Posted in a Canadian channel before, because I am Canadian:
The housing crisis arises out of one problem, and one problem only:
Housing as an investment.
That’s not to say foreigners are to blame - at less than 2% of the market, they don’t have any real impact. British Columbia’s laws against foreign home ownership is nothing more than a red herring, a bullshit move designed to flame racism and bigotry. Yes, some of them are just looking to build anchors in a prosperous first-world country, but most are honest buyers.
A better move has been the “speculation tax”. By taxing more heavily any home that remains empty, it encourages property holders to actually rent these units out, instead of holding out for people desperate enough to pay their nosebleed-high rents.
But all of this misses the real mark: housing used purely as investment.
Now, to be absolutely clear, I am not talking about landlords who have a “mortgage helper” suite, or who have held on to a home or two that they previously lived in. These are typically the good landlords that we need - those with just two or three rental units, and that aren’t landlording as a business, just as a small top-up to their day job or as an extra plump-up to the retirement funds they are living off of. By having many thousands of separate landlords instead of one monolith, healthy competition is preserved.
No, there are two types of “investors” that I would directly target:
- Flippers
- Landlords-as-a-business.
1) Flippers
The first group, flippers, also come in two distinct types:
- Those that buy up homes “on spec” before ground has even been turned, and then re-sell those same homes for much more than they bought shortly before these homes are completed. Sometimes for twice as much as they paid.
- Those that buy up an older, tired home, slap on a coat of paint, spackle over holes in the walls, paper over the major flaws in hopes that inspectors don’t catch them, and shove in an ultra-cheap but shiny Ikea kitchen that will barely last a decade, then re-sell it for much more than they paid for it.
Both of these groups have contributed to the massive rise in housing purchase prices over the last thirty years. For a family that could afford a 3Bdrm home in 2000, their wages have only increased by half again, while home values have gone up by five times by 2023.
And this all comes down to speculation driving up the cost of homes.
So how do we combat this? Simple: to make it more attractive for owner-occupiers to buy a home than investors.
A family lives in a home that they own for an average of 8 years. Some less, most a lot more. We start by taxing any home sale at 100% for any owner who hasn’t lived in said home as their primary residence for at least two years (730 contiguous days). We then do a straight line depreciation from the end of the second year down to 0% taxation at the end of the eighth year. Or maybe we be kind and use a sigmoid curve to tax the last two years very minimally.
Exceptions can exist, of course, for those who have been widowed, or deployed overseas, or in the RCMP and deployed elsewhere in Canada, or where the house has been ordered to be sold by the court for divorce proceedings, and so forth. But simple bankruptcy would not be eligible, because it would be abused as a loophole.
But the point here is that homes will then become available to those working-class people who have been desperate to get off of the rental merry-go-round, but who have been unable to because home prices have been rising much faster than their down payment ever could.
This tax would absolutely cut investors off at the knees. Flippers would have to live in a home much, much longer, and spec flippers would be put entirely out of business, because they can’t even live in that house until it is fully completed in the first place.
2) Landlords-as-a-business
The second group is much simpler. It involves anyone who has ever bought a home purely to rent it back out, seeking to become a parasite on the backs of working-class Canadians in order to generate a labour-free revenue stream that would replace their day job. Some of these are individuals, but some of these are also businesses. To which there would be two simple laws created:
- It would become illegal for any business to hold any residential property whatsoever that was in a legally habitable state. This wouldn’t prevent businesses from building homes, but it would prevent a business from buying up entire neighbourhoods just to monopolize that area and jack up the rent to the maximum that the market could bear.
- Any individual owning more than 5 (or so) rental units (not just homes!) would be re-classified as operating as a business, and therefore become ineligible to own any of them - they would have to immediately sell all of them.
As for № 2, a lot of loopholes can exist that a sharp reader would immediately identify. So we close them, too.
- Children under 24 “operate as a business” automatically with any rental unit. They are allowed ZERO. Because who TF under the age of 25 is wealthy enough to own rental units? No-one, unless these units were “gifted” to them from their parents, in an attempt to skirt the law. So that is one loophole closed.
- Additional immediate family members are reduced by half in the number of rental units they can own. So if a husband has the (arbitrary, for the sake of argument) maximum limit of five, the wife can only have two herself. Any other family member who wants to own a rental unit, and who does not live in the same household, must provide full disclosure to where their money is coming from, and demonstrate that it is not coming from other family members who already own rental units.
By severely constraining the number of investors in the market, more housing becomes available to those who actually want to stop being renters. Actual working-class people can exit the rental market, reducing demand for rental units, and therefore reducing rental prices. These lower rental prices then make landlording less attractive, reducing the investor demand for homes and reducing bidding wars by deep-pocketed investors, eventually reducing overall home values for those who actually want to buy a home to live in it.
Plus, landlords will also become aware of the tax laid out in the first section that targets flippers. If they own rental units that they have never lived in as their primary residence, they will also be unable to sell these units for anything other than a steep loss. They will then try to exit the market before such a tax comes into effect, flooding the market with homes and causing prices to crash. They know that they are staring down two massive problems:
Being stuck with a high-cost asset (purchase price) that only produces a low-revenue stream because renters have exited the market by buying affordable homes, allowing plenty of stock that is pincered by the spec tax that heavily taxes empty rental units, thereby lowering rental prices well beneath the cost of the mortgage on the unit.
