Posted March 29, 20232 yr Proposed tax on high-volume landlords aims to help Ohio homebuyers, but landlords have concerns A proposed state law meant to keep high-volume investors from buying up single-family housing in Ohio has some landlords worried. Senate Bill 76 would impose a new tax on landlords with more than 50 houses in a single county. A taxable house is any single-family, two-family, or three-family dwelling. The “housing market impact tax” would total $1,500 per month, or $18,000 a year, for each taxable house owned by the landlord. It would apply to any landlord owning 50 or more houses in Ohio, aside from 501(c)(3) nonprofit organizations, port authorities and county land banks. Homes attached to a business, on 10 or more acres of land, trailers, recreational vehicles and boats are also excluded. Advocates argue the proposal would improve rental conditions and cut housing costs. But some landlords say the legislation could penalize entrepreneurs and in fact pass costs on to tenants. Legislative hearing The legislation was introduced Feb. 28 and had its second hearing in the Senate Ways and Means Committee on March 22. Sen. Louis Blessing, a Republican who represents parts of Cincinnati, and Sen. Nickie Antonio, a Democrat who represents parts of Cleveland, are co-sponsoring the bill. In the hearing last week, Blessing said the proposal is meant to tamp down on investors getting near monopoly ownership of homes in a market. He said he didn't want people to lose homeownership opportunities, especially first-time buyers, as investors buy up large swaths of homes in single-family neighborhoods and turn them into rentals. Sen. Hearcel Craig, who represents parts of Columbus, has also signed onto the bill. He said his office regularly hears from families struggling to find homes to purchase who end up renting instead. "In our district, far too many families are paying more than 50% of their income on rent," Craig said in an emailed statement. "Housing costs in Columbus have risen exponentially, in large part due to these corporations buying up large amounts of starter homes and driving up the price." Craig said the bill would disincentivize high-volume landlords from buying up housing stock and help make it easier to identify hedge funds or other investors buying the homes. "Employers, businesses looking for workers, and families cannot keep up with the rising cost of living in Columbus. The short supply of starter homes is a pressing workforce issue in Central Ohio," Craig said. Full article below: https://www.bizjournals.com/columbus/news/2023/03/29/ohio-state-rental-tax-homebuyers-landlords.html "You don't just walk into a bar and mix it up by calling a girl fat" - buildingcincinnati speaking about new forumers
March 30, 20232 yr 5 hours ago, ColDayMan said: Proposed tax on high-volume landlords aims to help Ohio homebuyers, but landlords have concerns A proposed state law meant to keep high-volume investors from buying up single-family housing in Ohio has some landlords worried. Senate Bill 76 would impose a new tax on landlords with more than 50 houses in a single county. A taxable house is any single-family, two-family, or three-family dwelling. The “housing market impact tax” would total $1,500 per month, or $18,000 a year, for each taxable house owned by the landlord. It would apply to any landlord owning 50 or more houses in Ohio, aside from 501(c)(3) nonprofit organizations, port authorities and county land banks. Homes attached to a business, on 10 or more acres of land, trailers, recreational vehicles and boats are also excluded. Advocates argue the proposal would improve rental conditions and cut housing costs. But some landlords say the legislation could penalize entrepreneurs and in fact pass costs on to tenants. Legislative hearing The legislation was introduced Feb. 28 and had its second hearing in the Senate Ways and Means Committee on March 22. Sen. Louis Blessing, a Republican who represents parts of Cincinnati, and Sen. Nickie Antonio, a Democrat who represents parts of Cleveland, are co-sponsoring the bill. In the hearing last week, Blessing said the proposal is meant to tamp down on investors getting near monopoly ownership of homes in a market. He said he didn't want people to lose homeownership opportunities, especially first-time buyers, as investors buy up large swaths of homes in single-family neighborhoods and turn them into rentals. Sen. Hearcel Craig, who represents parts of Columbus, has also signed onto the bill. He said his office regularly hears from families struggling to find homes to purchase who end up renting instead. "In our district, far too many families are paying more than 50% of their income on rent," Craig said in an emailed statement. "Housing costs in Columbus have risen exponentially, in large part due to these corporations buying up large amounts of starter homes and driving up the price." Craig said the bill would disincentivize high-volume landlords from buying up housing stock and help make it easier to identify hedge funds or other investors buying the homes. "Employers, businesses looking for workers, and families cannot keep up with the rising cost of living in Columbus. The short supply of starter homes is a pressing workforce issue in Central Ohio," Craig said. Full article below: https://www.bizjournals.com/columbus/news/2023/03/29/ohio-state-rental-tax-homebuyers-landlords.html $1500 per month per house? There HAS to be a better way to improve landlord behavior. For example, local property managers being held liable for issues. It seems like the purpose of this bill is to completely eliminate large scale landlords. I don’t see that, in itself, as a worthy goal. When is the last time I-71 turned a profit?
March 30, 20232 yr At the very least, this would dramatically change the housing environment around Ohio State, where there are vast numbers of rental properties and I'm sure there are a lot of them that are owned by large (50+ unit owner) landlords. And I agree, I don't think that's necessarily a good thing, because the demand for rental housing by OSU is not, and never will be, normal. On the other hand, I do see one interesting implication there: the definition of a "taxable house" as any dwelling of 1-3 units. That leaves an interesting gap at four, generally the highest unit count for which traditional mortgage financing is available (including FHA loans, loans with Freddie Mac backing, etc.). I've spoken with others in the urban planning scene in Akron who have ventured that the market for "quads" is one where there among the larger current mismatches between supply and demand. I still don't think I could get behind this bill, but I do think it's an interesting thought experiment if large corporate landlords are effectively taxed out of the single, duplex, and triplex markets, do we start seeing more interest in building quads again? Something of an ancillary point (ancillary enough that it's not going to get me onside supporting this bill), but just something I noticed reading between the lines of the definitions there and considering possible implications.
March 30, 20232 yr 4 minutes ago, Lazarus said: What is stopping an "investor" who owns 500 houses from setting up 10 companies? Affiliate/common-ownership rules are a fairly common phenomenon at this point. Those investors probably already have many companies. Real estate investors/developers/owners do that all the time to separate the financing by project (among other reasons), though of course some banks will seek cross-collateralization.
March 30, 20232 yr 18 minutes ago, Gramarye said: I still don't think I could get behind this bill, but I do think it's an interesting thought experiment if large corporate landlords are effectively taxed out of the single, duplex, and triplex markets, do we start seeing more interest in building quads again? Interesting. Potentially we see increased investment in density because there is nowhere else for corporate/investment money to go in the housing market. If this plan works, it seems like an improvement solving a very-real problem. It's difficult for homebuyers who need reasonable-and-prudent contingencies (inspections, financing, sale of previous property) to compete against all-cash, contingencies waived, over asking offers funded by corporate money.
March 31, 20232 yr 12 hours ago, Gramarye said: On the other hand, I do see one interesting implication there: the definition of a "taxable house" as any dwelling of 1-3 units. That leaves an interesting gap at four, generally the highest unit count for which traditional mortgage financing is available (including FHA loans, loans with Freddie Mac backing, etc.). I've spoken with others in the urban planning scene in Akron who have ventured that the market for "quads" is one where there among the larger current mismatches between supply and demand. 4+ units are considered a multifamily development by code. That's when a whole lot of legal requirements, zoning classification, and different legislation (particularly the federal fair housing act) all kick in 1, 2, and 3-family dwellings all fall under the residential code and are much less regulated
