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Dutch cities want to ban property investors in all neighborhoods

nltimes.nl

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Re: Dutch cities want to ban property investors in all neighborhoods

#391

Post by gruez »

kingludite wrote: post #305
refurb wrote: post #201

Earlier quoted context omitted.

The bank is collect money in the future that is worth less than what they leant out today - time value of money. Charging 0% interest means the bank is losing money.

I don't get how people can keep saying this. Is it that people are told banks lend out money from depositors in school? Anyway, if you sign a contract that says you shall pay me every month for 30 years OR ELSE I get to sell your house (and whatever else you own, seize your income etc) then the document with your signature IS the value created and I can sell that document for what it is worth. So the bank creates mon…

>>Charging 0% interest means the bank is losing money.

> I don't get how people can keep saying this. Is it that people are told banks lend out money from depositors in school?

They don't? Where is the money from? Due to complicated reasons (ie. bundling mortgages into mortgage backed securities and selling them), it might not be the case that the mortgage issued by Bank A is funded by Bank A's depositors, but it is the case that it's funded by depositors/investors somewhere.

Re: Dutch cities want to ban property investors in all neighborhoods

#392

Post by merrywhether »

pydry wrote: post #319
taffer wrote: post #199

Earlier quoted context omitted.

> It would certainly discourage the building of houses in the city centre. No, that's not how it works. The value of a property is made up of the value of the land and the value of the buildings on it. If one of these two components is taxed, its value is reduced. However, it is important to remember that the supply of land is fixed, but the supply of buildings is not. If one taxes buildings, as is the case with a tr…

That's essentially my point. A house in the city center which consumes the same amount of land as an apartment block would face the same tax bill. Who would want that house with that tax bill?

Someone who wants to demolish it and turn it into an apartment building! That’s literally the point of LVT: incentivizing increasingly efficient usage of land in high-value areas.

Re: Dutch cities want to ban property investors in all neighborhoods

#393

Post by imtringued »

kingludite wrote: post #305
refurb wrote: post #201

Earlier quoted context omitted.

The bank is collect money in the future that is worth less than what they leant out today - time value of money. Charging 0% interest means the bank is losing money.

I don't get how people can keep saying this. Is it that people are told banks lend out money from depositors in school? Anyway, if you sign a contract that says you shall pay me every month for 30 years OR ELSE I get to sell your house (and whatever else you own, seize your income etc) then the document with your signature IS the value created and I can sell that document for what it is worth. So the bank creates mon…

The system makes some sense because your fiat isn't completely worthless paper as many people think but there is something missing. It's that promises inherently have a tendency to lapse so we artificially introduce inflation. Well, the problem with inflation is that it requires you to borrow more money so you replace the lapsed promise with an empty promise that is bound to lapse as well. If we were truly serious about letting promises lapse then we would consider having negative interest rates rather than inflation.

Rather than have 0% interest and 2% inflation there would be -2% interest and 0% inflation. Less need for endless debt growth and government stimulus.

Re: Dutch cities want to ban property investors in all neighborhoods

#394

Post by makomk »

nkrisc wrote: post #219
makomk wrote: post #106

Earlier quoted context omitted.

Unfortunately, the British press and all the wealthy people with second homes still have Brexit as a scapegoat for why cafes and shops in tourist destinations can't find staff. Never mind the fact that AirBNB and second homes have pushed up house prices and rents to the point that it's impossible to live there on the kind of pay those jobs have, according to the media it's all the fault of Brexit driving away the for…

>it's all the fault of Brexit driving away the foreign workers who had to do the jobs Forgive me since I’m American, but wasn’t getting rid of foreigners taking jobs one of the selling points of Brexit?

It was, especially getting rid of the kind of immigration that turned blue-collar working-class jobs into something that no-one local could possibly live on. Perhaps more importantly, all the educated influential opponents of Brexit insisted that this wasn't happening, that the idea EU immigration was driving down wages was a cynical lie. I'm pretty sure that it is not lost on most of the supporters of Brexit that the media is trying to spin the fact companies are having to put up wages now we've left as further proof Brexit was based on lies.

Re: Dutch cities want to ban property investors in all neighborhoods

#395

Post by sidlls »

That's a rather extreme response. I don't know what the markets are like in the Netherlands, but I can't imagine the dynamics are much different from other regions where this sort of issue exists. That is, it's a combination of NIMBYism or other supply restricting phenomena and a surplus of investors from outside these communities with the means to take advantage.

