I agree, it would reduce the amount of homes available for rental. However, the goal here is to get people to own the houses, not rent them. According to Google the average 2-bedroom apartment where I live (city of 150k appx.) goes for $1,522 dollars. That is more than the mortgage payment on my 24-year-old four-bedroom home in that same city. With the proper incentives and structured lending I see no reason why these same people couldn’t be paying mortgages instead of rent.
Forced divestitures of private property happens all the time, bank foreclosures, unpaid taxes, etc. it’s hardly a new concept. I’m afraid if there is not a hard line on the ownership then large corporations will find a way to weasel around it and end up owning all the property again.
As for taxes, anything too excessive will be deemed “cruel and unusual.” And, as a mega-corporation, if I can pay a million dollar or 100 million dollar a year “tax fine” and still make 2 billion dollars in profit, I’ll just work it into my expense sheet (and raise rental fees to cover it).
In order for this act to be effective, I think the rules for ownership need to be simple and few.