The Jason Theory
Jason Stratton of KlopasStratton Team, a top 20 team in the nation with over 1.5 billion sold , sits down with weekly guests to talk about becoming successful, the real estate market, and crazy stories/people we run into. Visit www.klopasstratton.com to see more!
The Jason Theory
S4 E10 - Taxes, Zoning, And The Chicago Affordability Squeeze . Why Capital is fleeing and how to bring it back to Chicago
We break down why Chicago’s housing is so expensive. Despite record taxes, the city is at an all-time high in debt. What would it take to attract capital, build more homes, and lower prices? We share data on schools, zoning, conversions, and policy incentives that could restart growth.
• highest taxes paired with large deficits and lender uncertainty
• CTU costs and poor literacy and math outcomes are driving distrust
• capital flight, bank redlining, and private equity debt costs
• stalled office-to-residential conversions and rigid mandates
• aldermanic control and downzoning that choke density and raise prices
• case study on 4330 N California and infeasible set-asides
• renters versus owners, community stability, and wealth
• Northwest Ordinance fees lower legacy owners’ equity
• a practical plan to incentivize office return and revive transit, retail
• three levers for a city: taxes, cuts, or growth, and why growth wins
A developer goes to a bank and says, Hey, I want to build uh one Chicago. I want to build a massive building. I want to provide housing for 3,000 people with this one building or 2,000 people, whatever it is. The bank doesn't just evaluate the developer. He's got to evaluate the city. The bank wants to know okay, when we're building this, what are our costs? What are our debts? And here's the problem. We have such a messed up tax situation and such huge deficits that banks don't know where property taxes are going to be. Do you remember it? Proper preparation, rental performance. There you go. It doesn't matter how much money we get. If we don't close, it's no money, right? So no close is no money. I'm everything that I am because of my dad's death. And I wouldn't be as successful without his death. Hello, everyone. Welcome to the Jason Theory. I am by myself today, and I love it. I started off doing this by myself before we had guests, and I thought I would do it because I am going to talk about a lot of things that are affecting the city of Chicago, which in turn infect real estate and affect families. So I would say at this point, if you're easily offended by data and truths, you turn this off. But if you want to have a great conversation and, you know, for the next 45 minutes, really, as my uh as my philosophy teacher used to say, one of the greatest words he told me, he's like, Jason, half a life is about mental masturbation. And I love that. He was my ancient philosophy teacher and my logic teacher. And basically, like, we're gonna dive into some thoughts. The first thing I want to talk about is our glorious city, Chicago, which I do love. First off, I want to say that I was born in Edgebork, which is just the north side, kind of like west off of 90, off of Kennedy, and uh was there till I was four in the city. So I was born in the city, then moved to the western suburbs, made it a little bit easier for my dad to get to work, and then moved back to the city. And I've been in the city now since I was uh a late teenager. So it's been a while. It's been, it's been great. I love the city of Chicago. Um, however, um to as of yesterday, we are the highest taxed city in America. Now, if we're the highest taxed city in America, how come we have proportionally the largest deficit? So wouldn't it make sense that if we collect more taxes on our citizens than any other place, that we should at least maybe not have a balanced budget because no one knows how to do that anymore, but at least have some sort of money in the coffers. Um, this is an issue. And this is one of the affordable issues, affordable housing issues, because our tax payments, our property taxes, which our glorious mayor wanted to increase by 30% and got voted down the first time that every single alderman said no to a mayor. Uh, thanks God to the aldermen. We'll get into them and their little fiefdoms and how we are basically in a kingship here in Chicago. It's very interesting that we had a march for no kings when we live in a city that has a mayor and then has these little people, and then they split up our little things. So our little areas. So if you do do any reading, or if you don't, you may want to read on how uh kings and lordships were done back in the day. Uh, it's kind of a Chicago setup. So we have multiple layers for people to steal and multiple layers for corruption, because there's 77 corrupt people that are in charge of these areas, and that actually gets into affordable housing too. So you have this massive tax burden when