Public-ownership rental as a third option to renting or owning a house • Hacker News Board

Re: Public-ownership rental as a third option to renting or owning a house

#181

Post by lotsofpulp » Mon, Apr 19, 2021, 2:19 AM UTC

chii wrote: post #168

bradleyjg wrote: post #125

Earlier quoted context omitted.

With interest rates having nowhere to go but up, look for the government to introduce the fifty year mortgage in order to keep the party going.

why would the gov't be in control of the mortgage period? That's between the borrower and the bank.

In the US, most of the mortgage market has the government as the guarantor, via Fannie Mae, Ginnie Mae, and Freddie Mac.

If you have a conforming loan, then whoever is collecting interest is basically insured by the US taxpayers.

https://en.wikipedia.org/wiki/Conforming_loan

Re: Public-ownership rental as a third option to renting or owning a house

#182

Post by aidenn0 » Mon, Apr 19, 2021, 2:24 AM UTC

nemo44x wrote: post #15

Renting is underrated but owning is nice too if you want to root. However I think a lot of renters or people that complain they can’t afford a house also forget about the costs of property tax and maintenance. Those are 2 costs that never end and don’t remain fixed (in most places) over time. For instance, anywhere reasonably commutable to NYC and close to a train line is going to probably have 10’s of thousands a ye…

I now pay more per year in property taxes outside of town than I did for rent on my first apartment (~15 years ago) walking distance from downtown. Granted it's considerably less than what rent probably is on that apartment now; rent has roughly doubled in that time.

Re: Public-ownership rental as a third option to renting or owning a house

#183

Post by lotsofpulp » Mon, Apr 19, 2021, 2:26 AM UTC

bombcar wrote: post #149

Pfhreak wrote: post #102

Earlier quoted context omitted.

The US had a history of spending capex on flashy high rise housing. Then failing to spend the opex necessary to maintain what they built. Large buildings are harder to maintain and require more specialized labor. Means testing and segregation also impacted public housing in the US. (Better not make too much money or you'll have to leave!) There are several instances of successful public housing efforts in the US and…

Part of the problem is the false dichotomy between single family suburban style dwellings and high-rises. The middle ground, medium density row houses and similar, is almost impossible to build anymore in many locations. The costs and regulations are such that either you build a single family dwelling or fight for a high-rise.

It’s a dichotomy because politically active and influential people do not want density near their detached single family suburban style homes. Everyone wants to live around people at or above their level.

If you’re a developer, then fighting against this group will take a lot of resources and it’s risky, so you can’t bet on medium density to make it worth it, you have to aim for more.

Re: Public-ownership rental as a third option to renting or owning a house

#184

Post by wolverine876 » Mon, Apr 19, 2021, 2:29 AM UTC

InvertedRhodium wrote: post #78

jawns wrote: post #25

I'm a distributist, so I would prefer to see this type of system operated as a private cooperative, 100% owned by participants, rather than a government-run program. Why? Because then the people who get to make the decisions are the co-op participants themselves -- the people with the most skin in the game -- and the government can instead focus on areas where the participants actually need help, e.g. at the regulato…

How does that differ meaningfully from home owners associations and the like?

One difference: Each coop member owns shares in the entire organization's assets, not in their specific unit (or they own the same fraction of their unit that they own of their neighbor's). For example, imagine the cooperative owns 10 buildings totally 50 units, worth $12 million total. Each of the 50 shareholders owns shares worth $12m/50 = $240,000.

For simplicity, I'm omitting the issue of the members building equity over time.

Re: Public-ownership rental as a third option to renting or owning a house

#185

Post by wolverine876 » Mon, Apr 19, 2021, 2:32 AM UTC

jawns wrote: post #25

I'm a distributist, so I would prefer to see this type of system operated as a private cooperative, 100% owned by participants, rather than a government-run program. Why? Because then the people who get to make the decisions are the co-op participants themselves -- the people with the most skin in the game -- and the government can instead focus on areas where the participants actually need help, e.g. at the regulato…

> I would prefer to see this type of system operated as a private cooperative, 100% owned by participants, rather than a government-run program.

My thought too. There is cooperative housing that is run this way, though not on a large scale (that I know of).

Re: Public-ownership rental as a third option to renting or owning a house

#186

Post by celticninja » Mon, Apr 19, 2021, 2:32 AM UTC

imtringued wrote: post #113

celticninja wrote: post #105

Earlier quoted context omitted.

When you sell the outstanding loan is paid off by the purchase price, the lender and owner take their respective share of the price

The new landlord would raise rents, because he has to get his money back somehow. It would be better to just let the government pay the full mortgage and pass on the costs for the first 30 years and then lower rents to rock bottom prices based on maintenance costs after it has been paid off.

