Chicago seeks to shelter the homeless by further increasing the tax burden on taxpayers.
The Chicago Council Housing Committee presented a proposal called "Bring Chicago Home." It includes a so-called "mansion tax" that would raise the real estate transfer tax rate on properties worth more than $1 million from 0.75% to 2.65%.
Supporters of the bill claim that implementing the tax hike would result in an extra $163 million that would be used to build permanent housing for the more than 6,000 people experiencing homelessness. According to the campaign website:
The money generated by the tax would be legally dedicated to programs that alleviate homelessness, including assistance for children, veterans and women recovering from domestic violence.
However, some experts say that the city's housing market - already weakened - could suffer if the measure is approved. Chicago Association of Realtors spokeswoman Amy Masters warned that the new proposal would "nearly triple some property transfer taxes by as much as $30,000."
Market research suggests that Chicago office buildings have lost 50% of their value, and we estimate that nearly half of Chicago office buildings are in some state of financial distress.
Despite warnings, radical Mayor Johnson supports the measure
Another trade association representing the real estate industry in the state, Illinois Realtors, revealed that sales and housing supply have been declining over the years. From June last year to the same month this year, sales had dropped by more than 25% and supply by more than 30%. Therefore, the measure would only further worsen a weak market that has been deteriorating over the years.
Despite all warnings, the city's mayor, Brandon Johnson, expressed his support for the proposal on social media, "My administration is committed to Bring Chicago Home and building consensus around providing affordable housing to combat homelessness in our city."
Today at 2 p.m. the City Council Committee on Housing and Real Estate will meet to address Chicago's crisis of the unhoused.
My administration is committed to Bring Chicago Home, and to building consensus around providing affordable housing to combat homelessness in our city.
— Mayor Brandon Johnson (@ChicagosMayor) July 27, 2023
