Boston City Councilor Lydia Edwards introduced a proposal that would allow for Boston to tax six percent on real estate transactions over $2 million earlier this week. Primary owner-occupied residences would be exempt from the tax.
The councilor believes money generated from this tax could go into creating more affordable housing in the city.
“We are struggling to keep people in our communities,” she said during a public hearing this week.
The proposal also includes a 25 percent tax on properties sold more than once in two years. This would be an effort to discourage flipping houses.
“Flipping is not good for any neighborhood. Boston is up for grabs and up for sale. That is not a Boston I will continue to allow,” said Edwards.
Her colleague Kim Janey agreed saying flipping could cause residents being forced out of Boston.
“Flipping may sound like it improves a neighborhood. What we see is that it can displace residents,” she said.
Janey said flipping also leads to lower quality work on homes.
Boston Housing Chief Sheila Dillion said Mayor Martin Walsh wants to create 69,000 new housing units by 2030.
However, Edwards said this isn’t enough to deal with the housing crisis right now. She said the city needs to stop creating luxury condos.
“It does not create more family homes. It does not create a middle-class growing city,” she said.
Karen Chen of the Chinese Progressive Association said this is a big issue in Chinatown and Downtown. She has seen ownership turnover create inflated prices for rent. She mentioned how a building was sold on Tyler Street for twice the market value then turned into short term rentals.
However, those in the real estate world worried about the impact this could have on development.
“They will learn how to work the system,” said Melvin Veira about home flippers. “They will pass the buck to the little man.”
He also said this could cause developers to turn away from Boston limiting job opportunities for citizens.