Your Zoning Laws Stop At This Border

Charlie Gardner has written a fascinating post about Brownsville and Matamoros, two cities separated by the Texas/Mexico border. The essay is mostly a contrast between their different urban-planning styles: Lot sizes are smaller in Matamoros, Mexico, for example, and "Single-use zoning seems to be unknown or unenforced, as numerous small commercial establishments can be seen cropping up, mid block, along these [residential] streets." Among the results:

Brownsville in on the right.Google Mapsalthough Brownsville is very cheap by American standards, with a median home price of $130,000 for what is typically a three bedroom home, a relatively large Matamoros starter home (915 square feet over two stories on an 1130 square foot lot) can be had for only $34,000. The tiniest of the starter homes, no bigger than a studio or micro-apartment, are as little as $10-15,000. This suggests that a new two-bedroom home in Matamoros can be purchased for approximately what the down payment would be for a typical three bedroom home in Brownsville, and helps explain Mexico's very high homeownership rate. Finally, it has implications for mixing of uses, since the dense packing of houses allows for businesses to thrive on foot traffic, reducing the political pressure for parking minimums that would, even in the absence of zoning, effectively ban businesses on tiny lots.

The towns are similar in many other ways: geography, demography, even wealth. (Brownsville is poor by U.S. standards, and Matamoros is relatively rich for Mexico: According to Gardner, the former has a GDP of $14,000 while the latter is just below that at $10,000.) Of course there are important differences as well, but it's still sort of a natural experiment in diverging urban ideas. Read the whole thing.

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  • Fist of Etiquette||

    Mr. Obama, tear down this wall.

  • UnCivilServant||

    Zoning laws and eminent domain are two of my pet peeves. If it's my plot of dirt, no one should be able to tell me what I can or cannot do with it, nor should they be able to steal it from me with bullshit laws.

  • sarcasmic||

    Property taxes are a euphemism for rent.

  • Dances-with-Trolls||

    Immediately thought the same thing. No citizen truly owns land in the great USA

  • Invisible Finger||

  • Ivan Pike||

    If it's my plot of dirt, no one should be able to tell me what I can or cannot do with it, nor should they be able to steal it from me

    Chief Joseph agrees with you.

  • So very tired||

    How'd he get his again?

  • Ivan Pike||

    How'd he get his again?

    His ancestors moved into vacant land.

    More than 75 Nez Perce village sites have been identified along the Snake and its tributaries. Some have been carbon-dated to 11,000 years, or about 500 generations; there are also indications of far older settlements.
  • John||

    For sure. But they should be able to sue you for damages if any of your dirt in the form of dirt, fumes or noise blows over onto their pile of dirt.

    It is amazing. We inherited the greatest piece of collective wisdom in human history in the common law. Every single rule of the common law passes even the strictest economic scrutiny. Yet, we have spent the last 100 years moving away from and ignoring it at every possible opportunity. Unsurprisingly, this hasn't worked out too well.

  • R C Dean||

    I hear ya, John. The common law is that rarest of things: bottom-up, rather than top-down, rulemaking, honed through thousands of real-world experiences.

    Its the arrogance of the anointed that leads them to discard this kind of hard-won learning. They are just so sure they are smarter than their ancestors. Not better-informed or better-educated, but just the intellectual and moral superior of everyone who came before. And, needless to say, nearly everyone who is here now.

  • robc||

    and we learned the other day that Tulpa is opposed to common law. Which is another point in its favor.

  • Death Rock and Skull||

    Link.

  • Death Rock and Skull||

    "they should be able to sue you for damages if any of your dirt in the form of dirt, fumes or noise blows over onto their pile of dirt"

    No natural risk, whatsoever? No one can have a barbecue?

  • UnCivilServant||

    The aroma of food is assaulting me!

  • John||

    Sure you can barbeque. I can't imagine how that damages the other guy's property. But what if you set up a pit so big that he can't go out in his back yard for all of the smoke if the wind is blowing right?

  • So very tired||

    He can move.

  • robc||

    Zoning laws and eminent domain are two of my pet peeves.

    Ditto.