you buy a property that recurs every year. Um, this is part of the unaffordability. So when you buy a$400,000 home and you have a$10,000 tax bill, and every other state's like a$2,000 or$3,000 tax bill, that affects affordability, right? Because that's part of your payment. Now, what are we getting for these taxes? Well, I that's the big thing, right? What do we get for these taxes? What do we get for the$100 tax bill that's on my internet and my um my uh TV? I mean, when's the last time you looked at your TV bill and your internet bill? Uh, amusement taxes, taxes here, taxes, you know, the minute you walk out of the city of Chicago to fill your gas tank, it goes from$4 to$275. Um, gas isn't cheaper um across the city-state. Like it the sit, the the it doesn't like it doesn't magically become cheaper to bring tax to bring gas to Glenview than it does to Chicago. Those are all taxes. Um the highest tax city, and all we're talking about is the fact that we can't provide services. Well, where does all that money go? And that's what you really have to think about. So I start thinking about okay, well, there's a ton of kids in the city of Chicago. Let's talk about our school system. Let's talk about the CTU. Let's talk about the fact that the city of Chicago spends more per pupil than any other city in America. And you're saying, how much? Right? This is all data facts. You can look this up. I got my computer just in case I forget facts.$34,000 per kid is what we spend per child in the city of Chicago. Um, 75% of the people in the city of Chicago that go to public school cannot read at their level. So we're spending$34,000 per student. 17% of Chicago goes to private school. So 17% of the city is not even paying into the system. But hold up. There's a ton of people that don't have kids or empty nesters that are paying into the system. So 50% of the tax dollars that we collect for public schools don't even go to families that have kids. So we're talking about double the amount of money, right? When you look at your tax bill, it breaks down all the money. And the biggest take on that is our public school system. Now, I can talk about this because my kids go to public school. What I don't want to hear from is people that don't go to public schools that have their two cents in the public schools. I don't want to hear from public officials who send their kids to private schools, aka Lori Lightfoot. She's cutting deals or she cut deals for CPS and the CTU, and her kids went to FXW and then went to DePaul. Why are we allowing people to pass laws on us and our kids and our state that don't actually use public services? Why do people in government are not on the same medical stuff that people are? If our medical system is so amazing and our insurance is so amazing and all this, why are they not on ours? So they can vote and they can pass laws that affect our school systems, our taxes, our houses, but yet they don't participate in that. I mean, think about having a governor that is going to rule on a state and not live in the state. Now, yes, for people that understand Pritzker, he did leave the state, went to Wisconsin and went to Florida because he had a private jet. So when the airports were closed, he could still leave and govern and close down our state from another state, which is just insane to me. But why would we want that? I mean, people have to participate in the public good if they're the ones that are applying laws on that. That just makes sense to me, right? I want somebody that's has their kids in CPS if they're gonna govern laws on CPS. Now, Brandon Johnson's kids go to CPS. I will give him that. Like, that's honestly the only thing I will give him. But he does. Um, I've seen him at baseball games at CPS baseball games, and we played his kids' teams. Um, but he's the first mayor to have kids go to CPS in a long, long time, right? Now, now we have other issues with him because we elected a mayor who our biggest issue right now is the CTU. It's drowning our city, and yet we hired him, we voted for a mayor that is was a basically uh a crony for the CTU, right? So that causes issues in itself. It's conflict of interest. The man was given a ton of money for his for his uh campaign by CTU, which seems to be another conflict of interest. And when he didn't like the fact that the president of the CPS stood up to him, he just had him removed. And we're gonna get sued for that, and they're gonna have to cut money for that. So that's it all goes back to the taxes. So that's kind of how I started. I went off on tangents, and that's what you do when you mental masturbate. You go on tangents. So the taxes. So we're the highest taxed city, and per capita we have the biggest deficit. So where does that come? What what's going around with that? What are the issues that we have to do? Well, the main issue is we have no receipts. We have no capital. Okay, and