> Why not use it?
It dramatically cuts housing security, and allows local governments to inflate their own property values by doing what is basically eminent domain without the requirement to show need. Make everyone pay taxes, use those to buy up homes, re-list the homes at a higher price. They can effectively price gouge using tax dollars. This could happen to you at literally any point, and that local government doesn't care if the house won't even sell as long as the other houses rise enough in value to cover the lost tax revenue.
I've also heard the same thing but allowing private citizens to buy them, which is almost worse. Anyone sufficiently well off can just wreck someone else's life. If I hate my neighbor and they report the real value of their house, I can force them to sell it to me so they have to move and I can resell it while only losing fees in the process. They would have to over-value their house by an amount that I'm not okay losing, which ends in a sort of auction of escalating values. At the very tippy top, if I'm Warren Buffet's neighbor there's probably not a value I can pay taxes on that would stop him from buying me out if he wanted. Any number that would be a meaningful loss to him is something I can't even pay the taxes on.
I wasn't explicit, but I was proposing this for the same non-primary residences that the NY law is talking about.
Now that I've explained that, do you still think this would "dramatically cut housing security"?
If you still feel this would make housing "insecure", because someone's secondary home, if it has a value over $1 million, is subject to this system I propose, then you and I have a fundamentally different idea of what "housing security" is.
No, I don't have any fears about housing security, that changes the concerns to be primarily around corruption on both sides of that.
On one hand, we're talking about taxes large enough to be multiples of a public official _per home_. Open bribery is an option, but there's also the potential to push some money into campaign funds for whoever controls the department in control of this and then under-valuing the home by a huge margin. The home valuation is subjective here, so there's no perjury for under-valuing your home by a huge margin.
The other side of this is more brazen, but would involve someone having some kind of influence over the government official that makes buy/not buy decisions, intentionally over-valuing the home, and then having the government buy it.
I also just don't really understand the point. In order for the government to make sane "buy or not buy" decisions, they have to know what the house is worth on the open market. If they already know what it's worth, why not just tax that value and skip these hoops? If they don't know and can't find that number then this policy is going to be a crapshoot because they don't know if the home owner is undervaluing the home or if that's what it's actually worth.