Put a hard stop to the purchasing of homes by corporations/businesses and people with no intention of living in them.
You should need proof of intention to live in the home within a reasonable amount of time after the purchase in order to make the sale. The flipping of homes for profit by those with cash and more money is a detriment to the market and the american dream for the rest of the population trying to get a foothold.
Rather than a hard stop, I think it would be a good idea to significantly increase taxes on real estate no one is actively living in, and use the proceeds to subsidize construction of new housing.
This seems to be the most reasonable. Disincentiivize multiple property ownership rather than outright ban it. The ones who can eat the cost will pay taxes and the rest will just bow out of the market.
But housing is a need and people will keep paying any price to not be homeless, this feels like it leads to massive corporations still owning all of them and paying large taxes they can eat short term and raise to massive prices of rent. Maybe they dump some stock but I’m just not sure it does much other than diversify smaller investors that used property for assets
this feels like it leads to massive corporations still owning all of them and paying large taxes
Then the taxes aren’t high enough. That’s an easy fix. It’s one of those times the state doesn’t want to optimise the rate for total tax earned but to make paying it for any length of time actually prohibitive. Make it so that they can’t possibly raise rents high enough to cover those taxes and they’ll understand quickly.
The other side of the equation is a bit harder, and that’s housing overstock: Companies will be sitting on housing they can’t rent out due to lack of demand for housing. One idea would be to allow them to lease homes out to municipalities for literally nothing but tax forgiveness and the municipalities can use that to house the left-over homeless, unemployed, etc. Call it a half write off. Oh those leases need sensible minimum durations, I’d say five years is a good start.
smaller investors that used property for assets
You can easily make smaller investors be hit significant less by it by scaling the tax to the number of vacant housing units. Own a second home you rent out and spend four months finding a renter you like? Fine, pay ten bucks. Do that to 1000 housing units? Pay 10000 bucks for each.
Yes, those kinds of rates are right-out financial violence. That’s the point: The state has to step in as the larger bully to keep the small ones in check to avert market failure.
Your argument falls flat once you remember that there is in fact plenty of homeless people and there will always be those who will choose not to pay irregardless of logic or desire of self preservation. And while yes, any privatization of housing isn’t really any good, but you don’t have to make it impossible for them to make money off of it. You just play their own logic against them and keep it just on the line where they will ultimately go for something else to profit off of other than housing as their returns and infinite growth will eventually lead them into microscopic margins so any variability becomes a threat to the bottom line.
Rather than a hard stop, I think it would be a good idea to significantly increase taxes on real estate no one is actively living in, and use the proceeds to subsidize construction of new housing.
An alternative is to replace property tax with a land tax. That way instead of penalizing people for building more housing, they are penalized for holding onto land that could be used to house more people (or whatever other use is in mind).
I disagree, because that would disincentivize housing. I think the price of housing is mostly just a function of how much of it is on the market. Wealth inequality is also a problem but should be addressed in other ways.
As an aside, the tax should also apply to commercial real estate so there is an incentive to convert offices to apartments.
You’re essentially talking about decommodification of housing, which is the only correct answer. It is necessarily impossible for a house to be both affordable and a good investment, and the current status quo means that housing will be used as an investment. Whatever mechanism used to fix the housing affordability problem will require that housing no longer be subject to commodity market forces.
The value of a house should be in reduction of costs, not increase in real value.
When you rent, you pay for maintenance of your residence, some amount of furnishings, and the risk tht property owner takes in renting to you (i.e. the likelihood that you’ll destroy the property, fail to pay, etc).
When you own, you take that risk on yourself. You can choose to delay, DIY, or preempt repairs. You can choose what level of furnishings you have, and you are responsible for any loans or taxes due on the property. You don’t need to worry about unplanned vacancies.
Housing should keep pace with demand so property values stay roughly consistent with normal inflation. Unfortunately, cities tend to grow, making existing property more valuable.
When you rent, you also pay for the flexibility of being able to pick up and move in a short while if you get a new opportunity somewhere else, or just want to move for whatever reason.
Some people rent because they don’t want to worry about repairs, or mowing lawns, or any of that stuff.
They’d rather spend $3,500 taking a nice vacation than on a new furnace.
