That already exists in a way - there's the concept of a primary residence tax deduction, which is (more or less) what the name sounds like.

It varies widely by jurisdiction, (not just country, but state and local government as well), but the idea of trying to differentiate residents from landlords in tax policy is nothing new.

People might try to get around this by forming corporations or trusts that hold max one property each. There is really no need to count how many other properties someone holds. Just do a re-assessment every year and ratchet up the assessed value on all housing that the owner does not occupy, including vacant property and renter-occupied. Seems a lot simpler.

Are you referring to the almost comically small property tax reduction for primary residences? Or to the mortgage interest deduction?

That is something that could be done, to a degree.

You can increase transfer taxes and offer a partial refund over the course of some number of years, provided that the home has the homeowner exemption in place.

Increase the property tax rate while also increasing the homeowner exemption so that the total tax paid is the same as it was before.

Etc.

I don’t think so. Your stats [1] are just for percent of all dwellings, many of those homes are owned by large corporations that then lease them out. If you limited it owning a single home, I think it would be significantly less, more like a 25% exemption by volume(probably less by value) this is backed up by [2] which says home ownership is around 56%. I’m fairly sure more individuals/families than you’d think own more than one home in the state.

I'm not talking about sales taxes on the sale price of a home; the US doesn't tax those either. I'm talking about property taxes, as in the taxes typically assessed by a local government to property owners as a percentage of the appraised value of their property. I'm saying that such property taxes produce various undesirable effects (as mentioned several comments up).

That's orthogonal to questions of how to deal with people owning, buying, or selling multiple homes. It may or may not make sense to apply different rules in those cases, such as not providing an exemption for sales taxes on such properties. (Though you'd have to be careful there to not cause problems with rental prices.)

I'm assuming you mean punitively tax 2nd homes that aren't being rented out?

It would tax house owners less than people who had same amount of money but didn't buy house and kept money in bank. If both house owner and renter had $1000 in bank, they would lose the same.

Which would harm the development of multi-family housing and increase the cost of living. Remember that "real workers" do not build and own 100+-unit dwellings

A. Because it's popular with swing voters.

B. Because it puts your purchase of a financed house on a more equal footing with a commercial landlord's purchase of that same house from a tax perspective. (Interest expense incurred in a bonafide profit-seeking business endeavor is tax deductible. If your private mortgage were not equally tax deductible, the tax policy would favor for-profit landlords over private homeownership. I believe that there are valid public policy reasons to encourage private homeownership at least to the extent of putting it on equal footing with commercial real estate leasing.)

To be very specific, if tax policy didn't do this, commercial landlords could literally bid more to purchase a given house than a private buyer could for a given projected rent [real or imputed] and investment hurdle rate. You could argue "well, then disallow all interest deduction!", which is a policy change that's been floated somewhat frequently, including recently, but is more complex and needs study [IMO] rather than simplistically eliminating the mortgage interest deduction and assuming that would make housing more affordable or more evenly accessible.

Having homes as a speculative investment is a great way to have an entire generation having low home ownership.

And I agree, both sides are equally worse.

With colleges, homes, healthcare, daycares, food becoming so expensive, the effects will be huge but we’ll feel it decades later

That sort of means testing isn't required (and would be open to system-gaming / perverse incentive creation anyway). You just apply capital gains tax to all properties with the exception of one primary residence per person, and you could even cap the primary-residence exemption at the median value of a home in a particular area. So if you own property and rent it out rather than living there yourself, it gets taxed as an investment, period.

So that this cost isn't just passed on to renters, you should make the rental payments for your primary residence tax deductible, again perhaps capped at a median level so as not to perversely encourage higher rents.

I think you could construct a tax regime that was revenue neutral pretty easily this way.

I have no idea who is downvoting you. That's absolutely correct.

If they really wanted to subsidize ownership they would make it tax deductible to pay down principal. (And then give you zero tax basis so it's all taxable income when you sell, and cap the maximum sunk deduction per person at the median home value so rich people don't buy twelve houses to avoid their taxes.)

I dream of a 100% tax rate on second homes, foreign ownership, and corporations owning single family homes and condos. Or even better, make it illegal. But any politician who pushes such a bill would immediately get removed from office and the law repealed.

With the recent tax changes including increased standard deduction, SALT cap and mortgage deduction cap, this bias is greatly reduced.

But doesn't the tax code distinguish between a house which houses its owner and one which doesn't? I don't think investment homes are treated tax-wise the same as normal homes. I am not aware of tax advantages being extended to investments just because those investments are houses, but maybe I am wrong?