    Ive argued on here that ED is self-defeating, as the FMV that is required for ED is, according to standard accepted economic theory, whatever a willing buyer and willing seller agree to. So, the FMV cant be any lower than what the owner is willing to accept.

    And zoning laws are clear takings, which falls back to the same problem. The value that has to be paid for the taking is the FMV.

  • Hawk Spitui||

    Well, not really. You own certain *rights* to the plot of dirt. If you look at your deed, you'll probably find out that others may own other rights to that same plot of dirt, such as water rights, mineral rights, etc.

  • Death Rock and Skull||

    In theory, those were all voluntarily negotiated, unlike zoning, eminent domain, and property taxes.

  • Jordan||

    No zoning laws?! Do you want to live in Somalia Houston?!

  • Brett L||

    It all went to shit with the Adult Business zoning law.

  • John||

    I think it is a little more than zoning. I am sure zoning doesn't help. But I suspect things like building codes, professional licenses, environmental laws (at all levels including governing the manufacture of products), and the no doubt corrupt building permitting schemes that go on in Brownsville like every other American city has a lot more to do with it than zoning laws.

  • sarcasmic||

    I'm sure building codes explain most of the price difference in home prices.

  • John||

    Codes and licenses. You can't do much of anything without hiring a "licensed" tradesman to do it. And that costs money. In Mexico, you can hire anyone you think can do the job.

  • Kevin47||

    Of course, the "licensed" tradesmen will outsource the work to the same people who built the houses on the Mexico side.

  • ||

    Agreed.

    Plus, I resent the implication that lot size doesn't affect quality of life.

    There is a reason why most Americans want a single-family home on a quarter-acre lot. Human beings are happiest when they have a degree of privacy and personal space. A private back yard allows a person some space to pursue personal activities ALONE. Gardening, building things, having private parties with personal friends.

    Progressives would love to force us all into tiny condos and townhomes so that all of our activity is forced out into public where we can all watch eachother. People with no personal space are forced to go to "community" facilities for their entertainment. They are forced to "share" public spaces. They have nothing of their own that they are able to keep separate and private. It makes them better human cogs.

  • John||

    The Reason hatred of lot size restrictions is a good example of Libertarians letting their ideology and naivety play into Progressives' hands. Progs will happily accept Libertarian support to get rid of lot size restrictions and then use their influence over building codes and government pressure on builders to make it impossible for anyone to have a large lot even if they can afford it.

    Zoning is in some ways where I part ways with Libertarians. I think arbitrarily changing zoning laws is wrong and amounts to a taking of existing property owners. But if a group of land owners want to form a "town" and voluntarily enter into a covenant that prevents them from selling their own land in smaller parcels, that is fine by me. The people owning have entered into the contract and anyone buying the property in the future knows that they are not buying the right to sell it off in smaller sections. So they can price their purchase accordingly.

    Libertarians never seem to get that and think someone should be able to buy into a such a situation and demand the right to use the land anyway they see fit.

  • sarcasmic||

    What's it called when you put forth an argument that no one has made, attribute it to your opponent, and then demolish it?

  • John||

    I have this argument about a million times on here. There are long threads, though not for a while, on here about the nature of property rights. And not every seems to comprehend that "property" is nothing but a bundle of legally enforceable rights you buy from the former owner.

    If you agree with me, great. If you don't, tell me why. Otherwise, please don't waste your time or space on the thread screaming buzzwords.

  • robc||

    And not every seems to comprehend that "property" is nothing but a bundle of legally enforceable rights you buy from the former owner.

    This goes to my point about deed restrictions. When someone does sell the entire bundle, they still own a piece of the property, and thus should be paying property tax.

  • John||

    I would argue that when you sign a covenant, you have taken your asset and effectively burned it. It no longer exists and you therefore should not be taxed for it.

  • robc||

    That implies that land can never return to an unencumbered state. And Im pretty sure that goes against common law contract interpretations. Isnt there some sort of restriction against contracts in perpetuity?

    This is obviously not how property law has worked, but how it would work in libertopia (I "support" an SLT in libertopia, but I admit Im an outlier on that -- I would be fine without one, but its the only tax I dont oppose on a moral basis).

  • robc||

    "does NOT sell"

  • Death Rock and Skull||

    No, fuck you. If I want to buy a small lot, then fuck you. That is all. Fucker.

