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Comment by seanmcdirmid | Hacker News Reader

Ya, property taxes should act against such behavior, but many places like Vancouver lack one. Not sure about NZ, but it seems like property taxes are more of an American thing.

Edit: oops, Canada does have a property tax, and New Zealand has something like it. So it’s just Australia (on first residences) and the UK that don’t. Well, China also. I’ll take my downvotes gracefully.

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Homeowners do pay property tax in Vancouver:

https://vancouver.ca/home-property-development/property-tax....

There are property taxes here in New Zealand, known as ‘rates’.

You can look up what they are for a property and get an idea of the property value on local government websites.

https://www.aucklandcouncil.govt.nz/property-rates-valuation...

They are absolutely minimal though, works out to about 0.23% of value (aware that’s not the only component) for us in Auckland.

Yeah, this is a relatively important metric for both investing but also affordability. It shows that there is an apples to oranges comparison in housing prices across markets (discounting currency differences).

When calculating the affordability of a home, the total monthly cash flow requirements (housing costs as a percentage of income) are critical. I live in an area where the rates are 10x that of Auckland. A $600k home valuation requires a ~$250 weekly rate commitment vs only about $27 in Auckland - a significant difference. It's still an expensive home by any metric, but considerably more affordable.

From a speculation perspective, an investor in Auckland can sit on a very expensive property with almost no cash flow burden, reducing the need to even rent.

We pay property tax in Ontario.

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