431–440 of 691 posts
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We just need to remember that banning housing investment means banning rentals which is problematic for people who don't have good credit and a down payment.
There are ways to disincentivize toxic forms of investment (especially speculation) without banning it. A high land value tax, for example, would simultaneously increase investment and decrease speculation.
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There is huge value in subdividing land and building, creating housing for people who cannot afford to buy and build. You're stuck in a suburbia mindset. Not everyone can afford a SFH, there isn't enough land. Not everyone can afford to build. Not everyone wants to have massive switching costs when they need to move.
I think most people who are against the rentier economy would agree that there is great value in all of those things, but that they shouldn't be a for-profit enterprise. One way to obtain that value without landlords is for the state to buy land, subdivide it, and build dense housing units available to citizens who live in them at a reasonable, or even subsidized, cost.
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There are reasons for that, but they are generally bad ones involving people not wanting to live near other people who look like the author of the article, even if they won't say that part out loud. Higher density housing is a massive component of building lower carbon footprint cities, as well as making our cities more financially resilient. It's also something that can increase equity a lot by giving people with lo…
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Imagine if housing was cheap enough that paying the mortgage was around the same as what it now costs to rent. There definitely needs to be some rentals, but I believe that there needs to be controls over how many and the rental price.
My mortgage + insurance + taxes is a lower monthly payment than what my rent was at the time I bought my house. Compared to that same unit renting today, its several hundred dollars a month cheaper. It has over twice the square footage and a private garage. This is in a pretty big metro area, not the middle of nowhere. One of the biggest benefit of owning is a hedge against housing inflation. Its not a perfect hedge,…
They're "small" expenses but if you track out the various things and divide them over the ownership period, they do add up.
E.g. - current house, here 5 years, so far: furnace and A/C, $9k, fence, $14k, landscaping and misc, $2k, tools and supplies, $3k, plumber and window repairs, $2k. So about $6k a year, double my taxes and half my mortgage again. And I haven't even hit the big ones (and didn't count appliances as those were "optional" purchases).
Owning is still a good idea for many, and has benefits, and renting will almost by definition be more overall, but it's not a given. You note the main advantage - stability. If you're on a fixed loan (whether it be 5, 10, 20 or 30 years) your payments are calculable years in advance and you get to pay much with tomorrow dollars, which are almost always worth less than today dollars.
But you do have to want to stay in the area for years.
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There is huge value in subdividing land and building, creating housing for people who cannot afford to buy and build. You're stuck in a suburbia mindset. Not everyone can afford a SFH, there isn't enough land. Not everyone can afford to build. Not everyone wants to have massive switching costs when they need to move.
There's a difference between building housing and being a landlord.
Tenants are more than welcome to form LLCs and collectively purchase land and build or buy existing housing. This is called Tenant in Common. Maybe that is a business (non profit) idea for you, make TiC easier.
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Hilarious sure, but also sad and concerning. I'm tentatively alright with the idea of renting forever and never owning property... but with rent increasing and investors buying up more and more property, it looks like things will get uglier and uglier. I am not alright with paying absurdly high rent.
> I am not alright with paying absurd rent. Then you should either: 1) Buy a house to live in 2) Buy a house to hedge against rents going bananas The 30-year fixed rate mortgage at negative real rates is the biggest handout the world has ever seen.
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IMHO cities need to limit how many large multi-national conglomerates are allowed to build huge rental complexes. A large % of the high density housing being built around Seattle is rental only, all that does is funnel money out of the city. Residents don't get to build equity, and rental prices keep going up year over year, vs mortgage payments that, except for the property tax portion, stay the same over 30 years.…
When they don't come in and build out those large rental complexes those very well paid engineers rent/buy every SFH for miles causing the absolutely insane gentrification we've seen in San Francisco that pushes everyone out.
I'm so frustrated by some of the conversations people get in around housing. They want to live in the most desirable places on planet earth, and seem to think that we should just abolish the concept of property ownership to accomplish this. What do you guys think happens when you get what you want, and nobody can "own" property anymore? Do you think there is an unlimited amount of single family 3000 square foot homes…
It is really not that difficult to understand.
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Renting is always worth 0 as equity, so it's a total loss regardless.
* It guarantees you do not lose money if the home values around you drop * It gives you a fixed monthly houseing cost. No "10k new roof" or "1k new stove" suprises hit you. * If you are say, saving 50% vs buying, you can put this difference in an index fund. This would over 10 or 20 years potentially give you a LOT of money over buying. Look, buying is mostly great. It's one of the biggest builders of wealth for most…
2. So does a fixed-rate mortgage. Even better, refinancing a mortgage during a low-rate period (e.g. 2012, 2020) actually lets you reduce your payment, while contributing more to equity. How often do you have an opportunity to reduce your rent?
3. Saving 50% of what exactly? You can put the down payment into an index fund, yes, but remember than the house is an asset that gives you 5x leverage initially, assuming 20% down. You can't get 5x leverage at your broker, and even if you could, playing with 5x leverage on the stock market is insanely risky compared to real estate.
> But from a purely numbers game, it's not so clear "rent is just losing money"
It's pretty clear actually. They've compared retirees who rented all their life vs home-buyers. The difference in wealth was striking, a factor of 6x-7x if not more.
What's not clear is whether that trend will continue in perpetuity under the conditions of declining population.
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> it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater. What is those people's second biggest purchase which is also usually done with debt? Does anyone believe that the government should enact policies to ensure that car prices always increase so they would be a better investment?…
The goal should probably be something close to price stability . If prices bounce all around, up and down, people pay more attention than if they were just kind of 'there', and you could buy or sell whenever the need arose in order to move into housing that better suits you at a given point in your life.