let me tell you what that means. This has to do with housing. Capital needs capital, right? Capital has no bias. Money has no bias. Money sees nothing. The dollar bill has no eyes on it. But the dollar bill goes to where it can reproduce. Capital goes to where capital can make more capital. And that is the major issue with Chicago. We don't have the capital coming here because it's not a conducive space for capital. Um, most people don't know this, but almost all the buildings that are being done here, or any projects being done not by banks, because banks have redlined Chicago. What that means is big projects in the city of Chicago will not get funding because no one understands how to underwrite a project. Let me explain that to you. When you have a huge project and you're like, I'm gonna go to the bank, let's talk about getting a loan. I want to get a loan for the bank for a house. You go to the bank and they say, let me see your tax returns, let me see your deficits, let me see your credit scores, let me see how much debt you have, right? They evaluate that. And then they evaluate that if they say, Hey, you know what? We're gonna loan you the money because we know you're gonna pay us back by what we looked at. Now, when a developer goes to a bank and says, Hey, I want to build one Chicago, I want to build a massive building, I want to provide housing for 3,000 people with this one building or 2,000 people, whatever it is. The bank doesn't just evaluate the developer, he's got to evaluate the city. The bank wants to know okay, when we're building this, what are our costs? What are our debts? And here's the problem. We have such a messed up tax situation and such huge deficits that banks don't know where property taxes are gonna be. AKA, Brandon Johnson saying, I'm never gonna raise taxes, and then says, hey, I want to raise taxes 30%. When the bank doesn't know how to underwrite a loan, how to look at this is what the project makes, but this is what, when we're carrying it, this is gonna be our deficit via taxes. They just won't underwrite a loan. That's why you only see rental buildings being built. That's it. Because they know that they can fill the rental building and not be stuck with units and then get hit with a massive tax bill. Literally redlined. They will not lend in the city of Chicago. So how are we getting money in the city of Chicago? Well, it's coming from private equity. Hedge funds are the ones that are loaning money like a loan shark to developers. Well, what's the problem with that? Well, developers have to make money, right? Everyone that's working, if you're listening to this in your car, you're listening to this on your radio or your headset, whatever you're listening to this on, you're probably going to somewhere to work or you've worked. And if you don't work and you're just taking subsidies, we'll get into that too. But you're working. I don't think anyone here wants to go to a job and then when they leave, cut a check, right? Like, oh, thanks for working all day. Uh, before you leave, you owe us 500 bucks because having you here costs us more money than you're producing. Well, that's what we're asking people to do, right? Hey, developers, we want you to come here and build, but you're gonna lose money when you do it. Well, what would a developer say? I can tell you, I've been to all these places. I've been to Biz now, I've been to the state of the markets, I've been to all of them. There's only one guy still building in the city of Chicago, Jim Letcher, JDL. God bless him. Great guy, great developer. Probably, you know, is shaped the city of Chicago over the last 20 years. Everybody else has left. Why? Because the capital doesn't make capital. So we got nobody building anything, right? And then on top of it, you've got this corridor in LaSalle. We're gonna re-renovate LaSalle corridor. We're gonna re-renovate Michigan Avenue. We're gonna turn these buildings into residentials. Okay. The buildings are worth more if they were torn down. Let me, let me, let me say that again. The building in the land is worth more if they were torn down and then they could build new. But these buildings are landmarked. So we have buildings that are class C offices that are empty, that could be thousands of units that could come to the market and drive the price down, right? Supply would drive the price down of these homes. However, there's laws on how we have to retrofit these units. And you can't have a bedroom without a window. I get it. But I think I'd rather have 2,000 more units driving down the price and increasing supply and just say, hey, listen, in this building, in this unit, if you want to buy it at a discounted price, there's just no window in this bedroom. We've got light, we've got vent, you've got heat, you've got air, just no light. No. City's like, no. We'd rather have this building sit down and