  • Jesse Walker||

    if a group of land owners want to form a "town" and voluntarily enter into a covenant that prevents them from selling their own land in smaller parcels, that is fine by me

    This is done privately all the time, and libertarians do not object. (Well, not in principle. We might personally prefer to avoid the place.)

  • John||

    But isn't that zoning Jesse? What if the town passes a zoning law and pays anyone who can prove it for the loss of value of their property?

    Indeed, a lot of zoning laws make the property it covers more valuable than it otherwise would have been. I am fine with that and don't view it as a taking. I suspect not everyone would be.

  • robc||

    John, you are making the same error Dan T. made back in the days of yore when he claimed that an HoA was a government.

  • John||

    No. What I am saying is that a government can do the same things that an HOA does, except that since it compels people, it should have to pay for any loss in property value that results from its actions.

  • prolefeed||

    Since the government gets to decide what, if any, are damages or losses from their decisions, and can claim that a zoning restriction isn't really a taking at all, that doesn't fly.

    A monopoly government that can change the rules at any time, and do it to people who never consented to be ruled, is fundamentally different than a HOA where you explicitly agree upfront to the rules prior to signing an actual contract.

  • R C Dean||

    But isn't that zoning Jesse?

    Not really. What you describe is an HOA, where you buy in with full knowledge of all the restrictions placed on your property, with little to no prospect of those restrictions changing.

    Zoning is where a small group of people can change the restrictions on your property more or less at will, based on the "consent" via voting of people who may or may not own any of the property affected by the zoning.

  • sarcasmic||

    There is a difference between voluntarily entering into a known contract, and having elected officials impose rules upon you.

    Not the same thing.

  • Kevin47||

    "But isn't that zoning Jesse?"

    Nobody has a problem with zoning qua zoning. It's zoning enforcement under threat of prison.

  • robc||

    I have a problem with zoning qua zoning.

  • Death Rock and Skull||

    No, that is not zoning. Zoning is a minority legislating on shit that everyone else didn't hear about or didn't have time and resources to fight.

  • ||

    Well, Libertarians definitely respect the right of HOAs to set use restrictions, since that is a voluntary agreement among landowners. Some people like HOAs, some don't. If you don't like HOAs, don't buy a house in an area governed by a HOA.

    Zoning is generally done by city councils though and it's almost always a bunch of prog urban planners playing real-life sim city with other people's lives and property.

  • John||

    Not always. Sometimes it is home owners looking to protect the value of their property by preventing people from building too much around them.

    I believe that zoning can amount to a taking and that local governments should have to pay for any reduction in property values that result from zoning. But if they did that, I don't have a problem with zoning.

  • robc||

    I believe that zoning can amount to a taking and that local governments should have to pay for any reduction in property values that result from zoning.

    See above, re my argument on "value". I agree with that sentence you wrote, but it still has that fundamental flaw.

  • Death Rock and Skull||

    Land at a particular value is not an entitlement. I shit on your "property values".

  • robc||

    I agree, HOWEVER, I think that in cases of a deed restriction, the previous owner still owns a piece of the property (IE, the restriction) and should have to pay the property tax on that piece.

    If a deed restriction lowers the value of my lot from 20k to 15k, then the restictor still owns 5k of my lot and should pay the appropriate tax.

  • Ivan Pike||

    I agree, HOWEVER, I think that in cases of a deed restriction, the previous owner still owns a piece of the property (IE, the restriction) and should have to pay the property tax on that piece.

    Wouldn't you take that restriction into account when you purchase the property? If it did lower the value of your property by $5k, then why pay the extra $5k for the property?

  • robc||

    I only payed 15k and am only paying tax on 15k.

    But the lot, in an unencumbered form, is "worth" 20k. Thus the restictor* still owns 5k of the property so should still be paying tax on 5k. As John pointed out above, what property is is a bundle of rights. He kept part of the bundle, so still owns part of the property.

    *apparently this word cant be spelled properly.

  • Ivan Pike||

    I only payed 15k and am only paying tax on 15k.