By putting these two tools into effect at the same time, we force a massive exodus of landlords out of the marketplace, crashing home values to where they become affordable to working-class people, thereby massively draining the numbers of renters looking for places to rent. Those places still being rented out - by owners who have previously lived in them, or by investors who couldn’t sell in time - would significantly outnumber renters looking for a place to rent, thereby crashing rental prices as renters could then dictate rents by being able to walk away from unattractive units or abusive landlords.
Full disclosure: I own, I don’t rent. But I have vanishingly little sympathy for greed-obsessed parasites that suck the future out of hard-working Canadians who must pay 60% or more of their wages for shitbox rentals to abusive landlords in today’s marketplace. Most people (and pretty much anyone under the age of 30) who don’t already own no longer have any hope of ever owning a house, as their ability to build a down payment shrinks every year, while home values accelerate into the stratosphere.
Creating massive penalties equal to the whole cost of a house for anyone that sells after less than 6-8 years would have devastating unintended consequences. It might make flipping impractical, but it would also hurt a lot of people who find themselves in a position where they need to sell, and would increase the risks associated with buying a house for lower income buyers.
It would help if you targeted the profit from the sale instead of the whole price. Flipping is about buying low, minimizing the cost of improvements, and then selling for a massively inflated amount. Without that profit it’s not worth it. For a normal person, being able to make money on the deal is nice, but at least recouping your costs can keep you economically stable and allow you to move on with your life.
I also think that you would want to combine this with some plan for helping low income buyers with the restoration of neglected properties that would normally be snatched up by flippers.
I also think the arbitrary age restriction on owning a rental property needs an exemption for inherited properties if nothing else. A 20ish year old who inherits a home or rental property when their parent(s) die is not abusing a loophole, and immediately hitting them with additional legal problems and forcing them to sell a house that has a tenant already in there is just unnecessary chaos for everyone involved.
I’m also curious how large apartment complexes fit into this plan. Are they also banned? Do you just need an owner to occupy a (potentially much nicer) apartment in the building? If you can still operate a huge apartment complex, I would expect the market to shift heavily towards those. If you can’t well, that raises it’s own issues around urban housing and population density.
In Switzerland we have a tax when selling a house on the value it gained since you bought it. So if you buy a house for price X and you sell it for more than that, you will be taxed on the price difference. Even if the price difference is just because of market fluctuations.
This is probably a better solution against flippers, since only those making money by increasing house values are taxed. The tax can then be made more or less aggressive as needed.
Edit: here are some more explanations about how this tax works https://www.ch.ch/en/housing/homeownership/taxation-of-real-estate#are-you-planning-to-sell-your-house-or-apartment
That’s a quality rant, I love it! The other guy had a point about zoning to allow greater density, but I think that’s a separate but related issue.
Obviously these will never come to pass while your leaders are all landlords, though
I can’t find the video, but the YouTube channel Oh the Urbanity! Did a pretty well explanation to why housing is so costly on Canada and the main problem is actually zoning laws. Like in 99% in Canada you can’t built anything but single family detached houses.
Love this write up! Thank you for posting, I really like your ideas. Out of curiosity how would apartment buildings work in your plan. There are many cities where you probably don’t want to encourage single family homes to reduce urban sprawl. How would you encourage high density housing in your plan?
Apartments can either be owned by families that upgraded to a house, and are now renting it out, or it can go full social housing where it follows the same model as Vienna, for example.
You need administration to manage an apartment or any physically combined housing, but nothing says that the building itself or the underlying land needs to be owned by a corporation. In fact, true social housing is “owned” by the people, the rent you pay is just for upkeep and to pay off a very long term cost-of-construction bill. Some families in Vienna’s social housing pay less than 20% of their income on rent. You get in young enough, and you’re paying a pittance by the time you retire.
Strong public housing would put most of the ratfuck kinds of landlords out of business by itself, if an affordable non-profit apartment is basically available to anyone who wants one, the private companies jacking up prices for pure profit now have to compete with that, and we solve the inelastic demand issue
I did not read all of this yet. But I always agreed with you on that housing as an investment was the crux of the problem, I just never knew exactly how to tackle it. Your write-up is great, and even if there are many issues that could arise from some of the implementation ideas, it’s an amazing beginning to a conversation we should have been having for at least decades.
Thank you very much! I will save this comment to come back to often.
This would get messy with inheritances. So if you own and a family member passes away, you’d have to either move into that home for two years or it would be worthless to sell? That’s going to create some perverse incentives regarding old folks and housing.
Related to why someone under 25 might own a rental unit.
Also, would this apply to non residential rental properties?
This would get messy with inheritances.
So make this an exception, on the condition that the child can be classified as an adult by the courts.
And if it’s someone under 25, there is a high likelihood that they’re still living at home and have already occupied the home for some time already. The passing of the parents would have triggered an insurance payout on the home (which is standard in Canada) so there wouldn’t be any kind of mortgage to continue paying, only property taxes. Remaining in the house would be achievable even with a minimum-wage job.
Also, would this apply to non residential rental properties?
My proposal targets only residential properties. Why would it have any effect on non-residential rentals? The entire purpose of that proposal is to deal with parasitism in the rental market, not anything else.
The housing crisis arises out of one problem, and one problem only:
Housing as an investment.
My city has a rental vacancy rate of <4%, and a homeowner vacancy rate of <1%. Flippers leave a house empty while under the process of flipping it, and that’s not what the numbers show. Landlords do increase the cost compared to ownership (they have to cover all normal costs of ownership, plus have profit for themselves), but they don’t reduce the number of shelters being occupied. Not when vacancy rates are this low.