produce nothing, produce no tax revenue, and just literally be an empty building. All right. But that's not it. No, no, no, no. That's not it. On top of it, on top of the fact that you can't retrofit these buildings, these buildings have to be 25% affordable. Now listen, I am for affordable housing. However, the way to create affordable housing is supply, not choking supply. Understand that. Supply and demand is a very simple demand, is a very simple X and Y axis. And this would be no demand. I'm sorry, this would be no supply, and this would be supply. And this is price. Watch this. No supply. What's happening to price? It's going up, it's going up, it's going up. Supply, more supply, more supply, price goes down. This is infallible. The supply and demand chart is infallible. The more supply you have, the more prices go down. Period. End of story. I will tell you in Argentina, a new president took over, and Argentina had rent control and had no supply. He took off rent control. You can read this. This is documented. He took rent control off in Argentina. So much capital came into Argentina that the average price of the two-bedroom condo became lower than the rent control price. That's documented. There's so much data on this. This is the pulpit politics, right? You're saying something, but you know that it can't be done. And all we're doing, all we're doing is stifling the demand. So if no homes are being built, if you have all these empty homes that are not bringing in receipts, the houses are getting too expensive for people living, and we're overtaxing, what happens? People move. When people move, what happens? Your tax basis drops, the amount of receipts you take in. So all of a sudden, money is flooding out, right? Money is flooding out, and you're like, where am I going to get money? Will it just keep on pounding on the people that are making? Listen, we everybody has a computer now. You don't have to stay in Chicago to make money. You can move around. And guess what? People are going to move around where their dollar gets them more. The same way that capital wants to make money, people want to save their capital, right? And that's what's happening. So what we need to do is create supply. How do we do this? We have to lower the restrictions. We have to, and how do we do this? We increase zoning. Now, here let's get into the alderman. This is the inner workings of Chicago. Now, now we get into the Alderman. When I moved to Bucktown, everything was R4. R4 means you can build three units. Okay? One, two, three, duplex down, simplex, simplex, whatever you want to do. You can build three units. As soon as Bucktown became affluent, they downzoned it. Why? They went to single families. Because the people that lived in Bucktown did not want multi-units. And the people that are putting these aldermen in power and paying them and their constituents are saying, no, we don't want it. Right? It is so easy for us to create affordable housing. We don't need to go after developers and put restrictions on them that they don't build, anyways. All we have to do is ease the zoning. That's it. But they won't do it because the people that keep them in power don't want multi-units next to their$2 million homes. I mean, look around. You can't get zoning changes. The alderman will be like, don't even come to me. Hey, man, you know, I'll give you a real life example. 4330 North California. Look it up. Get on Google, look it up. 4330 North California. We wanted it's a per zoning, it was six units. However, the developer wanted to diversify his risk, but also wanted to provide one bedroom, two bedrooms, and three bedrooms. We're like, all right, Alderman says, I'll let you build 12 to 15 units, but 25% have to be affordable. Well, here's the problem. When you're selling a$400,000 unit for$200,000, the project becomes insolvent. The capital can't expand. It can't, it can't make money. The same way that you don't want to go to work and cut a check for going to work. I'm going to go to work, but I'm also going to pay you for me to work. So I'm not going to make money and I'm going to pay you and give you a hard, give you a full day's work. That doesn't work, people. It doesn't work in any situation. So we said to the Alderman, hey, we want to provide different things. The Alderman says, Well, do you have three bedrooms in there? I'm like, Yeah. It's like, well, for affordable housing, for me to approve this, every unit has to be the same. I said, well, that just doesn't work. You want everything to be the same. And he's like, well, listen, the affordable housing unit should look the same as the regular rate. Now let me tell you something. How does that make sense? How does it make sense that a person would spend 600 grand or let's say 400 grand on a 2-2, and then you got to sell the same unit for$150? I'll tell you what happened. We said, forget it. We're going