    But the lot, in an unencumbered form, is "worth" 20k. Thus the restictor* still owns 5k of the property so should still be paying tax on 5k

    I guess my question then would be how you determined the value at $20k? Isn't value determined by what a willing seller/buyer agree to? So if you paid $15k, then the value is $15k.

    Just out of curiosity, are you a Georgist?

  • robc||

    I have Georgist tendencies on property, yes.

    I wouldnt describe myself as Georgist, because he has a lot of crap that goes beyond what I think.

    I just havent seen any natural law property rights argument that wasnt completely shit. And Im otherwise a huge proponent of natural law.

  • Ivan Pike||

    I have Georgist tendencies on property, yes

    I guess I should have asked if you favored a single land tax. Is that were you get the $20k "value" from a $15k transaction?

    I learn a lot from Reason commenters, even though I am not a libertarian.

  • robc||

    I guess I should have asked if you favored a single land tax.

    See my post up above. The SLT is literally the ONLY tax that I dont object to on moral grounds.

  • robc||

    I guess my question then would be how you determined the value at $20k?

    The same way property is valued for tax purposes now. They make shit up.

    Isn't value determined by what a willing seller/buyer agree to?

    Absolutely. I think Ive argued the exact same thing twice already in this thread.

    So if you paid $15k, then the value is $15k.

    In its encumbered state, on the day of the sale, yes. But what is its "value" tomorrow. The taxman cares about that, although it stays at the purchase price for a few years.

  • Brett L||

    I hate my HOA, even though I have carefully cultivated friendships with the board, so that I can do shit like build a fence or cut a tree without having a fight. Will not live again.

  • FreeToFear||

    But if a group of land owners want to form a "town" and voluntarily enter into a covenant that prevents them from selling their own land in smaller parcels, that is fine by me. The people owning have entered into the contract and anyone buying the property in the future knows that they are not buying the right to sell it off in smaller sections.

    And of course by "voluntarily" you meen that 60% of the landowners approved incorporation by referenda - the rights of the other 40% are forfeit because FYTW

  • robc||

    My neighborhood is filled with tiny lots (no HOA either). MANY of the homeowners own multiple lots. They built on one and kept the others empty to form the large lot they wanted.

    As they are dying off (its a weird mix of houses built today and 80 years ago and every age in between) and sold, new houses are getting built on those buffer lots.

    Im kinda glad Im going to be getting out of here.

  • Tony||

    I chose to live in a high-rise because I didn't want to deal with a yard, among other things. Didn't realize I was choosing an objectively worse lifestyle as a part of a liberal plot to churn out pod people.

    Dense living is better for the environment and teaches people to tolerate difference. It has objectively way more going for it than suburbia, so you're entitled to your preference but that's kind of a strange high horse to be on.

  • prolefeed||

    Dense living is better for the environment and teaches people to tolerate difference. It has objectively way more going for it than suburbia

    Objective means the opposite of "subjective", and what a person likes is about as subjective as it gets.

    I live in a three story apartment complex with a beautiful common area that I use a lot, not because that is my dream arrangement, but because it is affordable for the time being.

  • WTF||

    All of 'Tony's' preferences are 'objectively better' and therefore should be forced on others at the barrel of a gun.

    This is what 'Tony' really believes.

  • UnCivilServant||

    I've tried "dense living" as you call it. I've found that proximity breeds contempt. I can't stand my neighbors, and their presense just a wall away has increased my anti-social tendencies. It is not objectively better in any way, because it is a nice dense target for say, a terrorist attack. It is subjectively better because you feel it is somehow efficient. It creates urban heat islands which dramatically alter weather patterns and tend to have drainage systems where a good rainfall mixes the sewers. As more of the "dense" housing resides on waterways, this sewage runoff does not just soak into and fertilize the local fields (as with a good septic system) but instead kills the fish downstream. You like the conditions, and try to justify them as somehow "better", when there are always tradeoffs.

  • Rhywun||

    their presense just a wall away has increased my anti-social tendencies

    I have always found it easier to ignore my neighbors the closer they are. At suburban densities they're always coming over to borrow a cup of sugar or some shit. At urban densities, people tend to ignore each other as a coping mechanism.

  • ||

    Remember the old adage 'good fences make good neighbors'?
    Isn't it actually generally acnowledged that people are more hospitable in rural areas than in big cities?

