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The Victims of the Eviction Moratorium

reason.com

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Re: The Victims of the Eviction Moratorium

#61

Post by sbierwagen »

watsocd wrote: post #22
tomg wrote: post #14

I don’t understand how a waiter and a home-care provider can afford to buy a rental property that is apparently worth charging $80,000/yr in rent. I’m in the wrong business! [edit: to be clear, this is tongue in cheek, though the circumstances where a bank made this loan seem unusual to me]

By being extremely frugal. Did you read the part of the article where the owner does not live in the house. The owner lives in a "cheap studio apartment nearby with their two young daughters". That is how!

Frugal? Interesting.

Let us closely examine the text.

>Take Won, a Chinese immigrant landlord who asked that we only use her last name. She owns a two-family house in Queens and works as a home health aide caring for an elderly couple. Her husband is a waiter at a restaurant in Manhattan's Chinatown, though he's barely been able to work since the pandemic began. Won says her tenant owes her more than $80,000 in back rent. "I just want the government to open the court," she tells Reason.

She owns a house in New York City. To put it mildly, NYC real estate is not cheap. How did she do it? Cash transaction? Is it mortgaged? Those are two very different types of ownership... but Reason makes no distinction between the two. Why? If she was on the hook for a mortgage payment, surely they would have brought it up, since it would have made her case much better. But they didn't.

The tenants owe $80,000 over a year? $6,666 a month? How big is this house? When did Won buy it? How much did she pay?

It would be two very different stories if Won had bought the place in 1970 for ten grand, versus a $2 million straw buy for a PRC upper party member. Reason doesn't want to tell us which, because it is an explicitly ideological publication, funded to promote a specific view of the world. I don't blame Reason for wanting to be the NYT of Libertarianism, but you do need to apply a degree of critical thinking to what they say.

There is absolutely zero chance a home health aide bought a house in New York City by "being frugal" any time in the 21st century. Either she bought it many decades ago, or the money came from somewhere else.

Re: The Victims of the Eviction Moratorium

#62

Post by pydry »

derekp7 wrote: post #45
pasabagi wrote: post #12

Earlier quoted context omitted.

What is the moral basis of rent? Rent is by definition differentiated from service provision in that it is simply the use of a legal right to extract an income. I don't see a moral basis, so I don't see how anything that impacts the interests of renters can be unfair. Bad on pragmatic level, perhaps, but not a moral one.

The moral basis comes from how the majority have agreed to structure society. A family isn't legally allowed to go to an unoccupied piece of land, start cutting down trees or making mud bricks into a shelter and stay there. We have divided up the land (a limited resource) into parcels of private ownership with government-enforced property rights. With that comes a moral responsibility to make sure that everyone can o…

>We have divided up the land

If you dig just a little deeper into precisely how this was done, it gets extremely ugly very fast.

The only real argument for not resetting an inequitable distribution of land ownership is that the owners of unearned privilege have a habit of defending that privilege with extreme violence.

The US invasion of Cuba subsequent to their land redistribution was one example of this.

Re: The Victims of the Eviction Moratorium

#63

Post by door100 »

Veen wrote: post #50
pasabagi wrote: post #12

Earlier quoted context omitted.

What is the moral basis of rent? Rent is by definition differentiated from service provision in that it is simply the use of a legal right to extract an income. I don't see a moral basis, so I don't see how anything that impacts the interests of renters can be unfair. Bad on pragmatic level, perhaps, but not a moral one.

The moral basis is the tenancy contract signed by the tenant and landlord-unless you believe contracts should not be enforceable.

I don't care about "enforcing contracts" as an abstract concept. If a contract is unjust, there is no reason it should be enforced. A contract that forces someone to pay $X a month or face homelessness during a huge economic crisis is not a just contract.

Re: The Victims of the Eviction Moratorium

#64

Post by josephg »

DC1350 wrote: post #42

I don’t really get how this is possible. They should be able to take out a loan against the property to pay for any expenses, and just sell it at the end to pay off debts if they need to once this is over. They’re upset about lost income but not really struggling... Their net worth is just as high as a renter with a few hundred thousand in the bank. I would have a hard time feeling sorry for somebody in that position…

You’re assuming they own the property outright with no mortgage, which is pretty unlikely. If they have a loan already the bank might not want to loan them more money against the property in the current market. And if they sell it, to who? It’ll be at a massive discount right now and they might not be able to cover the amount they owe to the bank.

Re: The Victims of the Eviction Moratorium

#65

Post by testfoobar »

jedmeyers wrote: post #49
testfoobar wrote: post #20

Earlier quoted context omitted.

So much of the official government response has been to support entrenched wealth. Some examples: large stores remained open, while small stores were forced to close in many regions. Financial support was provided to large businesses via PPP funding that wasn't available to small businesses. Capital subsidies of near 0% loans were extend to the largest companies (e.g. the Fed owns Apple bonds) while smaller businesse…

> So much of the official government response has been to support entrenched wealth. There is a word that describes this kind of merger of corporate and government power, I just don't seem to remember it.