to stay by right. We're going to build six units. And we built the six most expensive units at that time in Horner Park facing the park at 4330. And they also at record pricing. Did we want to do that? No. No one wants to be like, I want to build the most expensive house on the block. That's like that's like real estate 101, right? You want to provide different units. However, they wouldn't let us. Now, how does that make sense? How does it make sense to not sell this to sell six$600,000 units, then$12,000,$350,000 units and get more people in that area in that space? Right? People that move to Chicago and want to buy a house, right? Or want to buy a condo and they can afford$300,000,$350,000. If you, and I know that's a lot, but let's be relative. It's the city of Chicago. So like I know if someone's listening to this and somewhere else, say for$350,000, I can buy 17 farms. I get it. I'm going to stick to Chicago. People are frustrated because you can't make$150,000 and buy a home, right? So what do they do? They got to go to a rental building. What does a rental building cost? It's$4 a foot. People are spending 50% of what they make just on their housing because there's nowhere else to live. They're not building equity. They're not invested in the city. We got all these people renting, right? Everyone's a renter. Who like, how do you become part of a community when you're just a hired help and you're just you're just renting? You don't. You don't take pride in that community. You don't have ownership in that community. All that matters, that matters for a city. To have ownership. It matters for you. Listen, you have power via owning property. Ownership gives you power. When you rent, you are the subject to the owner of the building. At their whim, they can kick you out, they can change the rent, they can do anything. You're not establishing wealth. Now, if you want my two cents, I don't think they want you to establish wealth, but that's another topic for another time. Everybody wants, right? The guy that the guy over at uh that's running the Europe now, the monetary, the the head of the money. Sean, help me out. Schultz. He doesn't want, he is on record that no one should own anything. Why? Ownership gives you power. Owning property gives you power. Everybody should own a home. Like everyone thinks, oh, realtors, they want the price. No, man. I want everybody to own a home. I want everybody to build wealth. And that's the only way that you can build wealth. Listen, you can build and you can make some machine that changes computers and this and that for sure. You can make a rocket. Right? But eight out of ten millionaires make it from real estate. Thank you. Yeah, he's Satan. Literally. We took the person now. He's BlackRock, right?
SPEAKER_01:Yeah.
SPEAKER_00:The World Economic Forum, the head of it, is the head of the person that wants to own the whole world. So we put this guy in charge who wants to hone the whole world. He wants everyone to be ownless, not to own a car, not to own a house, not to own anything. He says we should be a rental society. When you're a rental society, you know what you are? You're a pawn. You're a pawn. Right? You don't have any wealth. So that is my main thing. Now, getting back to the highest tax city, I know I got a little off the spot, but we should be getting something for our tax dollars, right? And it starts with us and the CTU. And I want to say something. We need to put the kids first. Do we want to see Chicago thrive? Chicago only thrives through education. People only get out of situations that they don't like through education. There's two things that I'm passionate about. That's clean food and people being educated. And no one's being educated without clean food. That's a thing for a different space, different time. We've had nutrition design before, but we have to have education. We can't have 75% of the city of Chicago not reading at their level. We can't have 90% of the city of Chicago not doing math at their level. Education is the only way to get to where you want to go. That's it. And that squarely falls on the CTU and Johnson. Now, we've had this issue now for 20, 30 years. And we've had the same leadership for 20 or 30 years. Right? I believe it was Einstein that said the definition of an insanity is to do the same thing over and over again and expect a different result. When are we as people in the city of Chicago gonna get up and vote and be like, we need change? Right. And I'm not talking about pulpit change. Like we need affordable housing, even though we're gonna make the laws that no one can have affordable housing. You know, I'm talking about real change. I'm talking about cleaning up what we're doing and really providing change and providing education. Instead of us giving band-aids and handouts, let's educate people, let's lift them up and let's get them where they need