In other words, my particular city may have costs driven up by flippers and landlords, but the number of dwelling units would be short even without them. Getting rid of them would be an insufficient solution, even if there are some benefits on costs. It does not address the problem that we need more dwelling units.
Great ideas. Too bad our politicians don’t listen to us.
Housing units, July 1, 2022, (V2022) USA 143,786,655 Owner-occupied housing unit rate, 2018-2022 64.8% If only 2% is foreign owned that is 2,875,733. Which is a hell of a lot of units
I’m okay with house flippers because they’ll buy undervalued run down houses nobody wants and turn them into desirable homes.
You can’t love there during the work and it’s a lot like recycling.
I’m not a fan of the ones who strip the sole out of a perfectly good home and do what you mentioned.
I’m okay with house flippers because they’ll buy undervalued run down houses nobody wants and turn them into desirable homes.
House flippers are arguably responsible for a housing-quality crisis. Flippers often fewer lower code requirements than new builders. You end up with a lot of houses with nothing but cosmetic remediation and fairly substantial issues otherwise.
I don’t want to paint with too broad a brush, but I think those are still the shitty flippers, but maybe the flippers I’m imagining don’t exist in appreciable number.
The problem is the lack of business-reason to spend money on things that do not raise the property value. Unfortunately “fixing things” usually carries a negative value return.
The common things flippers do (and I know this from some friends who did real-estate for flippers) is buy houses that mostly need the most efficient changes - new tile, paint, etc, with minimal inexpensive fixes to make the house saleable. And honestly, that’s obvious when you say it. The extension of that is that if you can cover up an issue or the issue is not outside margins of being saleable (old septic, safe-but-near-EOL electrical, less ideal insulation, intentionally avoiding discovering asbestos where it probably exists, etc), you should.
Then, depending on local laws, flippers have more limited disclosure requirements than builders. Which means anything that isn’t “gross negligence” that cannot show up on a home inspection… you. just. don’t. do.
Here’s an interesting article on the risk.
Thanks, that’s interesting and makes sense
No person should be allowed to own more residential property than they’re realistically need for living.
Do you allow couples to own two houses then? How do you prevent two people living together from not owning a second house to rent?
Also, you’d be surprised just how little a person needs to live in lol.
I don’t think we need to make this literally true - we can put in a lot of wiggle room, because we just need to restrict doing this at scale
Say, no more than 2 homes per household, 1 extra for each additional adult. You want a vacation house, or a place near work? Fine. You want to buy another house and take your time moving? Fine. You want both? Make some compromises.
Or we could make the limit 5 per household - that would be excessive, but if they couldn’t rent them out it would still decomodify housing, because it’s people buying homes at scale that really is killing us
From there, you’d crack down locally - if you want to live in the boonies, I don’t care if you have 5 acres. If you live in a city with a housing shortage, maybe you only get a certain square footage per person, maybe certain areas are primary residence only, or however you want to slice it
A co-op is another form of corporation. Dense, multi-family structures should be done that way.
What we don’t want is for housing to be a speculative investment. Remove the profit motive of holding a house that’s empty and reselling.
Damn. Someone that actually understands how things work and isn’t just painting absolutes across the board.
Up until very recently most housing in Finland was co-ops, and it’s still extremely common although many new developments are built and owned by corporations which then rent them out.
I live and own shares in a new housing co-op (proportional to the size of my apartment), and all of us together own and run the building and we’re renting the property from the city (although you can buy your share of that property off from the city if you don’t want to pay that rent.) It’s not a perfect system by any means but it’s better than corporations owning everything; ideally the people who live in a building are the ones who decide how it’s run, but of course that’s sort of gone out the window too with rich people just buying properties speculatively and to rent them out. If enough of the shareholders in a building are rent-seekers, upkeep of the building is going to go way down because they don’t live there themselves and don’t give a shit about whether it’s a nice place to live in, they care about making a profit.
Landownership is wrong all together.
If you think about it, it is completely absurd, why anyone assumes the right to ‘own’ a piece of land. Or even more land than the other guy. Someone must have been the person to first come up with the idea of ownership, but it is and was never based on anything other than an idea, and we should question it.
After all inheritance of landownership is a major cornerstone of our unjust and exploitative society.
Every generation, people want to try new things and it’s nice. But landownership can and has been and good thing in a way that just going back to “anarchy” wouldn’t work. E.g. creation of ghettos, who gets to farm the best land, etc.
So then the suggestions are that the land are owned and “managed” by the state apparatus. Now we have a few famines in history to show us how gaining favor in a political system is not the best way to manage the land.
I’m open to better suggestions but just shitting on land ownership seems easy and unproductive.
If someone owns a house, they kinda have to own at the very least some land around it. I just don’t really see any other way for that to work. Would be interesting to hear how that could work otherwise.
This isn’t something I know a whole lot about, because I don’t believe in the abolition of private property on an individual level, but it’s my understanding the crunchy types would ask:
What makes you think they have to own the land around it? There are plenty of home owners right now who don’t have yards.
I think he means more like an arms length or enough to walk around it. Not a full on yard.
This is really going to blow some suburbanite heads right off, apparently, but a lot of people live in duplexes too.
Those still exist? It’s been a long time since I’ve seen one, in the wild.