    It's much easier to be on friendly terms with the people next door when you get to control what they know about your private life. You can show what you want to show, and let them in only as much as you feel comfortable with.

    Maybe, in a dense urban environment, the lack of privacy makes people adopt a policy of polite ignorance. Because you can overhear your neighbors having sex, you politely ignore them in public to make them feel that they AREN'T being intruded on.

  • Rhywun||

    Isn't it actually generally acnowledged that people are more hospitable in rural areas than in big cities?

    I think that is the stereotype but I don't buy it for a minute. Further, one person's "hospitable" is another person's "interference".

    As for the city, I don't hear anything coming from my neighbor's apartment. Thick walls, I guess. But yes, polite ignorance is a pretty good description of the phenomenon - which IMHO is incorrectly interpreted as "inhospitability".

  • waffles||

    Tony, sometimes you are the definition of a pod-person. I moved cross-country for an 18 month work assignment. I have colleagues who chose live in luxury condos and high-rises. I chose to rent a house in an ever "up and coming" part of town. I know my neighbors and have always have someone to chat with about the neighborhood. My colleagues live in anonymity from cubicle to condo and back again. Pod people.

  • sarcasmic||

    Yesterday I heard gun fire, so naturally I stomped through the snow to say "Hi." Found my neighbor, a few friends, some beer, a couple shotguns, a few rifles in assorted calibers, and a handgun. I pulled out my handgun and they got all excited because some of them had never shot a revolver before. So I pulled out a box of rounds and let them have at it.

    I couldn't stand living in a high-rise.

  • Rhywun||

    When I run out of vodka, it's a two-minute walk to the nearest liquor store.

    Tradeoffs :)

  • Death Rock and Skull||

    High rise people have discovered plenty of creative ways to enjoy the hobby of firearms. There was a high rise with a luxurious view of Comiskey Park that was famous for this.

  • ||

    Dense living is better for the environment and teaches people to tolerate difference.

    Yes, Tony, let's force people to live densely together, because it will "teach them" things we think they should learn.

    Even if it make people unhappy, bewcause human nature inclines people to prefer lower density living.
    We've got to cram them in together to force people to change human nature.
    New Soviet Men!

  • Marc F Cheney||

    Dense living... teaches people to tolerate difference.

    Why would anyone who's been to, say, Boston ever believe that? It's pure fantasy.

  • ||

    There's a lot of recent social science that supports that. Living in ethnically diverse environments seems to make people more racist, not less. Unless you put an emphasis on forming an overarching group identity (i.e. cultural assimilation), people will fragment into ethnically oriented sub-groups.

    Although it's not really the density per se, I wouldn't be surprised if population density magnified the effect.

  • ||

    Dense living is better for the environment and teaches people to tolerate difference.

    That must be why the suburbs have such an abysmally low crime rate and live so long destroying the environment with their longer life spans.

  • Invisible Finger||

    There is a reason why most Americans want a single-family home on a quarter-acre lot.

    This is completely untrue.

    The quarter-acre lot didn't become popular until people started owning automobiles. And in many cases people would be happy to have a garage UNDER the living space if the zoning allowed it. But God forbid a 1,400 sq ft. house be 3 stories.

    And I haven't even mentioned municipal sewers versus personal septic systems.

    I seriously doubt anymore than 15% of Americans want a lot size that happens to match each other.

  • ||

    The adoption of the automobile was voluntary, was it not?

    People bought automobiles because they wanted them. And then they moved out to quarter acre lots in the suburbs because they wanted them. The automobile enabled them to have more space. If they didn't want more space, they wouldn't move out of the city to the suburbs.

  • Invisible Finger||

    In the suburb I grew up in, the lot sizes were the same as the lot sizes in the city. People moved to the suburbs to escape the outrageous taxes.

    If anything, most suburbs have way more residential zoning restrictions than cities do (usually idiotic "green space" requirements as if the freaking towns couldn't have reserved more land for parks.)

  • ||

    Residential zoning restrictions are a separate issue. My point is that most humans naturally prefer less dense living conditions than what is offered by a typical condo or townhouse or apartment complex.