When you rent, you still pay for that $3500 furnace, you just pay for it in monthly installments through your rent instead of all at once.
You can accomplish the same thing with home ownership by using sinking funds. Basically, if you expect that furnace to last 20 years and cost $3500, you’d set aside ~$15/month, assuming your furnace is new. If you expect repairs in that time, set aside enough to cover that cost as well. If you do that for enough of your major repairs (roof, major appliances, driveway, etc), you should always have enough in the fund to meet any house related emergency, assuming your estimates are accurate enough on average. I do this in my budget by using online estimates for expected lifetime and cost to replace, and I do my best to make things last longer than that estimate. I do the same for cars and other large expenses so I’m always prepared.
That’s what landlords do, and homeowners can do it too. Budget for repairs just like you’d budget for a vacation.
Your first point is more important though. Selling a house is expensive and time consuming, so it absolutely makes more sense to rent if you expect to need to move with short notice. You’ll pay a premium for that convenience, and you’ll also not have to worry about repairs. For some people, renting is less expensive on net vs owning even if they don’t need to move quickly, e.g. if they know they’ll overspend on renovations and repairs. There’s absolutely an argument to both, I’m just pointing out that the value in a house isn’t in the appreciation imo, it’s in potential cost savings by taking ownership of repairs, vacancy, etc.
The problem is not that the furnace is $15/mo, it’s that it requires having $3500 all at one time. Newer furnaces have circuit boards on them and seem to require more repairs and maintenance. Everything does really. Appliances, water heaters, etc. There’s lots of expenses to home ownership and expenses that happen suddenly instead of being able to plan neatly for them.
Right, and those can be anticipated and mitigated. Options:
home warranty - essentially forces you to save for larger expenses
be pessimistic about expected lifetimes - i.e. only assume your appliances will live while they’re under warranty (most can last more than double that with proper maintenance)
forego most or all other savings until you can pay for the highest ticket item in cash - it’s extremely unlikely that everything will fail at once
If something truly out of the blue comes up, you’re usually in appliance warranty or home owners insurance claim territory. The vast majority of the time, “unexpected” expenses could’ve been planned for, but the individual didn’t do their due diligence. A 20 year old furnace going out isn’t an emergency, that’s its expected lifetime (and with maintenance, a high quality furnace can last double that).
Owning a home is expensive, and so is renting. If you’re paying more owning a home on average vs renting for the same size of place (after, say, 6 years or so), you’re doing something seriously wrong.
Again, not everyone who owns a home saves up for those things. Case in point, one of my friends budgets for an annual furnace tuneup at the end of summer. Well, they discovered that the furnace is dead and won’t start up once it gets cold. So her plan is to work a second job for a month to be able to afford getting a new furnace since it’s close to winter.
If she was renting, the owner would simply replace the furnace and she wouldn’t have to worry about it.
Does she budget for other longer term expenses, like car replacement and repairs, retirement, or college for kids (assuming she has kids)? If not, this should be a wakeup call that she needs to get her finances in order, because working a second job shouldn’t be the solution to every periodic expense.
I don’t know where you live, but at least in my area, I had to finish a new homeowner packet to get my mortgage, which laid out common expenses. AFAIK, that’s a pretty common thing because banks don’t want you to default due to an unexpected repair cost.
But maybe renting is better for her if she is unable or unwilling to plan ahead. My point is that, in most cases, owning ends up being cheaper than renting for the same space.
How about expropriation of these homes instead of just a half assed “can we put a pause on capitalism guys?” You realize what the problem is. No more half measures, Walter
ATL had a pretty good program at one point. If you made $60k, you could buy a $250k house with the requirement that you would be the primary resident for the first year.
What’s even better is that the comparables in the area were all $450k, so 3 years later, all of the homes got valued around $500-600k.
331.9 million (2021) US Population / ~142 million housing units in the United States (2021) = ~2.34 people average needed per dwelling to fully house everyone.
According to Statista: " The average American household consisted of 2.5 people in 2022. "
If people did not need vacation homes, and investment property… We appear to have enough housing for everyone already.
I’m working under the assumption hotels/motels are not included… there should be plenty of those to house people on vacation, and leaves plenty of room for the ultra wealthy to still have their vacation homes.
Put a hard stop to the purchasing of homes by corporations/businesses and people with no intention of living in them.