How do you get well meaning folks to see where it is all heading?

Re: The Victims of the Eviction Moratorium

#66

Post by mjfl »

mauvehaus wrote: post #35
mjfl wrote: post #21

Earlier quoted context omitted.

Why should landlords take the loss on rent and not who they pay mortgage to?

Sunk cost. They'll lose their equity stake in the property (as well as future income) if the bank forecloses on the property because the landlords aren't making mortgage payments. Do the banks want to be in the situation of being landlords (even temporarily) of a huge number of tenants who are not or cannot pay rent? Doubtful. Does that mean they're a little less likely to foreclose on a rental property when there ar…

I was thinking more from an ethical, policy point of view than from the strategic point of view for the landlord.

Re: The Victims of the Eviction Moratorium

#67

Post by door100 »

whitepaint wrote: post #60
door100 wrote: post #41

Cea Weaver, who is used as a foil and whose perspective is unfairly maligned in this article, is basically 100% correct. Landlordism should not exist. Housing is a human right and should not be an investment commodity. > Emergency policies enacted in times of crisis are prone to becoming permanent, which some members of the #CancelRent movement say is the goal. This is a good thing. The COVID crisis has exacerbated t…

> Landlordism should not exist. So, if I own an apartment / house / room, I can't go and have a contract with another person willing to take on that contract and live in my place by the agreed rules beforehand?

I believe in a world in which housing is a public good and a human right, so that no one would have to rent from anyone else in order to have access to housing. In this world, housing would cease to be a profitable investment vehicle, and thus landlordism would no longer exist.

Could I "enter in a contract" to lease "land that I own" in a national park? No, because national parks are a public good that everyone shares in their ownership and right to access. Housing should be the same way.

Re: The Victims of the Eviction Moratorium

#68

Post by bigmattystyles »

sbierwagen wrote: post #61
watsocd wrote: post #22

Earlier quoted context omitted.

By being extremely frugal. Did you read the part of the article where the owner does not live in the house. The owner lives in a "cheap studio apartment nearby with their two young daughters". That is how!

Frugal? Interesting. Let us closely examine the text. >Take Won, a Chinese immigrant landlord who asked that we only use her last name. She owns a two-family house in Queens and works as a home health aide caring for an elderly couple. Her husband is a waiter at a restaurant in Manhattan's Chinatown, though he's barely been able to work since the pandemic began. Won says her tenant owes her more than $80,000 in back…

Frugal is not plausible but a straw buyer for a PRC member (and who is going to voluntarily talk to a newspaper) is? I'd argue buying in the Bronx or Brooklyn in the 80s, putting in sweat equity where possible and reaping the benefits much later is much more plausible.

Re: The Victims of the Eviction Moratorium

#69

Post by nostrademons »

tomg wrote: post #14

I don’t understand how a waiter and a home-care provider can afford to buy a rental property that is apparently worth charging $80,000/yr in rent. I’m in the wrong business! [edit: to be clear, this is tongue in cheek, though the circumstances where a bank made this loan seem unusual to me]

Leverage & frugality.

Double 3/1 duplexes in Queens go for about $1M; the monthly payments on this are about $5200/month [1]. Each unit will rent for about $2700/month [2][3], so you're making a profit of about $200/month and paying down the principal steadily. You just need to cover a $200K down-payment. Minimum wage in NYC is $15/hour, so a two-earner couple working 40-hour weeks makes about $60K/year; it could be up to $90K if they each have work 12 hour days, as many Chinese immigrants do. Live in a 1BR apartment and you're spending about $15K/year on rent, maybe $25-30K/year on all expenses. You can save up for that down payment in about 4 years.

I don't have too much sympathy for them because the risk of being unable to find a tenant and hence unable to make your mortgage payment is precisely why not everybody levers up as much as possible to buy a rental property. But that's how the numbers work out. Most people on HN could probably do it, if they had the savings habits and risk tolerance of that couple.

[1] https://www.zillow.com/homedetails/17520-Baisley-Blvd-Jamaic...

[2] https://www.zillow.com/homedetails/131-19-134th-St-South-Ozo...

[3] https://www.zillow.com/homedetails/180-05-90th-Ave-FLOOR-1-J...

Re: The Victims of the Eviction Moratorium

#70

Post by heliodor »

reanimus wrote: post #19
heavyset_go wrote: post #4

I find it hard to be sympathetic with people who chose to overleverage themselves with their investments.

I really don't understand why we insulate landlords from investment risk so much. At the end of the day they can sell the place to mitigate their losses. What recourse could renters have?

The risk was created out of thin air by a random choice of government policy.
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