    Go to any rural villiage in the world. They don't live in one giant hive-like tenement. They all have separate houses with their own green space around them.
    Normal humans want a detached house with a little bit of land around it.

  • JD the elder||

    Oh, come off it. Normal humans want this, normal humans want that. Pretty strange that millions of people voluntarily choose to live in cities, then. Are they all just not normal or something? What individuals want varies a great deal, which is a good thing since it lets us not all compete for the same thing.

  • ||

    People make tradeoffs. Who wouldn't want a single family home in downtown Manhatten?

    They don't do it because they can't afford it. Not because they wouldn't prefer to have the space.

  • Rhywun||

    Who wouldn't want a single family home in downtown Manhatten?

    I wouldn't - because I am a single person and I don't want to take care of a whole house or a yard.

  • Rhywun||

    Go to any rural villiage in the world

    This is not even close to accurate. Take a Google view of rural Europe sometime - it's all dense villages surrounded by farmland or forest. The "detached house with a little bit of land around it" has been a luxury in all times and all places until very recently.

  • ||

    The "detached house with a little bit of land around it" has been a luxury

    Why would it be considered a "luxury" if people don't naturally desire it?

    If human beings evolved to live in hive-like proximity, wouldn't our instincts make us WANT to live in crowded tenements?

  • ||

    If our natural instincts made us want to live in densely populated conditions, we would be paying extra to get a great room in a group house, not to get a large home on an acre lot.

  • Rhywun||

    we would be paying extra to get a great room in a group house

    Like a condo at the Park Plaza?

    Not everyone is "evolved" to want to live your way.

  • Death Rock and Skull||

    Although, the infrastructure for automobiles was subsidized, when it shouldn't have been. People would have still owned cars, but they might have packed a little closer together on account of slower travel times due to shitty unimproved roads, or just bought vehicles with more rugged suspension and tires. Anyway, it would have been slightly more free-markety.

  • Death Rock and Skull||

    "There is a reason why most Americans want a single-family home on a quarter-acre lot."

    I like shotgun houses. I would probably have a bitch of a time finding a place that allowed me to build one on a tiny lot.

    "Gardening, building things, having private parties with personal friends."

    Don't forget shooting stuff, with an adequate backstop of course.

  • Death Rock and Skull||

    Technically, I think environmental laws, building codes, and permits are under the broad category of zoning. "Public possession" of a drink is referred to as a zoning violation, and gets run through the civil system.

  • ||

    a relatively large Matamoros starter home (915 square feet over two stories on an 1130 square foot lot)

    Whereas in N. Virginia, that starter home would sell for $250,000.
    And you would have to pay $200 a month in condo fees.

    I don't think lot size is what is making the difference. There are lots of high density housing areas in the US that are more expensive on a per-unit basis than Brownsville. Indeed, prgressives would love ot ram us all into tiny lots in condos and townhomes.

    The difference undoubtably has to do with the complexity of building regulations in the US vs. Mexico. Not to mention the cost of materials, which is probably also driven up by environmental regulations in the US.

  • The Late P Brooks||

    ABBATOIRS! IRON SMELTERS! GRAVEL PITS! TIRE DUMPS! HAIR BRAIDERS!

    Why do you want America to be a third world hellhole, reason?

  • UnCivilServant||

    Most urban lots don't have the right kind of substrate to produce gravel.

  • Gene||

    ABBATOIRS!?

    There are only four members, even if you throw in the half dozen or so tribute acts, it hardly makes an industry.

  • Gene||

    ^for LPB of course^

  • Tonio||

    Also, I think Realtors might be part of the problem here in the US. I don't think they would find the commissions on a $10,000 real estate transaction very appealing.

    Does anyone know how real estate transactions are handled in Mexico? Lawyers? Realtors(tm), unlicensed real estate agents?

  • John||

    ^^THIS^^ Do you think maybe the Realtors' lobby, who have a tone of money and a huge amount of power in Washington, have something to do with Congress never even considering getting rid of the home mortgage deduction or telling the fed to stop printing money?

    It is not just zoning and building codes and such. It is pretty much our entire tax and financial system that is set up to artificially prop up housing prices.

  • ||

    Point to note:

    You only get the home mortgage interest deduction if you itemize deductions.

