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Ask HN: Anyone else feels the commoditization of real estate is unethical?

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Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#501

Post by ItsMonkk »

theplumber wrote: post #310
targ65 wrote: post #172

Like another comment here mentioned, housing is complicated. People don't want to live in a random house in the middle of nowhere ('roof over your head'). Some people prefer to be homeless on the street versus getting to a roof over their head that they don't like. People want to live where they want to live (near family, jobs, culture etc) Take NYC for instance. Politicians try to address the NYC housing crisis from…

It looks like you can't see the real issue: too many people want to live in NYC. If you make it cheaper to own, build or rent in NYC even more people will come and the there will not be enough housing. Perhaps people should be encouraged to live somewhere else/in more places? Living in NYC is not a human right either.

The existing paradigm creates extremes. We have Manhattan filled with 40-100 story skyscrapers, then we have the other boroughs with much less. We've got suburban NJ, CT, and NY. If those areas stopped their restrictive zoning policies, and allowed building more density, then the people who wanted to live in NYC could do so, and the people who wanted to live near NYC could do so.

When you take a look at Tokyo, who have had stable housing prices, and have a sane zoning system, what you see is that people can live where they want to live. Yes you have some skyscrapers. But you also have many places that aren't.

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#502

Post by ambientenv »

It comes down to our dominant, collective set of values as a humanity. And our dominant values centre on the accumulation and leverage of material/financial wealth. It is the playground of the already wealthy, the aspiration of the vanishing middle class and the dream of the so-called less fortunate, the catalyst of the VC world. (Yes, I'm using broad strokes, but it is dominant, not the only). You are classed by it, judged by it, pigeon-holed by it. Most if not all of our current challenges, be they environmental, climate, ecological, economic, cultural, social, governmental have, at their root, a pursuit of unconstrained material wealth (and unlimited growth and productivity). SO why wouldn't enterprising souls in pursuit of such things see real estate, not as a human right, not as a basic need, not even just a family- or community-centric place to thrive and flourish and be fulfilled in ways other than the accumulation of financial wealth, but simply another "investment" (no matter the external and extraneous accumulative costs) from which to prosper.

Until there is deep enlightenment, until our capitalist-centric values change, until we (the majority we) rise up and say enough and are willing to change our own worldview and our own values in support of "enough is enough", these behaviours will continue to be rewarded and idolized (though many of us believe a forced readjustment, possibly catastrophic, is on the immediate horizon).

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#503

Post by [deleted] »

ItsMonkk wrote: post #333
nrmitchi wrote: post #276

Earlier quoted context omitted.

The biggest thing missed when proposals like that is that not everyone wants to (or does it make sense to) buy a property. Making it 4x more expensive to own a rental property means that rent will be 4x more expensive for those that have to rent. If I was moving to NYC for 6 months, or 2 years, there’s no way I want to spend tens of thousands of dollars buying-and-then-selling a property.

Not true, but I'm a Georgist so would be against the GP's targeting non-owner tax. Tax everyone according to the value of the unimproved value of their land. I can show you plenty of places with $3k+ rents in SF with prop 13 property taxes that have not changed their tax meaningfully in decades. Taxes have absolutely no effect on what the renter pays. The tenant is always paying the land value. It's just going straig…

[deleted]

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#505

Post by closedloop129 »

snapplebobapple wrote: post #446
closedloop129 wrote: post #264

Earlier quoted context omitted.

> because city governments zoned everything wrong for the actual demand This is the core problem. Commoditization, or rather, people cornering the market is secondary. City government is doing this because it is elected by those who own single family units. This is self-stabilizing. If the majority would live in multi residential highrises, there wouldn't be an incentive to artificially create scarcity. Instead, ther…

Your last statement is not correct. People like to invest where they can make money and multi residential rent is profitable in most places and we have REITs and other financial instruments ready to grow and invest lots and lots into multi residential rentals to generate a decent cash flow to send back to investors. The problem for them now is that there is so little land zoned that way that these guys are often outb…

Regarding my last statement: People like to invest into multi residentials now, but are those investments still profitable when the zoning changes?

How do you protect your investment when there is innovative pressure and housing units compete on price? Say you have a building and you try to monetize your investment over 20 years but after ten years, due to innovation, competing units can be built for half your costs. Then your tenants will move if you don't halve your rent which destroys your profits.

In a city with nimby's, that's never a problem because rent remains high, even if costs are reduced.

>All we need to do is force cities to zone land this way

This requires the vote of the nimby's which means that you need other options.

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#506

Post by RHSeeger »

bwestergard wrote: post #399
targ65 wrote: post #172

Like another comment here mentioned, housing is complicated. People don't want to live in a random house in the middle of nowhere ('roof over your head'). Some people prefer to be homeless on the street versus getting to a roof over their head that they don't like. People want to live where they want to live (near family, jobs, culture etc) Take NYC for instance. Politicians try to address the NYC housing crisis from…

"get rid of unions" I am as YIMBY as they come regarding zoning, but this is a complete non-sequitur. It also shows a casual disregard for basic republican values: the right to freely associate and to withhold one's labor. An international comparative perspective, as well as a regional perspective, do not suggest that construction union density can explain the widespread housing affordability crisis in the U.S. Only…

>> get rid of unions

> I am as YIMBY as they come regarding zoning, but this is a complete non-sequitur. It also shows a casual disregard for basic republican values: the right to freely associate and to withhold one's labor.

It does no such thing. Rather, it's noting that unions raise the cost of many things they are associated with; especially construction. The value added by the union being in place isn't being questioned (or even commented on). Just the fact that they add cost.

The same is true of safety regulations. Those regulations (generally) add a lot of value by keeping people safe/alive. But every safety regulation _also_ adds to the cost. Pointing out that they add to the cost in no way belittles their benefit or the desire to have them.