There’s a thing called leasehold whereby you own the building and lease the land usually for 99 years after which it returns to the freeholder. It’s one of the reasons that the US embassy in London moved from Mayfair to Nine Elms. It was the only US embassy in the world that the US government didn’t own, the freehold belongs to the Grosvenor family (i.e. Lord Grosvenor). When the US tried to buy the freehold the Grosvenor family refused but agreed to a 999 year lease in exchange for the return of 12000 acres of Florida that was confiscated from them after the Revolutionary War - yes, they’ve been landowners for a very long time! I think the US made sure to buy the freehold of the new site at Nine Elms (they sold the remainder of the 999 year lease in Mayfair for an undisclosed sum) 😀
Ah okay so private land ownership but all it takes is the slightest bit of corruption to ‘lease’ a plot of land for free, for essentially forever. Because that’s what 999 years essentially is.
We already have these systems with Water tables, and we can already see the problems.
Saudi Arabia is running the Arizona water tables dry because some shit agreed to ‘lease’ them unlimited water usage. They did this for the price of less than a smart phone in today’s dollars.
I want this to be fixed by not allowing non citizens to own american soil. It doesnt make sense to me to allow non us citizens to buy up land in america.
Like why cant the Saudis just buy hay from arizonans this transfering monies into local economies?
That will just make middle-man agreements.
You can rent the land too. It’s cheaper in the short term, more expensive in the long term.
Now we have a few famines in history to show us how gaining favor in a political system is not the best way to manage the land.
Doesn’t that also mean The Irish famine shows private land ownership isn’t the best way to manage land?
The potato famine was caused by a new type of blight being brought from the Americas back to Europe.
I don’t see how being beaten by a novel disease has anything to do with private land ownership.
The blight affected all of Europe, yet only Ireland had severe famine because while the French government bought food for their citizens, the English government publicly declared the invisible hand of the free market would fix the famine.
Similarly the Ukraine famine was crop failure due to bad weather conditions that affected all of Eastern Europe. The crop failure wasn’t caused by the Soviets. Yet only Ukrainians died because the Soviets shipped Ukrainian food to Moscow in the same way Irish died because of free markets shipping Irish food to London. (Yes, Ireland was still a net exporter of food during the famine.)
When natural disasters occured it’s, “Millions died because of communism.” Yet when millions die under the free market it’s only the natural disaster and not capitalism.
They grew enough potatoes to feed the population in spite of the blight losses. However said taters fetched a higher price abroad. So fuck the poor, I guess.
Yeah ok, I didn’t consider that.
Hard to argue with that.
Also they would have had a higher diversity of crops if not for landlords. Landlords were extorting farmers and the only way the farmers could pay the bills was with the vegetable that had the highest margin. Farmers were forced to switch from other crops to growing potatoes by their landlords.
Define for the class what you think anarchy means, and, wait one minute, you think ghettos are created by people not recognizing private land ownership?
Anarchy in 2 words, no state. It’s mostly a thing in history in opposition to something else.
Don’t be silly, I know why ghettos are created. My point was more towards the organization of urbanization through land ownership can help.
Now what do you propose we implement instead?
There’s quite a lot of thought missing from your definition of anarchy, including, ya know, all of the ideas on how to make that work, and the assumption by most that it wouldn’t be an immediate process, and for someone that knows how ghettos are created, you sure used it as a criticism of an idea that would make them literally impossible, while doubling down on insisting that the thing creating ghettos can solve the ghettos if you… Do it more, and harder?
I don’t actually believe in the dissolution of private property, at least in regards to individual land ownership, up to a certain point. I just take issue with people stating their opinions as facts, especially when they’re just flat out wrong.
all of the ideas on how to make that work
Tbf, that seems like it would depend on the flavor of anarchism.
Which is rather part of the problem, as a lot of modern anarchists don’t believe in the dissolution of the state, at least as a deliberate policy, thus the idea that Marxists and anarchists are ultimately working towards the same goal (communism) and disagreeing on the methods to achieve it.
Yeah i was referring to the dissolution of property rights when referring to anarchy. It was more colloquial than the actual system. Yes I didn’t copy the wiki for anarchy because it was irrelevant.
Not sure where you took the opinion as facts thing but okay…
I’m pretty sure the Native Americans didn’t believe in land ownership, at least not individual land ownership, more of a communal version, and it worked out well for them. They had huge societies, vast trade networks, and were able to feed themselves fine. It requires a different, non-capitalist, non-Western mindset, but it can work.
Their huge societies in no way are comparable to the population we have today.
Neither was the Western population at the time, but it scaled up fine. There’s nothing saying alternative systems of land ownership can’t scale up either. The only reason we went with the current one is because it benefited the people who killed everyone else.
Why is it that their population hasn’t grown in the same way as people with other views on land ownership, do you think? Is it because the other people were the good guys in your imagination?
Holy shit I didn’t expect such a quality comment in this discussion.
I would argue that corporations shouldn’t be able to own residential land, and regular people shouldn’t own more than two land pieces.
That’s all well and good but I don’t want you living in my garden.
People like the idea of the stability ownership offers. You can’t be kicked out of your house or off your land you own because your income dropped out lost a job. How would you suggest this stability is maintained?
It goes back to when good agricultural land discovered to be so ridiculously effective at feeding people.
Not the beginning of wealth, but certainly one of the oldest still used store of wealth.
So much has been fucked up by discovering agriculture, it was also the beginning of institutional slavery.
You’re not wrong but surely you don’t mean to say that mankind should never have discovered agriculture, right? At that point we may as well say that gaining sentience fucked everything up because it was the beginning of wilfully hurting others despite having the capacity for empathy (aka doing evil things).
but surely you don’t mean to say that mankind should never have discovered agriculture, right?