to go. You know, I know there's a ton of talk about Snap and what's going on with the food because the government shut down. But why was there such an outrage when they said, hey, you shouldn't be able to buy soda and candy with Snap? Why is there an outrage that we want our kids to eat healthy? Right? The brain only survives with healthy food. It only can achieve what it can achieve with the proper proteins and the proper nutrition. However, we're mad that we're not allowing people to give their kids garbage. That garbage in your brain, and when you're your kid's in class and he's got he's hopped up on Pop Tarts and sugar and coke. How how they gonna learn? How are they gonna sit still? We just gonna medicate all these kids, right? You think they have ADHD, or maybe they're just piled up with sugar. That could be it. Give some people some vegetables, some milk, and some protein, and let's see what happens to them in the classroom. These are the things that and all this, the reason I'm talking about this stuff with people, because all this is what builds our city. And all that has to do with real estate and values and people that want to stay here. You know, my clients are always like, I can't believe there's three offers to every house, five offers to every house. We have no inventory. We have 15% less inventory than last year, and last year was a record. So every year we break records. Why are we not building homes? Why are we letting that's why prices are going through the roof? We're not building homes. You know where home prices are dipping in the South and the West, where the restrictions are lighter on building. And everyone's like, oh, you know, the market's changing. You know, Florida's gone down three or four percent. First off, relax. Florida's been up like 50, 60% over the last 10 years, and possibly could jump another 15 from people moving from New York. So relax with Florida. However, what's the problem with prices going up and down? What's the problem if prices drop in the city of Chicago by 20%? So people don't have a gazillion dollars worth of equity. Well, listen, prices will dip to a certain point and people will come in and we'll start buying. But we need supply. And the supply can only be done by the city allowing supply to be built. Supply can only be done by capital wanting to come to the city of Chicago to build homes. That can only be done when our taxes are intact, when the crime is intact. So all this matters. And it has everything to do with housing, and housing is everything to do with that. It's not just there's just not one part of the city that lives in an ecosystem by itself. It's all together. It's all together. It's Alderman allowing for zoning changes. Hey, man, we want an extra unit. This or that. Oh, you let's talk about the fact that everyone's like, oh, they're gonna allow um ADU units, they're gonna allow um units in the garden, they're gonna allow for units on the garage. Have you read? Have you read about this? Or do you just learn your news from Instagram? Read what they want. They want city certified developers, only ones to build that. Now, that's like a no-bid system. I don't know who's gonna build it. Are they gonna jack the prices? Is it gonna be affordable? I mean, it's already$220 to build a foot to build something. Used to be$140. It's$220. Right? Read the fine print. All these things that you hear that are amazing, when you read it, it's impossible to do because the restrictions that they do, everything that goes on. Bill Maher was on a couple weeks ago, and I watch him, and he was like, I'm I want to put a new garage door. This is all over Instagram too. I want to put a new garage door on my, on my, on his garage in California. Took three inspections to change a garage door. Not to build the garage, to change the door. They still haven't done anything in the Palisades because the amount of bureaucracy and the amount of garbage that goes through that place. Think about that. I mean, that's what's important is getting homes built, forcing the price to go down. Now, people that own homes are probably like, we don't want prices to go down. Well, that's what the people that are that tell their ultimate less homes, less homes. Our prices go up. Is that for the is that the good for everybody? If everybody can start to afford homes, it trickles everywhere. Listen, when you do stuff right, when you've been doing stuff wrong for so long, when you turn around and do it right, the first time you do it right, there's gonna be pain. There just always is. When you're doing things wrong in the government and you turn around and you want to start doing them right, there's gonna be a year of pain.
SPEAKER_01:Right? There just always is. Because it's been wrong for so damn long.
SPEAKER_00:I mean, there's a reason why we pay$1.2 trillion in deficit spending. It's not because we're doing it right.
