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Berlin approves 5-year rent freeze

reuters.com

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Re: Berlin approves 5-year rent freeze

#171

Post by flanbiscuit »

bpfrh wrote: post #154
vtail wrote: post #125

Earlier quoted context omitted.

People buying apartments to rent out via Airbnb is not inherently a bad thing - it just indicates there is existing unsatisfied demand for short term rentals, which cannot be fulfilled by hotel industry. And guess what - hotel industry is another example of an industry heavily regulated by government (zoning laws, construction permits etc.). So the Airbnb problem most likely has the same underlying root cause.

No it is an indication that people are cheap and a person who bought a apartment as an investment now makes 30-60€ a night vs about 600 a month. There is a reason hotels are expensive. Airbnb does the same as uber. They start a business with either exploits a loophole or is illegal. Btw. at least in austria, if you want to rent your apartment on such a plattform you have to clear it with everyone who lives in that ho…

> if you want to rent your apartment on such a plattform you have to clear it with everyone who lives in that house.

I love this idea. My friend currently lives in a building in Brooklyn where a person rents out rooms in his apartment on AirBnB and it's been nothing but an annoyance since day one. I'm glad NYC has put some restrictions on AirBnB .

Re: Berlin approves 5-year rent freeze

#173

Post by southerndrift »

andy_ppp wrote: post #26
chmod775 wrote: post #8

Earlier quoted context omitted.

This would only be true if rent wasn't already (relatively) way above the cost of new construction and if the freeze applied to new buildings too.

Land values rise to make the margins developers work within very small. Land is a problem everywhere and someone owns it and will always try to extract the best price if you have planning permission for it. So maybe capping land prices and forcing sales for desirable schemes would work better. It will of course never happen as ownership is fundamental to our thinking in the west. I actually find the idea of the gover…

The new law about the property tax links the tax amount to the value of the area. If done right, this forces house owners to rebuild their property and adjust the density if they want to remain profitable.

Re: Berlin approves 5-year rent freeze

#174

Post by supergauntlet »

a_c_s wrote: post #168
SomeOldThrow wrote: post #94

Earlier quoted context omitted.

Anyone who looks at regulations like this and sees the Soviet Union is themselves a lunatic. This is not a planned economy, and people do not need to profit from housing to build it, and housing should be a human right.

> people do not need to profit from housing to build it People do need to profit from something to do it in a capitalist society.

Housing is not a market that should be governed by capitalism. I honestly don't care if the ultra-rich trade 30 million dollar homes and speculate on their value, but the fact that homelessness is even a problem in the first world is a travesty.

Our children will look back upon a time when there were 6 (SIX!) empty homes for every homeless person in the United States and weep. Obviously those homes aren't all where the homeless people are, but that's another problem itself: Why on earth are developers building homes in the middle of nowhere, why are they building luxury condos, and who the hell is buying them?

Re: Berlin approves 5-year rent freeze

#175

Post by codedokode »

SomeOldThrow wrote: post #94
vtail wrote: post #3

As a person born and raised in Soviet Union, I strongly believe that whoever thinks that a proper economic response to raising prices is literally to order them to stop raising , is a lunatic.

Anyone who looks at regulations like this and sees the Soviet Union is themselves a lunatic. This is not a planned economy, and people do not need to profit from housing to build it, and housing should be a human right.

Nice idea. Can I have a free apartment in the centre of Moscow within 5 minutes walk from subway then?

What I want to say is that houses are different and there are places where everybody wants to live and where nobody wants, and that is why the housing prices can be so high. Maybe instead of asking for a fixed rent people should consider a cheaper place to live? Everybody cannot live within 5 minutes from a subway station.

Re: Berlin approves 5-year rent freeze

#176

Post by chimeracoder »

CPLX wrote: post #144
baron816 wrote: post #129

Earlier quoted context omitted.

The problem with these types of price controls is that it’s inherently unfair. If you’re on the inside and lucky enough to get a rent controlled apartment, you win. Everyone else loses.

That's correct. Or said another way, if you have strong ties to the city and/or are a longtime resident of the neighborhood you win, if you don't you lose.