RETURN TO MONKE
No I’m serious, and I understand you mean well but I can’t have this discussion meaningfully with you without writing 8 paragraphs of context.
There’s a lot of what Pratchett called ‘lies to children’ when it comes to non-university anthropology, things we learned in school that were kind of outdated already and gross oversimplifications.
We were told that agriculture allowed the free time to specialize and was the beginning of culture but the truth is that all that hunter-gatherer man needed to hunt to feed himself and 3 other people was about 6 hours of actual work a week. And specialization already existed with stone knapping and pottery.
There’s a lot more to it but I don’t really have the patience to keep writing this.
Well, you did a good job condensing where you were coming from in two paragraphs. Enough to make me realise that I mistook your original meaning completely. I hadn’t heard the 6 hours of work a week number before. In fact, I’ve never really questioned the logic I was taught with regards to agriculture being the start of civilisation due to freeing up hands and allowing people to settle down, because hunter gatherers would have to roam around at least a little to follow herds or seasonal effects on available forage. That understanding was based on what I’ve learned in history 101 at high school though.
I started out a bit argumentative because I read your comment as an overly dramatic lamentation that I took to mean something like: “people are so bad I wish we weren’t born/evolved”. Thanks for taking the time to kindly explain. I’m always interested in having a possible blind spot or internalised assumption revealed and to reassess entrenched beliefs.
Their previous comment read the same way to me, too; just so you know it’s not only you that thought that’s what they meant.
Sometimes when I misinterpret something, I wonder if I’m the only one, or if others would’ve interpreted it similarly, so I can take that information and have a better idea of how to move forward and learn from the situation. So, I dunno, just thought I’d say something just in case you’re similar ¯\_(ツ)_/¯
One other thing to point out is that agriculture allowed for large mobile armies.
For hunter gatherers it wasn’t easy to stockpile enough long term storage portable food to take to war, nor could you predict periods of bounty (which is why so many ancient cultures had prohibitions to making war during winter that almost no one broke) to plan long term campaigns. This style of sustenance also kept nomadic band population low as following the herds and the reduction of ease of hunting and complications in moving gave significant advantage to smaller social units.
We see a radical increase in social group size with the advent of agriculture, eventually leading to more permanent town and eventually city living instead of nomadic bands as you generally needed to be in one place to keep others from taking your crops and tending them year round.
I fully understand that there are a lot of luxuries and even just basic life improvements that wouldn’t be available to us if we had kept as small hunter gatherer bands, and maybe a lot of people alive now couldn’t survive or thrive in that kind of environment, it would be a very, very different world than what we know today but one thing I do know is that of we had never discovered agriculture we would never have eventually become a species that could kill off 95% of the life on the planet with the press of a button.
Unfortunately land will fall into disrepair if someone doesn’t actually own it. They have no incentive to invest in its upkeep if it can just be taken away at any moment. There’s a reason rental buildings have a reputation for being unkempt, the renters don’t want to pay for the upkeep since it’s not theirs and the landlords don’t want to pay for the upkeep because they don’t live there.
It gets even worse if government owns it, it would take 6 months just to get a light bulb changed let alone a new roof or hedges trimmed.
Land that falls into “disrepair” has already been savaged, devastated and altered by greedy human hands in the first place.
so i guess over 20% of houses in Austria, Netherlands, or Denmark have no lights and leaking roofs. if only those people got their own…
That might be the case in your country, but there are many cultures that are perfectly capable of sharing and keeping common infrastructure in good conditions. Your personal experience isn’t generic and globally true.
A country’s land should not be owned by individuals, in my opinion, but used by those who need it and when they do so. A country’s land is what makes it a land, so it cannot be owned or sold. Someone inheriting it from someone who took it and maybe sold it should give no legitimate claim to possession.
We have one area of actual steady investment in our lives - our homes. And they can’t handle us making a tiny bit of money
I need an ironic WWII style scaremongering propaganda poster about class war. The 1% have class awareness. Do you?
Scrath’s comment made me check with Bing - i put your comment as the prompt, word by word:
Edit: a week later i was wondering how far image generators get political context right. So i tried the same prompt on civitai ( without any additional resources ). Bing did a better job with the context, at least it repeated some of the input.
Jesus Christ why doesn’t he have skin? Also, at least the hand is right!
I like the otter bat dudes. 😁
Angry zombie British soldier wants you to engage in class awar because the 1% have awawrrnesss, nice
Yes, I have class awaw/rrnesss.
That sounds like something one of those image AI’s might be able to make for you.
This is one of the most destructive things we’ve done as a society: making our homes into investment vehicles. It is the root cause of people no longer being able to afford housing.
Homes don’t generate value though. Nothing more is being created by them existing. How can it possibly be an investment generating more wealth when the underlying asset remains unchanged?
It’s just a pyramid scheme to expect the same exact home to continue going up in value as an investment. The only possible result is a shortage of housing with unreasonably high prices
Or contribute to political campaigns….or a thousand other things they abuse.
no real estate taxes for the first house owned, heavy and progressive taxes starting on the second, is an idea
companies get called people all the time, i’m starting to believe it, but i still think they don’t need shelter, so they shouldn’t be able to aquire a basic human need
I have a feeling they’d just pass those taxes onto the renters.
investors should not be able to either.
