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Home ownership is the West’s biggest economic-policy mistake

economist.com

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Re: Home ownership is the West’s biggest economic-policy mistake

#221

Post by jorvi »

tuukkah wrote: post #198
elric wrote: post #182

Earlier quoted context omitted.

> a minimum 5% deposit + 3-5% stamp duty Oh wow. I had to read the rest of your comment twice to understand that you were saying these seem high to you. They seemed really low to me. To put it into perspective, you need a 10-20% deposit in Belgium (depending on various factors) and there's a 6% tax for an old house (10% up until very recently) or 21% for a new house. It's basically impossible to buy a house if you're…

In comparison, in Finland the stamp duty is 0% when you buy your first home while you are under 40.

> while you are under 40

This seems such a weird condition to add. Someone who doesn't earn much but saves up over 22 years for a house has to pay stamp duty on his first house, but someone privileged who can buy a house when 30 years old doesn't?

Re: Home ownership is the West’s biggest economic-policy mistake

#222

Post by Hamuko »

jcadam wrote: post #208
pc86 wrote: post #193

Earlier quoted context omitted.

> and selling a few years later That might be part of the problem? It's extremely rare to make a profit selling a home less than 5 years after you bought it even in good-but-not-insane markets. Basically unheard of in under 3 years in not-insane markets. If the market slips you're easily looking at 7-8 years to break even. The math of a six-figure, three-decade loan just doesn't support quick flips even just to break…

Just sold a house in FL I bought in 2019. Realized I made a mistake in buying it - luckily the absolutely insane housing market right now in FL allowed me to get out without losing my shirt.

The housing market feels insane here as well. If my apartment fetches the same price per square metre as what other apartments in my area of the same age are listed for, my apartment would sell for like 30,000 € more today than what I paid for it like two years ago.

Re: Home ownership is the West’s biggest economic-policy mistake

#223

Post by kiba »

yrgulation wrote: post #78

Property ownership is bad. Rent for life, dont leave inheritance to your children so they can rent for life too. All you need in life is clothing, entertainment, a bit of travel to distract you from your tiny living space, maybe a gadget or two and of course onsite work. Oh and praise from you manager to add meaning to your daily grind. Or so “they” say while “they” amass thousands of properties and massive fortunes…

Owning a home as a form of wealth necessarily conflict with affordability. We need to consider one or the other in order to make the best use of land, which are finite.

If we choose to make having a home a priority, then we need to choose affordability both so that people are less likely to be homeless and so that people can do other thing with their money.

Re: Home ownership is the West’s biggest economic-policy mistake

#224

Post by bsenftner »

bovine3dom wrote: post #77
Traster wrote: post #48

I don't think this article makes a logical argument at all. It says house ownership is bad because it gives people a vested interest in constraining the supply of housing. That's true but that's not a problem. If people didn't own houses then someone would, and that someone is still incentivized to constrain the supply. I'm also not sure that reducing home ownership is a good idea - "let's make everyone poorer" doesn…

> If people didn't own houses then someone would, and that someone is still incentivized to constrain the supply. Yes, but constraining the supply is done through political means: planning laws, green belts, individual objections to developments, voting etc. All of those in theory are based on "one man one vote", so if you concentrate ownership of supply you drastically reduce the number of votes it gets. > the middl…

At the risk of sounding racist, Asian culture respect their commons to a significantly larger degree than non-Asian cultures. If the Singapore residential skyscrapers where in the United States, for example, the space between the buildings would be a no-mans zone of graffiti, illegal trade, and youth gangs.

Re: Home ownership is the West’s biggest economic-policy mistake

#225

Post by fifticon »

ZoomZoomZoom wrote: post #81

>Those who own homes often become NIMBYs who resist development in an effort to protect their investments. I don't get it. Isn't this a good thing? People protect theirs and pay far less attention to commons and rented properties.