You should need proof of intention to live in the home within a reasonable amount of time after the purchase in order to make the sale. The flipping of homes for profit by those with cash and more money is a detriment to the market and the american dream for the rest of the population trying to get a foothold.
Rather than a hard stop, I think it would be a good idea to significantly increase taxes on real estate no one is actively living in, and use the proceeds to subsidize construction of new housing.
This seems to be the most reasonable. Disincentiivize multiple property ownership rather than outright ban it. The ones who can eat the cost will pay taxes and the rest will just bow out of the market.
But housing is a need and people will keep paying any price to not be homeless, this feels like it leads to massive corporations still owning all of them and paying large taxes they can eat short term and raise to massive prices of rent. Maybe they dump some stock but I’m just not sure it does much other than diversify smaller investors that used property for assets
Then the taxes aren’t high enough. That’s an easy fix. It’s one of those times the state doesn’t want to optimise the rate for total tax earned but to make paying it for any length of time actually prohibitive. Make it so that they can’t possibly raise rents high enough to cover those taxes and they’ll understand quickly.
The other side of the equation is a bit harder, and that’s housing overstock: Companies will be sitting on housing they can’t rent out due to lack of demand for housing. One idea would be to allow them to lease homes out to municipalities for literally nothing but tax forgiveness and the municipalities can use that to house the left-over homeless, unemployed, etc. Call it a half write off. Oh those leases need sensible minimum durations, I’d say five years is a good start.
You can easily make smaller investors be hit significant less by it by scaling the tax to the number of vacant housing units. Own a second home you rent out and spend four months finding a renter you like? Fine, pay ten bucks. Do that to 1000 housing units? Pay 10000 bucks for each.
Yes, those kinds of rates are right-out financial violence. That’s the point: The state has to step in as the larger bully to keep the small ones in check to avert market failure.
Your argument falls flat once you remember that there is in fact plenty of homeless people and there will always be those who will choose not to pay irregardless of logic or desire of self preservation. And while yes, any privatization of housing isn’t really any good, but you don’t have to make it impossible for them to make money off of it. You just play their own logic against them and keep it just on the line where they will ultimately go for something else to profit off of other than housing as their returns and infinite growth will eventually lead them into microscopic margins so any variability becomes a threat to the bottom line.
An alternative is to replace property tax with a land tax. That way instead of penalizing people for building more housing, they are penalized for holding onto land that could be used to house more people (or whatever other use is in mind).
Nah tax the fuck outta landlords
There should also be taxes on rental properties beyond the first to prevent the “hoard and rent” cycle
I disagree, because that would disincentivize housing. I think the price of housing is mostly just a function of how much of it is on the market. Wealth inequality is also a problem but should be addressed in other ways.
As an aside, the tax should also apply to commercial real estate so there is an incentive to convert offices to apartments.
take the houses, take the landlord’s wealth they scalped, then fix it.
Landlords don’t “scalp wealth”. The income they earn is from working their job. Just like anyone else who is self employed.
removed working how? sitting there and collecting passive income? Are you fucking stupid?
How about being civil instead of name calling?
No
You’re essentially talking about decommodification of housing, which is the only correct answer. It is necessarily impossible for a house to be both affordable and a good investment, and the current status quo means that housing will be used as an investment. Whatever mechanism used to fix the housing affordability problem will require that housing no longer be subject to commodity market forces.
The value of a house should be in reduction of costs, not increase in real value.
When you rent, you pay for maintenance of your residence, some amount of furnishings, and the risk tht property owner takes in renting to you (i.e. the likelihood that you’ll destroy the property, fail to pay, etc).
When you own, you take that risk on yourself. You can choose to delay, DIY, or preempt repairs. You can choose what level of furnishings you have, and you are responsible for any loans or taxes due on the property. You don’t need to worry about unplanned vacancies.
Housing should keep pace with demand so property values stay roughly consistent with normal inflation. Unfortunately, cities tend to grow, making existing property more valuable.
When you rent, you also pay for the flexibility of being able to pick up and move in a short while if you get a new opportunity somewhere else, or just want to move for whatever reason.
Some people rent because they don’t want to worry about repairs, or mowing lawns, or any of that stuff.