SPEAKER_01:If we were doing it right, we'd have a balanced budget, right? I mean, the Alderman passed the budget. The mayor passes the budget.
SPEAKER_00:I mean, if I ran a company, if I ran my real estate company where I was incurring massive deficits every year, how long would I be in business for? And we just keep re-electing these people. That's insane. I want to get into one more story about affordable housing, and that's gonna be the Northwest ordinance that people forget about. NWO. The Northwest ordinance was in theory, let's stop gentrification. Okay, we want Logan Square, Pilson. We don't want people coming in there and creating, you know, getting rid of the people that lived there. All right. I'm gonna tell you a story. I had a person that lived, these are all true stories, lived on Maplewood, 2,400 block of Maplewood, right in the middle of that center. She was about 75, lost her husband, didn't have much savings, but bought a house 35 years ago for 50 grand. Now she wants to retire. She wants to move in with her family. And the only asset she has is her piece of property, her property. And at 11 o'clock at night last year, basically, when no one's paying attention, they passed this law. And it says, hey, from now on, if you're gonna tear a building down in these areas, you owe us$50,000. Okay. So we have incredibly high housing prices as it is, right? We have high material costs, we have high land cost, and we have no housing. Let's throw another$50,000 tax onto that. That sounds great, right? Who's paying that tax? Well, the ultimates are like, well, you know, the developer will pay the tax. Do you know the margins on development? It ain't a lot. Especially when you're building something that's a year out and you have no idea what tariffs are going to do, what the economy is gonna do. That is a massive gamble. A developer puts his money on the line for a year out, has no idea what'll happen within the year, has no guarantees on what will happen up or down. Let's say you do that. And then on top of it, we're like, well, now you're gonna incur a$50,000 loss just to tear the house down. Well, the person that's paying that$50,000 is gonna be the homeowner. And that's exactly what happened. Everybody's property in those areas dropped by$50,000. So you have a ton of people that have lived there their whole life, they have no savings. This is their retirement. They're gonna sell their home, maybe move back to wherever they're from, some different state, different country, move in with their, they're, you know, they're getting old, older, they need help, they need help. They have to get a nurse, they're gonna move in with their parents, I'm sorry, their kids, and they're gonna sell this piece of property, and that's gonna be their nest egg for the next 20 years, gonna pay for their medicine, this, that. And all we did was just rip that 50 grand away from them. You know, I sat there and when we did the comparables, I said, you know, if you sold this house a month ago, I could have got you 550. I said, but the best I can get you now is 475 to 480. She's like, well, why? I'm like, because they put this tax. It's a it's a$50,000 tax to tear down your home. And on top of it, you know, I, you know, I we also have restrictions on what we can build because there's a whole other slew of restrictions that they're putting. Aldermen are actually voting that you can't build by right. So each piece of property has a zoning code, R3, R4, R5, RM. There's a ton of them. And that tells you what you can do with that property. Dalderman said, screw you, we don't care what the laws are. We're gonna put a restriction over these areas that you can't do X, Y, and Z, even though you can build or should be able to build on your property by right. And that money came out of her pocket. And I'm sitting there talking to her kids who are older, my age, and their mom. And I said, listen, I said, this is the ridiculousness of it. I said, we're in an inventory, a bad economy, we don't have housing, we're being overtaxed, and on top of it, we don't have supply. And the aldermen at 11 p.m. last year turned around and passed this law thinking that they were doing the betterment of the people who are there. Now, the people that passed this law, are they in this situation? Are the people that pass these laws, these aldermen, are they in a situation that their house is their nest egg, is their 401k, is the way that they're going to continue to provide for themselves and provide for their family? No. That's why they voted for it. Right? The government is saying, we don't really care the situation that you're in. We think that this is best. And they're not in that situation. They're not in a situation where they need their house to pay for certain things. They're in a situation that they're like, hey, we don't want gentrification. And I get it. Why? Because that's what their voting base is