    We could get rid of it easily enough by increasing the standard deduction. Most people would thank us for making their lives easier.

    Make the standard deduction more like $25,000 and nobody would give a damn losing the home mortgage interest deduction, because nobody would bother itemizing deductions.

  • John||

    That is actually an interesting point. But housing has gotten so high that you would have to virtually exempt most of the population from paying taxes to get an exemption high enough to effectively repeal the deduction.

    But, the relationship would be linear. So the higher you raise the standard deduction the less the home mortgage interest deduction will distort the housing market. Raising the standard deduction would be a good way of at least reducing the distortion, since eliminating it seems to be impossible.

  • robc||

    Also interesting, people who live responsibly and pay off their mortgages often lose the mortgage interest deduction late in the mortgage as its the only reason they were itemizing to begin with and they are paying more principle than interest.

    And even if you are still itemizing, it becomes a pretty small deduction late in the mortgage.

  • John||

    The deduction encourages people to go into debt. My father could have long ago paid off his house. He chooses not to and when he moved this last time used his VA loan and bought the house no down because he the interest deduction is the only tax shelter he can afford to access. That deduction is a tutorial in perverse economic incentives.

  • Invisible Finger||

    Let's also not forget that idiotic things like 30-year mortgages didn't exist until the Depression when FDR's brain trust came up with the 30-year self-amortizing mortgage as the de facto standard.

    Most people were on 5, 7, or 10-year mortgages so the expected interest amounts weren't all that large (comparatively speaking) to begin with (and there was no income tax at the time anyway).

    Let's also not forget that the 3-year mortgage was essentially a bank bailout. Goddamn banks are as dishonest as farmers, they'll cheat and leverage as much as the government will allow and they will always beg for more and more leverage.

  • Invisible Finger||

    30-year, not 3-year

  • ||

    Anyone who can afford to pay $25,000 a year in mortgage interest is going to be in one of the top two income brackets anyway. I can't imagine the deduction makes that much difference to their income taxes.

  • Invisible Finger||

    You'd be wrong. For me it was the difference between paying $3,000 more on April 15 or getting $1500 back on April 15.

  • ||

    How much do you make that you can afford to pay $25,000 a year in interest on a mortgage?

  • kinnath||

    The mortgage interest deduction saved me about $8500 this year.

  • ||

    How much would a $25,000 standard deuction save you?

  • kinnath||

    It would cost me money.

  • Invisible Finger||

    How much would a $25,000 standard deuction save you?

    A shit-ton more.

    I am in agreement with you that the present income tax standard deduction is ridiculously small.

  • kinnath||

    And yet 47% of the population has pays no federal income tax.

  • Invisible Finger||

    So we aren't even halfway toward the goal.

  • ||

    We could also flatten the tax rate if we raised the standard deduction.

    The standard deduction is supposed to function as a kind of "cost-of-living" adjustment to your gross income. If we set it to a reasonable level the income tax would work more like a tax on net profit instead of on gross.

    Ideally, we would have a large standard deduction and then a flat tax rate on everything above that. No deductions. No credits.

    We could even vary it by zip code so people in higher cost of living areas get a bigger deduction.

  • Swiss Servator, mehr Käse!||

    "who have a tone of money and a huge amount of power in Washington"

    That is a really cool typo.

  • R C Dean||

    Indeed. There's a Reason John is no longer eligible for RC'z Law awards. He has a genuine gift.

  • ||

    Glad I am here to listen to libertarians blame government zoning on salesmen.

  • ||

    Can't help but agree. Every time I speak to any Realtor, even the one's claiming to be buyer's agents, they all want to sell me as expensive a house as possible, as quickly as possible.

    The first thing they do is advise you to get into a 30 year FHA mortgage with 3.5% down, so you can afford as big a house as possible.

    They've got absolutely no interest whatsoever in the buyer's financial best interests.

  • playa manhattan||

    Freakanomics covered this.

  • ||

    I'm too lazy to read it. Can you summarize?

