Seattle real estate speculation tax

Photo: Daniel X. O’Neil/Flickr

Since British Columbia began taxing foreign buyers and empty investment properties in Vancouver’s hot housing market last year, Seattle leaders have been considering similar policies to counter the city’s housing affordability crisis. According to the Northwest Multiple Listing Service, the median home price in King County is up 18.6 percent over the past 12 months and the median home price in Seattle in July was $748,500.

With Seattle’s upcoming November election for mayor on the horizon, mayoral candidates are making their views on a potential speculation tax in Seattle known. Candidate Cary Moon explained to the Seattle Times that she would first “analyze speculation activities — not actors — in our escalating real-estate market,” then “propose legally viable taxes to curb the profiteering exacerbating our housing affordability crisis.”

The idea of a speculation tax first gained attention when Seattle City Councilmember Lisa Herbold asked King County Assessor John Wilson if there was a way to create a database of “speculative investors,” especially purchases made under “LLCs or shell companies,” that is “neutral about the national origin of the investor.” Wilson responded, concerned that Herbold was suggesting Seattle create a database of investors based on national origin, particularly investors from China. Wilson alleged this kind of policy would stoke racist sentiment.

When the Times reached out to Moon and candidate Jenny Durkan for comment, they both had a different take. Moon stated, “I applaud Councilmember Herbold’s initiative to better understand speculation activities, share Assessor Wilson’s concerns about efforts to identify investors by national origin, and believe starting this work with a focus on the identity of purchasers puts us on the wrong track.”

Candidate Durkan’s spokesman had a less forgiving response. “Jenny believes strongly that taxes, penalties and bans based on nationality are wrong and illegal,” Durkan spokeswoman Stephanie Formas told the Seattle Times. “Changing the name to ‘non-resident’ does not change the fact that this started as anti-Chinese buyer tax. Seattle has a dark history of discrimination against people of Asian descent, such as the Chinese Exclusion laws and the mass internment of Japanese. We cannot go there — particularly in the age of Trump.”

The clash continued, with both Moon and Durkan releasing statements throughout the day. “The government database based on national origin is a figment of the Durkan campaign’s imagination,” said Weiner over email to Curbed Seattle. “There’s nothing in anything Moon’s ever said or written that even mentions this.”

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