They’d rather spend $3,500 taking a nice vacation than on a new furnace.
When you rent, you still pay for that $3500 furnace, you just pay for it in monthly installments through your rent instead of all at once.
You can accomplish the same thing with home ownership by using sinking funds. Basically, if you expect that furnace to last 20 years and cost $3500, you’d set aside ~$15/month, assuming your furnace is new. If you expect repairs in that time, set aside enough to cover that cost as well. If you do that for enough of your major repairs (roof, major appliances, driveway, etc), you should always have enough in the fund to meet any house related emergency, assuming your estimates are accurate enough on average. I do this in my budget by using online estimates for expected lifetime and cost to replace, and I do my best to make things last longer than that estimate. I do the same for cars and other large expenses so I’m always prepared.
That’s what landlords do, and homeowners can do it too. Budget for repairs just like you’d budget for a vacation.
Your first point is more important though. Selling a house is expensive and time consuming, so it absolutely makes more sense to rent if you expect to need to move with short notice. You’ll pay a premium for that convenience, and you’ll also not have to worry about repairs. For some people, renting is less expensive on net vs owning even if they don’t need to move quickly, e.g. if they know they’ll overspend on renovations and repairs. There’s absolutely an argument to both, I’m just pointing out that the value in a house isn’t in the appreciation imo, it’s in potential cost savings by taking ownership of repairs, vacancy, etc.
The problem is not that the furnace is $15/mo, it’s that it requires having $3500 all at one time. Newer furnaces have circuit boards on them and seem to require more repairs and maintenance. Everything does really. Appliances, water heaters, etc. There’s lots of expenses to home ownership and expenses that happen suddenly instead of being able to plan neatly for them.
Right, and those can be anticipated and mitigated. Options:
If something truly out of the blue comes up, you’re usually in appliance warranty or home owners insurance claim territory. The vast majority of the time, “unexpected” expenses could’ve been planned for, but the individual didn’t do their due diligence. A 20 year old furnace going out isn’t an emergency, that’s its expected lifetime (and with maintenance, a high quality furnace can last double that).
Owning a home is expensive, and so is renting. If you’re paying more owning a home on average vs renting for the same size of place (after, say, 6 years or so), you’re doing something seriously wrong.
Again, not everyone who owns a home saves up for those things. Case in point, one of my friends budgets for an annual furnace tuneup at the end of summer. Well, they discovered that the furnace is dead and won’t start up once it gets cold. So her plan is to work a second job for a month to be able to afford getting a new furnace since it’s close to winter.
If she was renting, the owner would simply replace the furnace and she wouldn’t have to worry about it.
Does she budget for other longer term expenses, like car replacement and repairs, retirement, or college for kids (assuming she has kids)? If not, this should be a wakeup call that she needs to get her finances in order, because working a second job shouldn’t be the solution to every periodic expense.
I don’t know where you live, but at least in my area, I had to finish a new homeowner packet to get my mortgage, which laid out common expenses. AFAIK, that’s a pretty common thing because banks don’t want you to default due to an unexpected repair cost.
But maybe renting is better for her if she is unable or unwilling to plan ahead. My point is that, in most cases, owning ends up being cheaper than renting for the same space.
How about expropriation of these homes instead of just a half assed “can we put a pause on capitalism guys?” You realize what the problem is. No more half measures, Walter
First step is seizing the ones they already bought, at gunpoint if they resist
As for “the market and the american dream”, lol. lmao, even
Death to America
well that doesn’t sound like free market capitalism!
its maddening there are plenty of homes out there completely empty
ATL had a pretty good program at one point. If you made $60k, you could buy a $250k house with the requirement that you would be the primary resident for the first year.
What’s even better is that the comparables in the area were all $450k, so 3 years later, all of the homes got valued around $500-600k.
331.9 million (2021) US Population / ~142 million housing units in the United States (2021) = ~2.34 people average needed per dwelling to fully house everyone.
According to Statista: " The average American household consisted of 2.5 people in 2022. "
If people did not need vacation homes, and investment property… We appear to have enough housing for everyone already.
I’m working under the assumption hotels/motels are not included… there should be plenty of those to house people on vacation, and leaves plenty of room for the ultra wealthy to still have their vacation homes.
Sources: Statista, US Census, Google