B-but CoRpOrAtIoNs Is PeOpLe
I’ll believe corporations are people when Texas executes one.
Weirdly enough new York is on track to do that with Trump’s company.
Easy solution in my opinion:
- only humans can own residential buildings
- you must live in the building you own
No more vacation homes/apartments?
Good question. I didnt think of this. Maybe one needs to make an exception for hotels or something? Obviously this would need to be restricted so residential homes dont get transformed to hotels en masse.
Corps can’t own houses
People can only own a few (say, 2) houses (Marriage, death, inheritance, etc. This makes things easier in the long run).
Multi tenant buildings must be majority owned by a tenant co-op, where all tenants have equal say in all building related things and share in the profits This makes sure landlords can’t raise rent without convincing the tenants that it’s worth the price, incentives the tenants to either maintain the property or hire professionals, and makes their rent an investment in their property, just like a home owner
I’m sure there’s holes all over this plan, but I (and some friends) have put thought into this one a bit.
And this happens if people interested in the matter start discussing. Thank you for this great addition.
- And you may own one cabin but it must be used by you and cannot be rented out
Sounds great. When do we announce our international party to our voters?
You do what you want, it’s your cabin
I have extended family that fall into “lower-upper class” but also know their income has an end date (comes from a lucrative career). They saved up and every time one of their kids turned 18, they bought a house to use as a rental property with a “just in case, my child will never end up homeless” gameplan. Not a huge cash expenditure for them and not a huge profit center, it bought them peace of mind a WHOLE lot cheaper overall than adding an apartment to their house for him to move back into as an adult.
I always found that reasonable, and it did in fact keep them from ending up with a basically homeless 30-something.
I understand the idea and its great if they were able to do that but the world would look a lot different if they would actually do it differently. There would be more houses to buy and they would be cheaper, their money would need to be put in other things to collect interest. The kids would be able to buy the houses themselves at 18 and the parents would have the same outcome, just bad actors would not be able to buy up the market.
To be clear: your extended family is not the problem imo and would not suffer from a law like this.
I understand the idea and its great if they were able to do that but the world would look a lot different if they would actually do it differently
I don’t think anyone has demonstrated that’s true. If everyone but megacorporations stopped owning property other than the one they live in, I don’t thin housing prices or rent would go down. In fact, it would have unexpected side-effects like increased rental rates (since you’d have to jump through even more hoops). Imagine if you will, the pre-flip car lease market. Owning cars was the way of the poor, leasing a new car every few years was the way of the rich. If only owner-occupied could be rentals, rent would skyrocket and the MANY people who want to rent would have to fight with each other. Consortiums would find a legal way to buy luxury rental buildings and have a dedicated “owner” live in them. As you implied, supply and demand. A lot of people don’t want the liability of property ownership for reasons other than “being too poor to buy a house”.
There would be more houses to buy and they would be cheaper, their money would need to be put in other things to collect interest
Yeah, it would collect more interest. So long as nothing happened to them (which it hasn’t), they’d end up a lot richer. But it’s a lot more risk because if something did happen to them, it would be harder for that money to be earmarked into a trust in the kids’ name like the houses are. So they would have had to live with the real risk that their son would end up homeless, but yay they’d have a lot more money.
The problem with a lot of people suggesting real-estate reform is that they don’t understand why individuals (not big businesses, that’s different) buy rental houses. It’s rarely about maximizing profit, it’s about minimizing or mitigating risk.
To be clear: your extended family is not the problem imo and would not suffer from a law like this.
Except, it sounds like you just said they would not be allowed to do what they did, and would be stuck with riskier propositions. Those houses were purchased under little LLCs so that if they got sued into bankruptcy their kids would still have a home (they themselves are under Homestead protections like most homeowners in my state). Not that they expected to be sued, but it’s called “doing anything to make sure my kids don’t end up on the street”. That’s what happens when you grow up in poverty. And there really is no better, simpler, and more reasonable way to make sure your kid won’t be homeless than to buy them a house. And if you’re not filthy rich, that doesn’t mean buying it cash and handing it to them on a silver platter. (technically, I think that silver-platter method would still be allowed under the plan I’m objecting to because the kids would have an owner-occupied house in their name… yay rich people I guess. My family isn’t rich enough for that)
I think you made valid points there. I‘m not familiar with any of the anti bankruptcy measures you just named. Sounds like your family did their research.
To be honest, I still dont think your family is the problem but I dont feel like this is a fair discussion among equals.
I said my piece and you questioning my motives kind of unnerves me. Is your family privileged? Absolutely! Is it fair to the others that they are able to buy homes and even keep them if they fucked up financially while most other lose everything? Not in my opinion.
But I‘m still not after families that try to secure their childrens future. As a privileged person, you might want to add some empathy to your answers in the future.
I’m not questioning your motives directly. I’m suggesting that the changes you’re looking for are still going to cause more harm than good to most people.
Is your family privileged? Absolutely! Is it fair to the others that they are able to buy homes and even keep them if they fucked up financially while most other lose everything? Not in my opinion.
Have you ever read Harrison Bergeron by Vonnegut? I’m not a capitalist, but I still firmly believe you need to show your work when you want to take action that hurts the lower 99% to “even the playing field”.
As a privileged person, you might want to add some empathy to your answers in the future.
You just wrongly accused me of not having af air discussion among equals, and then you pull this? The only thing you know about me is that someone in my extended family has made enough money in their life to buy two rental properties. They don’t owe me anything. How does that make me privileged?
