The Organisation for Economic Cooperation and Development (OECD) and the International Monetary Fund (IMF) have done extensive research about the economic crises and the reasons for it. First, this article presents the house price indexes compiles by OECD. Then, it details the main conclusions about the factors which encouraged the formation of the real estate bubbles. It explores the consequences of tax policy choices and discusses the role and implementation of the different types of property taxation in various countries. Next, the article compares the real estate markets in three countries: Denmark, Germany, and the United States. Denmark had one of the earliest and most acute real estate bubbles. The bubble in the United States is credited with triggering the global financial crisis in 2008. Germany had no bubble at all. This article examines the factors that contributed to the real estate market results in each country. It also looks at the role of government policy in the formation or prevention of house price bubbles. Finally, the article presents the problems real estate bubbles can create for local governments, particularly those that rely heavily on property tax revenues.
Economic development affected by the property tax
This paper was presented at the 12th International Conference, Land Value Capture in Urban Development: Role of Property Tax in Local Finance, held in Warsaw, Poland, June 23 and 24, 2009. The conference was jointly sponsored by the International Property Tax Institute (IPTI) and the Institute of Revenues, Rating, and Valuation (IRRV).
Muller, A., Almy, R., & Engelschalk, M. (2010). Real estate bubbles and the economic crises : The role of credit standards and the impact of tax policy. Journal of Property Tax Assessment & Administration, 7(1), 17-40. Retrieved from https://researchexchange.iaao.org/jptaa/vol7/iss1/2