zoning, but the analysis could still inform cities
I live in Nelson, NZ. Your data lists it as having a land tax but I'm pretty sure that's wrong. Land value and improvements are itemised separately but then added together and taxed as one.
Thanks for this summary. For my master’s thesis I was interested in researching the transportation patterns, and therefore emissions effects, after implementing a LVT. I ended up writing about something else because adequate data seemed almost impossible to find. But I imagine denser development would lead to less transportation emissions per capita.
As far as I could tell, there has been little to no research in this area. I’d be interested to hear your thoughts on the viability of researching emissions and LVT.
It’s an interesting question which to some degree can be answered via current research: “LVT -> infill development” research from Pennsylvania (see the linked PA report in the article), and “infill development -> less emissions” from general environment literature.
One project to tie that together would be interesting!
To add a question: the Transvaal (South Africa) had one of the deepest and most universal LVTs ("site tax") in the middle of the 20th century. What archival evidence exists on its implementation and do enough valuation records exist for causal analysis?
I know nothing about it, so I too would be interested to know!
I'd really like to see detailed study of how LTV, at different levels of taxation of land rents, acts on a housing market--how does it affect the development potential of land, ability to trade land, value of entitlements (are they part of the land rent or not?), how entitlement value changes as YIMBY's reduce zoning barriers to development, etc.
Agreed. In part, some of this would be run through simulation, but other parts can be answer-able using real-world experiments.
Related to this question: one idea I have is to take land values across the city and match it with zoning. Using the land values and zoning, you can determine how much of the city is under-built even with current zoning.
A $2m plot of land in the urban core that is a single-family house, but zoned for 4-unit townhouses could develop to that full potential.
A $20,000 plot of land in the exterior zoned to 4-unit townhouse may perhaps build one or two.
The housing community has done some research on upzonings impact on land price but more definitely remains to be done.
This is a worthy exercise, but you really need to understand what makes development tick and land turn over. $2m plot of land as mansion may actually be most economically valuable allowed use. To shake land loose for development you need the land residual of new development to exceed the value of the current use value. Some uses have very high values because they are valued as consumption items or speculative bets rather than cash-flowing investments.
I regularly look at development opportunities on properties that facially are not "built out" but the new development is not feasible if the land is valued at current use. Land in our deals is typically <10%, sometimes as low as 5% of total development cost. Existing buildings set the current land price. Even fairly durpy uses can preclude economically feasible development.
Yes, agreed, there are kinks (perhaps fundamental flaws) in any "best use" modeling of a city using land+zoning, but the analysis could still inform cities
I’d be really interested in a threshold of “at least pay for the infrastructure that supports the lot +10%”
Free riding land on (expensive to maintain) public infrastructure.
I live in Nelson, NZ. Your data lists it as having a land tax but I'm pretty sure that's wrong. Land value and improvements are itemised separately but then added together and taxed as one.
Nelson City Council's website indicates that the general rate and the flood protection rate are charged against Land Value: https://www.nelson.govt.nz/3rates/how-rates-are-calculated-and-spent
Seems to be confirmed if you look up a specific property's calculated rates, eg 42 Fergusson Street had their rates charged against $385k of LV last year, not $710k of CV: https://www.nelson.govt.nz/3rates/rates-search?searchBy=streetAddress&streetNumber=42&streetName=Fergusson%20Street%2C%20Nelson&property=1966019800