Could this new tax help create affordable housing?
On Tuesday, Boston City Council held a hearing to discuss a proposal to levy up to a 6% tax on property that sells for more $2 million to fund affordable housing in Boston. City Councilors Lydia Edwards and Kim Janey co-sponsored this bill. The fee would EXEMPT owner occupants and sales under $2m, conveyances between family members, and allows for additional local exemptions. The proposal also includes a higher fee on secondary sales, or “flipped” properties. The hope is it will deter practices that “destabilize neighborhoods and artificially inflate real estate prices.”
If the City of Boston had this tax last year, $420 million could have been generated. Holy Moly! Currently, the affordable housing budget is around $50 million.
There were many people in support of this proposal at the hearing. They believe Boston is desperate for affordable housing. According to the Boston Globe, those against the proposal -including many developers and members of the real estate industry, believe eventually the tax would be passed on to the renter or small business. Well, that stinks! Others are worried a transfer tax could potentially hurt property values and make the housing market even worse.
More meetings will be held to discuss. Eventually, the City Council will vote on the bill. If approved, it will then need approval from Mayor Marty Walsh. From there, it will travel to Beacon Hill as a home rule petition to be voted on in the House and Senate and then on to Governor Charlie Baker for his signature.
What do you think?