> Or said another way, if you have strong ties to the city and/or are a longtime resident of the neighborhood you win, if you don't you lose.

This has literally nothing to do with who ends up in a rent stabilized apartment.

In fact, new residents are more likely to end up in rent stabilized apartments than existing residents, so rent stabilization has the exact opposite effect of what you're describing it does.

Re: Berlin approves 5-year rent freeze

#177

Post by zjaffee »

cyrksoft wrote: post #146
hashberry wrote: post #31

If affordable housing is an issue, then perhaps the government should provide it for its citizens, like building huge high-rises in Berlin. I used to rent in an expensive city but bought a cheap house in the suburbs (thankfully I work remotely). Everything is cheaper out here, from gas to utilities to food. But I did experience classism from my friends and family: there is status living in a world-class city. And hav…

> Government should provide it for its citizens And how do you expect government to pay for that? How do you decide who lives in these houses? It's not that easy. Government isn't a magic entity.

One of the biggest costs of new rental construction is financing costs (on a 30 year loan it's often half of the cost). Given that it's cheaper for the government to borrow money than the private sector you can have the government simply build market rate housing, but wouldn't need to charge as much in rent.

In this context, the government can essentially be a magic entity.

Re: Berlin approves 5-year rent freeze

#178

Post by CPLX »

Rebelgecko wrote: post #135
CPLX wrote: post #113

Earlier quoted context omitted.

> rent controls are damaging To whom? Rent controls redistribute the value capture from gentrifying neighborhoods away from landlords and towards longtime residents. That's what they're intended to do, and they do that.

Anecdotally, I know multiple people that have turned down better paying (and arguably better for society) jobs because they would have to move but don't want to give up on their current rent-controlled apartment. What seems to always end up happening is that new residents subsidize the rent controlled ones, which creates this weird lock-in dynamic because people can't afford to move into equivalent housing literally…

> What seems to always end up happening is that new residents subsidize the rent controlled ones

Not really.

It's landlords that subsidize rent controlled tenants.

The system is redistributive. The value that would have gone to landlords in an increasing rent environment goes to the tenant instead.

Theoretically it can distort the market, provide disincentives to building housing, etc etc. But those are second order effects, and situational, and often very arguable.

In economics terms the subsidy flows from property owner to tenant.

Re: Berlin approves 5-year rent freeze

#179

Post by stefanfisk »

bpfrh wrote: post #164
vtail wrote: post #3

As a person born and raised in Soviet Union, I strongly believe that whoever thinks that a proper economic response to raising prices is literally to order them to stop raising , is a lunatic.

As a person living in austria, I strongly believe that goverment build housing and strong regulation of pricing and the market is the only way to keep housing affordable for all people and not make it a speculation object like in germany/berlin. Did you know that in the late 90 the housing was good and affordable? And that a big chunk was owned by the city or state? That these things were then sold for pennies, to co…

the exact same transition happened here in Sweden, and now the housing market is so fucked that it might take down the economy in the next recession.

Re: Berlin approves 5-year rent freeze

#180

Post by wander_homer »

mamon wrote: post #122
wander_homer wrote: post #101

Earlier quoted context omitted.

> Why is greed so bad here? The problem isn’t greed it’s the demand in the face of the lack of supply. Greed is bad in this situation because you can make more money of luxury apartments than those suitable for people who are somewhere between the poverty line and upper middle class. Hence new apartments in major cities tend to be more and more expensive to satisfy the demand of wealthier people. Greed is also bad wh…

Upper middle class are usually not homeless, right now they occupy some pool of apartments in cities anyway. By building more luxury apartments you encourage them to move, thus leaving their old apartment behind, either by putting it on sale, or renting it out. Think of this like a domino effect: those earning $10M per year buy luxury residence, leaving their old house for those earning $1M, who in turn leave their o…

> Think of this like a domino effect: those earning $10M per year buy luxury residence, leaving their old house for those earning $1M, who in turn leave their own houses to those earning $500K, who leave their apartments for those earning $200k, and so on, and so on.

This assumes that a) rents don't increase for the new residents (which is false) and b) people only move within a city and there's no high demand from people outside to move into the city (which is false too).

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