Further, you’re accusing me of lacking empathy. Why? I have the same problem with preventing them from buying a house as you would have if I said we needed to kick EVERYONE out of their homes because somebody out there is homeless. It’s the same thing to me. It’s obviously not the same thing to you. Do I get to say you lack empathy because of it? Because I don’t plan to. Instead, I like to engage as to why that’s a bad idea.
I think there should be some leeway for people who own one home, but want to temporarily live in another city, so they rent their home while living in another rental property at the other city.
I think that is something that could be discussed but we‘d need to make sure peeps wouldn’t just search for a way to circumvent the law (which is always a problem).
True, but I’m pretty sure it’ll be easy to do. If you own more than one home, BAM, penalty tax that is equal to 100% on the rent on that property. If your second home is empty, BAM, quadruple the property tax. You’ve just made owning a second home impossible to profit from.
Okay! Bold but I like it.
We need folks to run with this for political offices though.
Funnily enough, between the time I wrote the comment you replied to, and the time I saw your response I thought of a loophole capitalists could exploit which needs to be addressed.
If corporations aren’t allowed to own residential properties, and a person is only allowed to own a single home, a capitalist could find a person who doesn’t own a home in that territory, buy them a house with the condition that they will manage the property and get 99.9% of the profit it generates. That way, a corporation could go business as usual while technically being compliant…
The proposed law needs to include a section that addresses these sort of loopholes.
I already thought of this as a potential loophole but chose to ignore it since there will be a ton more. Imo, the law should be made as vague as possible and include something like „if a company by any means gains the ability to own or control residential buildings, they should pay twice the amount of revenue (not profit) they make of it. In repeating cases, all people involved with the transaction as well as all directors of said company face up to 10 years in prison.
I think laws should be as clear as possible, not vague. By making a law vague, you’re leaving it for the courts to interpret, and there are plenty of Florida judges who would absolutely stretch their interpretation of the law in a way that conforms to their beliefs.
But I completely agree that making it a criminal act to attempt to circumvent this law would be a key here. Maybe even forcefully dissolving the company entirely for repeating offenders.
One to four units should only be owned by people and the owner should have the obligation to live in it or there should be a radius around their property in which they can’t own a second one.
Five to eight units should only be owned by well regulated corporations with the fiscal responsibilities this implies. The alternative would be co-ops.
Nine and more should be under a non profit state corporation that charges rent based on trying to break even only (that’s how road insurance for people works around here, price is adjusted based on the previous year’s cost to the corporation, it’s way cheaper than private equivalents elsewhere in the country).
Your plan cuts out normal people from the most likely reason they would own two homes, a place to live and a vacation property.
I think the simpler and easier solution would be to increase property tax rate per property owned
How? Do you own your vacation property in the same city you have your house?
Even if it was just a 30 miles radius, it would be enough to dissuade most people who own two properties in order to profit from it.
I misread your comment and had it backwards, sorry
yep
Can I just say, this is a wonderful template. 🐕
No one gets a second home until everyone has their first.
Rental has its place, there have been plenty of occasions in my life where rental suited me better than ownership. Regulation and enforcement of said regulations would do a lot to protect people in this situation.
Dude from Ukraine was telling me that most people own condos. He was weirded out that the vast majority of people in the US don’t have a vested interest into their neighborhood simply because they believe they won’t live there for long.
Did he mention that a lot of the real estate that people own in most post-Soviet countries is inherited when (grand)parents die, this being first if not the only step towards the market for most people?
None of the people I know from Russia, Kazakhstan, Ukraine and Belarus bought their first apartments on their own through hard work or anything: it’s mostly apartments where your grandma died, apartments that you’re either massively helped with or outright gifted by parents when yuu have a significant other to move in with (so both families join funds, most coming from selling some dead relative’s apartment) or on a wedding day (a rarer occasion), or some mix of that.
Without any help or gifts, you’re lucky to be able to get a mortgage that you can pay off before you’re 60 (at least).
The real estate prices outside the US and the EU may seem nicer, but salaries and expenses sure don’t.
Everybody is screwed, everywhere.
Rent apartments. Own houses.
*Since some people really need every combination addressed: Rent/own apartments. Own houses.
How do you handle situations where people want to live temporarily in houses? An example would be a traveling nurse that doesn’t want to be in an apartment building.
We can’t solve the problem for 99.99% of people because of this 0.0000001% person. /s.
I understand your sentiment, but it took all of a half second to think of one scenario that would cause problems in the proposed system.
As frustrating as it is to hold off on a good-intentioned change, it is far more detrimental to charge headlong without considering the consequences. The systems that are in place now are there for a reason. Some of those reasons are greed and corruption, but others are because of they fulfill people’s needs. It would be stupid to build a new system to address the greed side without addressing the need side.
But if you can’t summarize the solution to a complex societal problem with a history to it into a single simple sentence that can be used as a punchy “hot take”, clearly you just don’t want a solution! /s
Way too many people in the world who are more willing to believe that things suck because everyone’s too stupid to try the “obvious” solution, instead of the fact that most societal issues are icebergs of complication and causes.
May people prefer to rent houses over owning one. Many of them I speak to tell me they want nothing to do with house maintenance and upkeep and they prefer to rent so that they don’t have to think or worry about any of the repairs. They like being able to just call the property manager when the hot water stops working or when their kiddo accidentally breaks a window.
When the kids breaks a window, they still have to pay. They just don’t have to source it, which means they might not be getting the best deal.