What is more likely to happen is that the housing association that helps with the mortgage then offers it to someone else who is in need of this type of social housing. The risk becomes less for the housing association each time as more of the principal is paid off. But even when it is paid off they can offer the loan service to new buyers.

This happens frequently in new build housing in the UK but it is not without its problems.

Re: Public-ownership rental as a third option to renting or owning a house

#187

Post by anonymouse008 » Mon, Apr 19, 2021, 2:33 AM UTC

Spooky23 wrote: post #67

don-code wrote: post #63

I didn't quite glean a thorough understanding of the model from the article. It sounds like it's: 1) Public funds provide capital to build a new dwelling; individuals move in at rates similar to market rent. 2) Rather than rents paying a landlord, rents act like principal payments on a personal mortgage - e.g. I own $10,000 worth of shares of the property after paying $1,000/mo for ten months. 3) Eventually, I own en…

My dad administered a similar program for getting historically disadvantaged people owning multi family homes. Basically, folks would sign up for home ownership education, do a bunch of stuff related to maintenance, etc and shop for a two family. The housing authority (through a grant) would essentially provide a loan for 20-30% of the purchase price for down payment and some repairs. The loan would be forgiven in 5…

Is it replicable in today's yield chasing world?

And what level of gov't buy-in do you need? US Congress, State, County, City?

Was just speaking with my dad about programs - he has a ton of ideas because our hometown area is characterized as one of generational poverty and working poor.

Re: Public-ownership rental as a third option to renting or owning a house

#188

Post by mgerdts » Mon, Apr 19, 2021, 2:42 AM UTC

greggman3 wrote: post #179

mgerdts wrote: post #166

Earlier quoted context omitted.

The one time I lived in a neighborhood with a HOA, i found it provided a private pool and and a way for neighbors to be more exclusive, not inclusive. For instance, one of the HOA rules was that you cannot have any vehicle with commercial signage or lettering (like a plumber's van) parked outside over night. If my parents were to stay the night, the rules said that their pickup with lettering advertising their small…

I totally get how that sucks but, if I lived in such a neighborhood, for that particular problem, could I solve it by buying a car cover? Not that I should have to, just curious.

The solution, as described by a wealthy neighbor when discussing something different (placement of plants?), was to just ignore the HOA. The HOA has a shoestring budget and a $10k legal bill would bankrupt it. So, if you are wealthy enough to hire expensive lawyers, rules don't apply to you.

That neighbor was a doctor that ran clinical trials. The discussion with him on HOAs and other topics left me disillusioned in so many ways.

The entire point of my earlier message was to point out that HOAs of the form I've seen are not a means to encourage diversity or inclusion. Rather, they are about maximizing home values by ensuring conformity to the target market.

Re: Public-ownership rental as a third option to renting or owning a house

#189

Post by 6510 » Mon, Apr 19, 2021, 2:45 AM UTC

imtringued wrote: post #126

6510 wrote: post #97

Land tax is a must but I have an even funnier idea. Tax corporations per employee and adjust the amount to the housing shortage. Make the tax truly terrifying if there is a big shortage. If you really must run your shop in that ultra expensive location you just pay for it. If you cant afford it you simply do not have what it takes, the area is not for you and you should leave. Make room for a business that belongs OR…

Your proposed tax could be based on a "housing pressure index", basically squarefeet of livable space per person or people per squarefoot. This index would measure if there are lots of families living in cramped conditions or people living with room mates. If housing pressure is too high, tax corporations more.

If you go by squarefoot large homes would distort the picture. I was thinking some formula counting people who want/need to live there.

Re: Public-ownership rental as a third option to renting or owning a house

#190

Post by mardifoufs » Mon, Apr 19, 2021, 2:45 AM UTC

anonymouse008 wrote: post #187

Spooky23 wrote: post #67

Earlier quoted context omitted.

My dad administered a similar program for getting historically disadvantaged people owning multi family homes. Basically, folks would sign up for home ownership education, do a bunch of stuff related to maintenance, etc and shop for a two family. The housing authority (through a grant) would essentially provide a loan for 20-30% of the purchase price for down payment and some repairs. The loan would be forgiven in 5…

Is it replicable in today's yield chasing world? And what level of gov't buy-in do you need? US Congress, State, County, City? Was just speaking with my dad about programs - he has a ton of ideas because our hometown area is characterized as one of generational poverty and working poor.

What do you mean? Yield chasing usually stems from a yield starved market, and it usually results in investors expecting a lot less returns. If anything that would make it way more replicable now than it was when interest rates were presumably a lot higher.