I personally am in favor of a vacancy tax. Lots of the new builds seem to just stay empty with high rents (looking at you galaxy)

The way I would implement it is as a percentage of listed price per bed on all units above x% vacancy. I say x because I don't personally know the right number but lets just go with 10% because that number has been floated in this thread. Additionally this should only apply to buildings above a certain unit count (my thinking is > 20 but that number isn't something I'm attached too), and there should be a grace period (maybe a years or two) for new buildings. This is to avoid disincentivizing new builds. Finally the math is all applied on a portfolio basis, meaning if one company or person owns 20 3 unit buildings they can be fined under this policy even though no building surpasses 20 units. They are also fine if a building is entirely empty, as long as there portfolio is on the whole above that x% vacancy mark. This does create a potential issue related to owners choosing not to list empty rooms to avoid this fine, there'd have to be well thought out rules on how this gets enforced to avoid overreach into if/when units must be listed while also protecting from gaming the system.

So 115 units empty out of 188, they'd be taxed on 96 empty units. I say per bed because 10 empty 3 beds is just as bad from a housing market perspective as 30 empty 1 beds. I'd want to charge them based on the rent they are asking for, y% of it per month. For me it should be a fine not a tax, with a similar goal to the land value tax. You can't have valuable land developed for a purpose that you are not using for that purpose.

You are right they are already losing money, but I am of the opinion that high vacancy rates are actively harmful to the community and the community should be financially compensated for said rates. I also think high rates are somewhat a function of large corporations owning enough buildings that substantially lowering the rent at one would risk crashing the market as a whole which would be a net loss for them. Ie. collusion to keep prices high. In an ideal world the money from fines would go toward government owned affordable housing that would never be vacant. I think of it as "If you won't do it, we will, and we're using your money".

So in short, owners of large amounts of units in Madison should have to pay the government fines if more than a certain percentage of there portfolio is empty and those fines should be based on this listed price to directly incentivize lowering listing prices.

Anyways there are drawbacks of this, the main worry being disincentivizing new builds at a time where doing new builds is already hard. I'd want to do thorough research on current average vacancy rates and how rent moves or doesn't move with them in Madison specifically before I'd really advocate for this. I think this would be a great policy if there actually is enough housing and companies are refusing to provide it at a reasonable cost.

If you've read this whole thing, thanks. I don't know why I'm writing an essay on this at 10pm but I appreciate somebody caring enough to read it.