That’s why the homestead credit would only be payable to the resident. Residency is what matters here not the paper owner.
I won’t claim there aren’t potential loopholes in a casually described plan, but the one you brought up doesn’t apply without fraudulent claims of residency.
Currently, large corporate landlords are willing to let housing units sit empty vs letting market rates drop. A company with 500 units makes the same amount leasing 400 units at $1500/mo as they would leasing 470 units at $1300/mo and they have less overhead. The realpage software lets them coordinate with all the other corporate landlords without direct communication.
The reason I think this policy would help renters is by making vacant units significantly more expensive and pushing corporate property managers to actually compete rather than sit on vacancies.
I think I’d rather see this adressed on the property tax side with a homestead tax exemption. Let counties and municipalities significantly raise property tax rates then offer homestead tax rebates to the primary resident. Maybe even offer a monthly rebate to match rent/mortgage payments. Rent would go up, but the rebate should match the rent increase.
This would make empty units, short term rentals, and vacation home more expensive to hold on to compared to being pccupied by a long term resident. This would also let each region decide on the ratio of occupied vs unoccupied net property tax rates to dial in what works for them. A coastal community might have a much different equilibrium point than a suburb to a big city for example.
A lot of areas already have homestead exemptions for seniors and low income residents, so it doesn’t even require much in terms of new legal frameworks.
It disincentivizes speculative holding and buying up inventory to reduce supply without demonstrated demand. Large landlords are willing to sit on vacant inventory in order to keep market rates high. By penalizing holding units vacant, that should incentivise either setting more competitive rents, or selling/not buying excess inventory.
In markets where there is a true undersupply of inventory and there aren’t vacancies then, yes, this policy wouldn’t have much benefit.