In my area on the Peninsula in the bay area, many years easily 25% of the available real estate stock is purchased by foreign investors. Forbidding all investors (local or foreign) from buying real estate to lease isn't going to solve the bigger problem: a lack of supply. It may help lower home prices into a range of affordability for locals (investors and primary residence seekers) substantially--which could be a good thing.

Re: Dutch cities want to ban property investors in all neighborhoods

#396

Post by merrywhether »

refurb wrote: post #216
nmca wrote: post #42

In the long term, the ethically right answer seems pretty clearly to me to be a land value tax [0]. But due to encouragement of home ownership [1], that's not going to democratically tenable in a lot of countries for 20+ years. Unfortunate situation. [0] In 1879, a man asked "How come all this new economic development and industrialized technology hasn't eliminated poverty and oppression?" That man was Henry George,…

It’s a nice theory but it would involve tossing people out of their homes because they can’t afford the tax. If you make an exception for them, then the entire system is defunct because it’ll just be a web of exceptions that just create a “housing elite” that is exempt from the rules. The easier thing is just make is easier to build more housing, denser if needed, to fulfill demand.

Who’s getting tossed out of homes? If they own any part of it, they can sell their land at its new higher value and pocket their share of the gains. Then the can either move into a nearby newly redeveloped multi-unit building (increased efficiency as incentivized by LVT) or they can move further out to land with the same low value on which they used to live in a detached home.

This same type of thinking drives me crazy in CA where Prop 13 exists because someone might have to move because they’ve made a million dollars in house value (simply by existing) that they might have to realize.

Re: Dutch cities want to ban property investors in all neighborhoods

#397

Post by dragonwriter »

galdosdi wrote: post #315
DrBazza wrote: post #194

Earlier quoted context omitted.

> Now sure if you didn't get the education to get a decent job. Hell even on 25k each, Nationwide can lend upto £275k for a first time buyer - just need that deposit. This horrifies me. Even the slightest increase in interest rates will ruin a huge number of home owners. On the other hand, home ownership in the UK isn’t normal either. It’s only since the 50s or perhaps 60s that the average person has been able to aff…

Usually mortgages are a fixed rate for the life of the loan (usually 30 years) -- at least here in the USA. Variable rate (eg "ARM") mortgages are also available but are less common and mostly used for short term flipping and the like, for the very reason you say -- nobody wants to risk a rising payment due to rising rates. Is the situation very different in the UK? Do Britishers actually prefer variable rate mortgag…

> Usually mortgages are a fixed rate for the life of the loan (usually 30 years) -- at least here in the USA.

Note that the very low share of ARMs is a recent (post Great Recession) phenomenon. Prior to that, ARMs were typically a large minority of loans.

https://www.newyorkfed.org/medialibrary/media/research/curre...

Re: Dutch cities want to ban property investors in all neighborhoods

#399

Post by [deleted] »

einpoklum wrote: post #387
IkmoIkmo wrote: post #363

Earlier quoted context omitted.

I don't see the contradiction, could you explain?

If "rental supply drops", that means the people who own apartments they don't live in won't let them out. If they don't let them out, they're subject to the anti-empty-apartment laws.

[deleted]

Re: Dutch cities want to ban property investors in all neighborhoods

#400

Post by galdosdi »

dragonwriter wrote: post #397
galdosdi wrote: post #315

Earlier quoted context omitted.

Usually mortgages are a fixed rate for the life of the loan (usually 30 years) -- at least here in the USA. Variable rate (eg "ARM") mortgages are also available but are less common and mostly used for short term flipping and the like, for the very reason you say -- nobody wants to risk a rising payment due to rising rates. Is the situation very different in the UK? Do Britishers actually prefer variable rate mortgag…

> Usually mortgages are a fixed rate for the life of the loan (usually 30 years) -- at least here in the USA. Note that the very low share of ARMs is a recent (post Great Recession) phenomenon. Prior to that, ARMs were typically a large minority of loans. https://www.newyorkfed.org/medialibrary/media/research/curre...

Ah, makes sense. Low rates, you want fixed. High rates, you want variable. I just don't understand how the bank puts up with it.
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