I agree. Obviously too much NIMBY is possible, but in general I appreciate that local people get a say in, how their own local environment should or shouldn't be transformed. The alternative, where some nebulous central agency or authority(which lives nowhere, and doesn't have to live with or in the result) decides which areas should be developed how, sounds horrible to me.. "Let's just plonk some more skyscrapers down on this lot, next to these other blocks of skyscrapers".

That said, in my local city, possibility of financing and no concrete loud protests seems to be enough to 'plunk down hi-rises'. I hope some will like the results, because pretty it's definitely not. And it won't be cheap housing either.

Re: Home ownership is the West’s biggest economic-policy mistake

#226

Post by watwut »

bovine3dom wrote: post #102
brobdingnagians wrote: post #87

Earlier quoted context omitted.

Some people in Singapore may love their flats. Some of them might wish they could buy a house. People should be able to choose. People who love flats can live in flats, people who live detached homes can save up and buy or build one. It is odd that we have simply accepted that the government has the right to tell everyone if they can live in a flat or a house. I could think that arranged marriages are much better tha…

There are detached homes in Singapore - their price and taxes just reflect the fact that about a hundred people would normally be living on the same ground, and those people have to be compensated. I think a fairer comparison in terms of relationships is like polygamy: forbidding people to live above or below you is a bit like taking away extra potential spouses. I believe polygamy is illegal in most societies due to…

Inequalities never stopped societies in general. People making laws/regulations often like inequalities.

Re: Home ownership is the West’s biggest economic-policy mistake

#227

Post by globular-toast »

dr_dshiv wrote: post #37

What if renters could have a way to pay more to gain partial ownership of their property? E.g., could progressively own up to 10%. That woulf allow for more of the feeling of ownership and allow renters to participate in the appreciation. That would mitigate some of the negative impacts of gentrification. Has anyone given this sort of renter-ownership blend a thought?

If I own 10% of a property does that mean I can put shelves up on 10% of the walls or change 10% of the locks? What's more likely is this kind of "ownership" is only paper thin. The only reason I want to own a house is because I want to control the place where I live. It doesn't make much financial sense, though. If you just want to add property to your portfolio there are plenty of other ways.

Re: Home ownership is the West’s biggest economic-policy mistake

#228

Post by throwaway316943 »

yrgulation wrote: post #78

Property ownership is bad. Rent for life, dont leave inheritance to your children so they can rent for life too. All you need in life is clothing, entertainment, a bit of travel to distract you from your tiny living space, maybe a gadget or two and of course onsite work. Oh and praise from you manager to add meaning to your daily grind. Or so “they” say while “they” amass thousands of properties and massive fortunes…

Literally rent seeking, they want to turn the West into Saudi Arabia, essentially a techno-feudalism with debt slavery.

Re: Home ownership is the West’s biggest economic-policy mistake

#229

Post by KptMarchewa »

Traster wrote: post #48

I don't think this article makes a logical argument at all. It says house ownership is bad because it gives people a vested interest in constraining the supply of housing. That's true but that's not a problem. If people didn't own houses then someone would, and that someone is still incentivized to constrain the supply. I'm also not sure that reducing home ownership is a good idea - "let's make everyone poorer" doesn…

> the middle class who used to be able to live in a nice semi/detatched house are now living in flats in a skyscraper that is a massive detriment to their quality of life

Having to own a car, maintain lawns/garden or pay someone for it, and having to commute for hour one side instead of 15 minute walk would be an extreme detriment to my quality of life.

Re: Home ownership is the West’s biggest economic-policy mistake

#230

Post by pc86 »

dbetteridge wrote: post #192
pc86 wrote: post #190

Earlier quoted context omitted.

Is that tax added into the mortgage as a lump sum (meaning you pay interest on it for the life of the loan) or is it added to the payment each month?

Not sure how Belgiums works, but Australias stamp duty is a lump sum you pay alongside your deposit when buying the property. Correction: I double checked and it looks like it can be added to your mortgage, which isn't as bad up front.

That's rough, although paying it once and being done with it is certainly preferable (long term, if you have the funds) to wrapping it into the mortgage and paying 3-4x over the life of the loan.
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