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#507

Post by jandrewrogers »

rojobuffalo wrote: post #444
joshlemer wrote: post #408

Earlier quoted context omitted.

As others have said, this is an absolutely terrible idea and highly destructive to renters. There is simply no reason to boogeyman real estate investors so long as they are renting out the property. Renting is no less valid a form of housing than ownership and policies like you describe are already in place in many jurisdictions such as Ontario and it is already as we speak harming renters. For all the people saying…

> Renting is no less valid...than ownership I think ownership is better because people value securing the shelter where they sleep. Renting is worse because you can't make decisions about how to improve land and architecture. You are only permitted to be there under a limited contractual agreement vs. being able to stay put until you decide to sell.

Many people expressly do not value the things you claim, you are projecting your preferences on to people at large. Renting transfers many costs, risks, and hassles to the landlord, which is a desirable arrangement for a significant percentage of people. It is not uncommon for people to strongly prefer renting even when they can easily afford to own a place to live because it is a better use of their time and money.

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#508

Post by AYBABTME »

rojobuffalo wrote: post #257
targ65 wrote: post #172

Like another comment here mentioned, housing is complicated. People don't want to live in a random house in the middle of nowhere ('roof over your head'). Some people prefer to be homeless on the street versus getting to a roof over their head that they don't like. People want to live where they want to live (near family, jobs, culture etc) Take NYC for instance. Politicians try to address the NYC housing crisis from…

I would start by making property taxes substantially higher for non-owner-occupied property. If you are rent-seeking rather than residing on the property you should pay way more, maybe 4x or higher, in taxes. Housing prices would crash and that would be the point; but everyone who owns property would be against it because they don't want to see their assets drop in value. The counter-argument people make is "that wou…

This falls flat on its head when you consider that this would force a bunch of people in becoming small time landlords, with the inability to invest in their skills and competency by scaling up to multiple properties. Barely anyone would be interested in running multi-family real estate and they would migrate to commercial real estate. What would remain for residential is low density condos and shitty small time landlords with variable understanding of the expectations of their role, and variable notions of what's legal and what's harassment. Anything high density is too expensive (in time and capital) to do as a "coop" style endeavor and this means no high density residential would occur unless its luxury and expensive rent, to make up for the substantially higher taxes.

I'm sorry but you can't make more housing appear by simply raising the barrier of entry and throwing sticks in $INSERT_EVIL_GROUP's front bicycle wheel. Ultimately, things need to be cheaper and easier to build, and this will come at the cost of some people's freedoms (expropriating their land for redevelopment, displacing people for redevelopment, preventing bike shedding about neighbors' preferences).

It's easy to take a dump on so called rent-seeking landlords. But picture yourself becoming a landlord; imagine you're this newly minted, high spirited multi-family property owner and you want to do good for your neighborhood without becoming a charity and ruining yourself. Then look at what your options would be. In many US urban areas, there's already a lot of regulation in place that would drive you mad in your inability to make things better for your tenants and yourself in a sustainable manner. The rules literally push you into what you're seeing in the rental market (crappy apartments with high rent).

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#509

Post by ethbr0 »

RHSeeger wrote: post #464
rojobuffalo wrote: post #444

Earlier quoted context omitted.

> Renting is no less valid...than ownership I think ownership is better because people value securing the shelter where they sleep. Renting is worse because you can't make decisions about how to improve land and architecture. You are only permitted to be there under a limited contractual agreement vs. being able to stay put until you decide to sell.

You are welcome to think that. But it is an opinion, and not one shared by everyone. Both are equally valid options; in my opinion. I've been in times of my life where owning was better for me. I've been in times of my life where renting was better for me. At the times I was renting, I was very grateful for the landlord I had at the time (mostly; I've had a small number of landlords I did not like); they take on the…

People tend to talk about two different things when they say renting: control and affordability.

Anti-renting people emphasize the control inherent in the relationship. Landlord sets the rules, including price; tenant required to abide. (Attempts to address the market by regulation here have had their share of severe side effects)

Pro-renting people emphasize the affordability and ability to offer housing to those without access to the capital to purchase, as well as the shift of asset risk (physical and market) from the renter to landlord.

The central evil seems not the existence of renting, but the ability of a landlord to capture underlying asset appreciation and charge rent.

Coupled with areas of constrained supply, this leads to landlords getting richer and renters... not. Which seems unfair.

Re: Ask HN: Anyone else feels the commoditization of real estate is unethical?

#510

Post by ItsMonkk »

tharkun__ wrote: post #493
ItsMonkk wrote: post #460

Earlier quoted context omitted.

If I sent you a picture of a home, and I asked you what it was worth, you wouldn't be able to answer me until I first mentioned it was in the middle of SF or if it was in the middle of the Arizona desert. The majority of urban values are not the value of the improvements but the value of the land. The value of the unimproved value of land comes from your neighbors. It comes from your city. When roads and sewers and t…

If I sent you a picture of a vacant piece of land in the middle of New York City's best neighborhood and asked you what it was worth, could you answer me? You wouldn't be able to until I told you what kind of home you are allowed to build. If I only allow you to build a shack or make it a park you won't be able to extract any money by renting it out and thus you wouldn't buy it at any price, even though the neighborh…

Yes, land use is one factor.

What is interesting is that the dynamic actually flips once there is adequate zoning. Take a look at this[0] video on Tokyo zoning and how he talks about living in an industrial zoned area. He talks about how it's cheaper to do so, and if you want to move to a single family zoned area, it's actually more expensive!

Under the current system, landowners want their own land to be zoned as high as possible, while they want everyone else's land to be zoned as low as possible. Since 1 This is a system with proper incentives.

[0]: https://www.youtube.com/watch?v=wfm2xCKOCNk

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