saying. The people that are there that are vote for them. Because those people, when they sell and move, that's a vote that they lose. So let's screw everybody so that we can continue to get our voting base and keep our voters here. That's another thing that's going on with the housing, right? So overtaxation, affordable housing laws that don't work, retrofitting stuff that does not work, and then continuously downzoning areas as they get better. Think about that. Every area as it gets better gets downzoned. Why? We don't want anybody else moving there. They want their property values to go up. And as the values of the properties go up, they cut the alderman's checks. This is for you, this is for you, this is for the dinner table for your for your re-election, yada, yada, yada. It's all a cycle and it has to do with housing. But we have to get housing under control. We have to get our taxes under control, and we have to provide supply. We have to figure out how to get supply out there. I'm going to tell you my last thing, my last rant. Everybody wonders how we revitalize the city. I can fix it with one thing. You want to revitalize the city? Give tax breaks to companies that require the workers to come back into the city. Right? There's a tax break. Why don't I give you a$1 tax break? Now, obviously, it'd be more than one buck, but let's just use a dollar, right? I'm going to give you a dollar tax break to bring that to bring that guy back in, to bring that girl back in, to bring that worker back in. All of a sudden, that worker takes public transit. Public transit's dying. No one's on it, right? Starts funding public transit. Oh, then I'm going to grab a coffee and an egg sandwich on my way to work. Okay. There's a cook, there's a dishwasher, there's a retail space that's that has somebody in it that's not empty. And then there's a cashier. And then there is an owner. And then there is a waitress or waiter that provides the food if they have sit-down food. There's seven people that just made money from that egg sandwich and that coffee. Now that person hangs out at that office, goes and has lunch, gets their shoe shined, goes buys a shirt, stays downtown, sees a show, all of this. No, the city has an 11.75% sales tax. Every time that guy spends a dollar, that worker spends a dollar, the city's making almost 12 cents. You're telling me if I give a tax break of$1 per month, that I'm not going to recoup that in taxable income in revenue? Five over. Five over. The retail's filled. The city's vibrant. Restaurants open up. Everything else happens. Guys, we cannot tax people to the point that they just leave or quit. We have to provide incentives. And those incentives will then create more capital coming into the city. And capital, once again, makes capital. Now, when the city is vibrant and sales are going up, what happens? Banks are be like, hey, let's build in Chicago. We know we're not going to get screwed. The city's vibrant. There's people working downtown. There's no more units left. I can look up a two-bedroom, two-bath in River North, and I'll find a hundred units on the market. More downtown. As all that inventory gets sopped up and all those people are in there, all those tax revenues come. That's the way. And I'll leave you with one thought that I heard from BizNow, and I've it's literally like sometimes you just hear stuff and it just clicks. There's three ways a city survives. And I'm gonna leave you with this. Three ways a city survives. It taxes you. We're overtaxed, as per being the number one taxed place in America. You cut services. Well, that's all that Mayor Johnson's talking about right now. We gotta cut this, we gotta cut this, we gotta cut this.
SPEAKER_01:The third one, capital. Growth.
SPEAKER_00:If you have growth, you don't have to cut services and you don't have to raise taxes, but you have to make the city attractable for capital. And right now we're not. So how do we do that? Well, we have to have the right leadership and the right thought process, and we can't be upset that people are making money. Because people making money means everybody makes money because you have growth. You can say what you want about Florida or about other places, but when Florida is about to abolish property taxes and only have to pay once, and they don't have state income tax, and they got money flowing out of their coffers, proof's in the pudding. It's just data. And they have the data and we don't. So that's it. That's my single rant for today. Hopefully I made some things move in your head and you think of things, and and you realize when you're not being able to afford something, you're like, man, if there were 30 more homes on the market, everyone would have to fight prices down where I would afford something. Um, those are my thoughts on everything. So thanks so much. Have a great November. This will drop in a couple weeks, and we'll talk in December.