Santa Fe considers tax on mansions as housing prices soar

abcnews.go.com:

Outrage over the price of basic housing is spurring calls for a tax on mansions in a Southwestern city cherished by tourists and second-home owners for its adobe architecture and Rocky Mountain vistas

SANTA FE, N.M. — Voters are deciding whether to tax mansions to pay for affordable housing initiatives in a state capital city prized for its desert-mountain vistas, vibrant arts scene and stucco architecture rooted in Native American and Spanish-colonial tradition.

The tax on homes sold for more than $1 million is being pitched as a lifeline to teachers, service-sector workers, single parents and young professionals who can't afford local mortgages or struggle to pay rent amid a national housing shortage and the arrival in Santa Fe of high-income digital nomads and affluent retirees.

The Nov. 7 ballot measure is the latest bellwether for the popularity of so-called mansion taxes to fund affordable housing and stave off homelessness. It comes on the heels of a voter-approved initiative in Los Angeles and new proposals from Chicago to Massachusetts.

If approved, the measure would add a 3% tax on residential property sales of $1 million or more — with no tax on the first $1 million in value.

On a $1.2 million home sale, for example, the new tax would apply to $200,000 in value. The buyer would pay $6,000 to the city's affordable housing trust fund.

The city estimates that the tax would generate about $6 million annually for the trust, which underwrites price-restricted housing, down-payment assistance for low-income homebuyers and rental assistance to stave off financial hardship and evictions.

The trust awards funds each year to affordable housing providers who can secure matching funds from other government and nonprofit