  • Ivan Pike||

    Using the data from the sales of those 100,000 Chicago homes, and controlling for any number of variables---location, age and quality of the house, aesthetics, whether or not the property was an investment, and so on---it turns out that a real-estate agent keeps her own home on the market an average of ten days longer and sells it for an extra 3-plus percent, or $10,000 on a $300,000 house. When she sells her own house, an agent holds out for the best offer; when she sells yours, she encourages you to take the first decent offer that comes along.

    From here

  • ||

    Replace Realtor with Bush and your hand waving and goal post moving would read just like something Shrike would write.

  • OneOut||

    As a life long Texan who grew up in an age when going to Boystown was a rite of passage, there is an unmentioned, yet distinct, difference between US homes and Mexican's.

    Every home in Mexico is surrounded by a fence or bars for security. I'm not talking about privacy fences around the back yard. I mean serious security fences around the property and has been that way for as long as I know. Every home in Mexico is it's own gated community.

  • John||

    True. And that should make them more expensive than American homes.

  • prolefeed||

    They are gated like that because of the higher crime, which is reflected in the lower property prices.

    The price of a house on a lot is rarely anywhere near the construction cost of the building itself.

  • John||

    But the crime rate is relative. The people in Metamoris can't legally move to Brownsville. So, they are going to have to pay extra for the gated community if they want to avoid the crime.

    Your point would be true if there wasn't a border and the low crime area of Brownsville were an option. As it is, Matamorris and Brownsville have separate housing markets, similar wealth, but drastically different housing prices.

  • Raston Bot||

    They also have a Jesus statue out front.

  • Invisible Finger||

    Every home in Mexico is surrounded by a fence or bars for security.

    Zoning laws don't allow this in most American cities.

  • Invisible Finger||

    Add I would add that is because the POLICE in the US want easy access. In Mexico, the privacy is to keep the police OUT.

  • The Late P Brooks||

    But they should be able to sue you for damages if any of your dirt in the form of dirt, fumes or noise blows over onto their pile of dirt.

  • The Late P Brooks||

    Fucking tags.

    A lot of people have an absurdly broad definition of "harm" as applied to their neighbors.

    Height, architectural style, vehicles in the driveway; you know, viewshed violations. Fuck that shit. If you want control, get your checkbook out.

  • robc||

    ^^This^^

    If you want a view across my property, pay for it.

    Grow your grass as long as you want to, until critters start leaving your yard for mine.

  • The Late P Brooks||

    Libertarians never seem to get that and think someone should be able to buy into a such a situation and demand the right to use the land anyway they see fit.

    Yeah, right. The bedrock assumption of libertarianism is that contracts have no force or value.

  • The Late P Brooks||

    Also interesting, people who live responsibly and pay off their mortgages often lose the mortgage interest deduction late in the mortgage as its the only reason they were itemizing to begin with and they are paying more principle than interest.

    REFI, you Hoarder!

  • The Late P Brooks||

    Dense living is better for the environment and teaches people to tolerate difference.

    Dumber

    and

    dumber

    and

    dumber.

  • Marc F Cheney||

    What do you mean? I live in a densely-populated urban area, and I can assure you there are no bigots here.

  • OldMexican||

    "Lot sizes are smaller in Matamoros, Mexico, for example, and "Single-use zoning seems to be unknown or unenforced, as numerous small commercial establishments can be seen cropping up, mid block, along these [residential] streets."


    The reason for the small lot sizes in Matamoros (and many of Mexico's big industrial cities) is because the developers try to get as much as possible back from their land before unionized squatters try to "homestead" it away from them, which happened quite often during the 70s and 80s.

    a relatively large Matamoros starter home (915 square feet over two stories on an 1130 square foot lot) can be had for only $34,000.


    Well, Matamoros may be on the cheap side, because in industrial megapolis Monterrey, such a home can only be had for something like $64,000, which not many can afford.

    Also, credit is not very loose in Mexico, especially after the experience of 1992-1994 where we enjoyed our very own housing bubble which any Austrian economist could have see coming a mile away. There is government-subsidized housing for private workers and government workers, with all that such entails (either a lot of corruption, homes the size of an outhouse, etc.)

  • RishJoMo||

    These guys make a lot of sense dude, I like the sound of that. Wow.

    www.Anon-Works.com

  • AD-RtR/OS!||

    IIRC, there are very few zoning laws in Houston either.

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