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#1- Money creation via fractional reserve banking - private banks lend money into existence #2- Glut of tax incentives for owning land, benefitting the landowner vs. the potential landowner (the renter). #3- Weak dollar policy 'increases' the numeric value of assets
So yes, it's a federal problem, it's just more apparent in some places rather than others.
You do have local issues as well, typically zoning ordinances that more or less prohibit building enough housing to match demand. Damn near every place in the country opposes building new housing, unless it can be forced into the high-end through minimum density laws. Of course most 'medium to low' end houses don't pay for the additional drain they have on local finances, especially schools. e.g. a median income family of 4 earns $65,000. Their house might be assessed at $250,000. They'd pay $2500 in property tax, and $3250 in state and local income taxes, while their school district spends $16,000 on their two children.
This isn't a jab at public education, but to point out that, as it stands, there are many factors AGAINST building housing for localities, as well as many other factors that make such housing that does get built very expensive.
I believe that, if all were right in the economic world, localities would be trying to attract families, that very literally people add value to communities. Unfortunately, we let that value go to waste, allowing it to be collected by private hands, rather than socializing that very socially created value. Instead we try to socialize very privately created values (incomes, wages, sales, etc.) and penalize those who build with higher tax assessments.
Federal Solution: Massive monetary reform (a pipe dream) that spends money into circulation. The Federal government would spend money on public goods, budgeting their creation of money to coincide with increased demand for money - giving such money a stable value, and accepting said money as payment for debts, namely taxes, guaranteeing demand for such money, and thus guaranteeing positive value. Significant tax reform (a difficult dream) that sharply reduces, and then eliminates those tax advantages that tend to increase the price of real estate. Namely, the mortgage interest deduction, but also the capital gains allowances. These benefit current owners at the expense of future owners, and do not actually encourage homeownership.
Local (and state) Solution: Convert existing property tax to a land value tax, where the value of the building is exempted (or partially exempted) and the revenue is made up with higher rates against 'unimproved' values. Remove barriers to development - assure greenspace with public parks and agricultural preserves, rather than minimum lot sizes.
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