Plus, most landlords leave things till the last minute or make it such hard work for the tenant to report it, they don’t bother.
The maintenance is built into the rent, so they’re already paying for it, just not getting the best deal and losing the option to do it how they want.
Everything you are saying is true, and even with those facts noted, some people still prefer the convenience of renting and some like the carefree aspect of not having to be responsible for the upkeep.
Then buy a fucking maintenance contract, just like landlords do.
Why do you care so much how someone else chooses to live their life? Some people want to rent and it’s no one else’s business to make them do any different.
If you want to own a house and a buy a maintenance contract go for it.
I personally wouldn’t wish dealing with a home warranty company claim on my worst enemy. They are all scams geared to deny claims.
Houses are pretty terrible for a multitude of factors:
- urban sprawl
- congestion
- pollution
- high cost public works
- low income for public bodies doing those works
- environmental erosion
- flood protection
We should be building apartments that everyone can own, live and be happy in. It shouldn’t be reserved for home owners.
Houses are pretty great for a few factors
- Not sharing a wall with a neighbor
- being able to be louder in general
- Not being woken up by neighbors
- Not getting your home infested with bugs because of having a nasty neighbor
- No loud honking at night
- Not having your door accidentally knocked on to ask if your apartment neighbor is home when they’re not answering their door
- Parking in your own garage
- Having a yard for your dog/kids to play in
Apartments fucking suck in so many ways. I get that they’re pretty handy in City Skylines where everyone bases their urban planning experience from but there is a reason people prefer to live in house and it’s because it gives you separation from other people in a way apartments cannot.
We tried that in the 50’s. They became known as “the projects”.
https://en.m.wikipedia.org/wiki/Public_housing
You end up quarantining the poor into small areas.
Literally the first image in that page is a picture of Singapores public housing, and a claim that they have the highest home ownership rates in the world.
It’s nearly as if public housing can work?
Public housing can work but not without addressing poverty. Using Singapore, which has the death penalty for drug use isn’t comparable.
Otherwise it only makes it worse by concentrating poverty into a ghetto.
Using Singapore, which has the death penalty for drug use isn’t comparable.
I need you to draw a clear through line to why that’s related to public housing policy in any given country.
I’m also gonna like, cite the soviet bloc style apartments, or china’s rapid urbanization in around the same time period that the US decided to make public housing be a thing. I know for the soviet lunchboxes, you had your standard complaints of, oh, long wait lists, subpar build quality, yadda yadda, and then of course towards the beginning of the program you had a large issue with people who had previously been unindustrialized farmers basically just not knowing how to live in an apartment, shit like having your pigs stay indoors and stuff like that. I think similar issues were/are probably a part of chinese publicly subsidized housing complexes. I think barcelona’s superblocks are also publicly subsidized but I don’t know to what extent, and they seem to be working out pretty good. Now those are all places that provide publicly subsidized housing and have provided it to those who were pretty impoverished at the time. They also had/have (again idk barcelona don’t even know why I brought it up) work programs and shit, which we used to have in america, so that might contribute to your point more, but I still think, you know, it is bad to let the perfect be the enemy of the good. The projects were majorly flawed, but they are probably preferable to the whole like. rust belt suburban crime shit. I dunno, realistically it doesn’t really matter what context an apartheid ghetto scenario is happening in, because it’s going to have basically the same consequences on everyone involved.
Rental property should be publicly owned. Landlords shouldn’t be a thing.
I can see there being exceptions if you say own a property but have to move swiftly elsewhere and can’t/don’t wish to sell it, in such a case letting it out makes sense.
No, no exceptions. Once there are exceptions people will abuse them. Even if you inherited your parents property if you already have one you should have to pay extra taxes on it from the day they die until the day you sell it, period. Any person, family, business, or corporation should only own one property, zero exceptions.
Edit: /S. Thought that was obvious
Regarding the edit, I’ve seen people unironically post this take on lemmy.
Yeah that’s not far off from some folks’ actual unironic opinions so the /s is unfortunately not obvious, lol. The Poe’s Law situation isn’t even hypothetical in this one.
People who own second and third homes aren’t even the issue. It’s mega corps that literally own tens of thousands of homes each. A better way to go about it is to just progressively tax people more per home. That second home gets taxed at the same rate but any home after is taxed way way way more. If someone can still afford it then that’s fine, just more tax money coming in. That and don’t let corps own rental properties.
In Texas, your property tax is already somewhat two tiered. Your first home is taxed as a homestead and you get an exemption on part of the property tax. If you own a second, third, etc you have to pay the full amount and the annual increases are not capped. Im not 100% sure on the specifics as I don’t own more than 1 though.
Your not homestead house will be ~$2,000 higher in taxes than if it were not homestead. Exemption is up to $100k I believe, so I’m going off roughly 2% of exemption for additional taxes.
And all that higher tax cost is passed directly on to tenants
At some point the taxes would be so high that nobody could afford to rent and the owners would lose money forcing them to sell. Which is fine. Just gotta make the taxes higher for more than x houses.
Logarithmic scale of increasing property tax rate
Not sure if you actually meant logarithmic or exponential. An exponential tax rate would mean that the more you own the next unit of value would be a lot more in tax, while a logarithmic tax rate would mean that the more you own the next unit of value would be a lot less in tax. See x2 versus log2(x) (or any logarithm base, really). The exponential (x2) would start slow and then increase fast, and the logarithmic one would start increasing fast and then go into increasing slowly.
At least 20 corporate shills have seen this post
