- Santa Fe voted overwhelmingly for a brand new tax on houses bought for greater than $1 million.
- The brand new 3% tax will fund reasonably priced housing development and upkeep.
- The vote signifies sturdy help for so-called “mansion taxes” throughout the nation.
Santa Fe desires its wealthiest residents to fund housing for the neediest.
On Tuesday, the New Mexico metropolis overwhelmingly authorised a so-called mansion tax, which can levy a 3% excise tax on residential property bought for $1 million or extra and use the income to fund reasonably priced housing.
The tax, supported by greater than 73% of voters, solely applies to each greenback over the $1 million threshold. For instance, patrons would pay $30,000 in additional taxes on a $2 million house.
The brand new tax is predicted to lift about $6 million yearly for Santa Fe’s reasonably priced housing belief fund, which is used to construct and keep low-income housing, and assist low-income residents afford mortgages and lease.
Santa Fe has grow to be a lovely house for retirees and digital nomads, who’ve purchased up a major quantity of property because the pandemic hit. And an increase in actual property prices displays that surge in demand.
“We’re attracting people who can Zoom to work elsewhere and reside in an excellent place with nice local weather and tradition and historical past and meals,” Santa Fe’s Democratic Mayor Alan Webber advised ABC Information. “We have grow to be a magnet, and we do not wish to lose the area people that has lived right here all their lives, or for generations, and to abruptly see that variety give option to solely higher-income individuals.”
The Southwestern metropolis is not alone. A number of different main cities and states have proposed or not too long ago handed mansion taxes, or another tax enhance to fund reasonably priced housing.
Seattle voted on Tuesday to triple its property tax that funds reasonably priced housing and aids low-income tenants. The bigger measure replaces an expiring model of the tax and located broad help within the metropolis.
Final 12 months, Los Angeles handed the Homelessness and Housing Options Tax, which imposes a 4% switch tax on all actual property bought for greater than $5 million and a 5.5% tax on property over $10 million. The brand new tax, which applies to each business and residential actual property, went into impact on April 1, 2023. It is anticipated to gather greater than $900 million yearly for use for reasonably priced housing development and upkeep and to supply low-income tenants going through eviction with attorneys.
In Chicago, the town council not too long ago superior a proposal to bump taxes on houses bought for greater than $1 million in an effort to lift greater than $100 million to deal with homelessness. New York State has lengthy imposed a one p.c mansion tax on houses over $1 million, however in New York Metropolis the tax rises incrementally as the worth of the sale will increase, going as much as 3.9% for houses bought for $25 million or extra.
However some cities have turned down comparable efforts. Voters in Cincinnati, Ohio on Tuesday rejected a proposal to create an affordable-housing development fund by elevating its earnings tax.
