Housing is at the root of many of the rich world’s problems (2020)

Post by coxmichael » Wed, Aug 17, 2022, 11:10 PM UTC

ThrustVectoring wrote: post #649

coxmichael wrote: post #564

Earlier quoted context omitted.

Again, there’s the idea that wages and businesses produce nothing. They don’t.

Yes, businesses produce actual value. The problem is in what you're diverting from , the ground rents extracted by artificial housing supply constraints. Whether you pay your landlord $X or $Y has zero direct effect on the total amount of real goods and services produced and consumed by the economy as a whole, it's purely redistributive. So if you reduce the total amount of rents paid to landlords, you are enriching…

Post by kelnos » Wed, Aug 17, 2022, 11:10 PM UTC

toss1 wrote: post #416

sbf501 wrote: post #377

Earlier quoted context omitted.

We need a third party to validate both of your claims, because I don't know where to start to understand who is right. This is an example of someone (me) who wants to understand the issue, but would need to google for days to understand both arguments.

The rebuttal by mminer237 is much closer to right [0]. Also it isn't even as good as mminer237 mentions, as many states also have a much lower exemption, and there is work in congress to get rid of the step-up in basis (a bad thing, imo) and to reduce the $12MM lifetime gift & estate exemption (a very good thing). So yes, there are some advantages, but OP is vastly exaggerating as if it is some freebie to landlords w…

Post by kelnos » Wed, Aug 17, 2022, 11:13 PM UTC

robertlagrant wrote: post #558

sbf501 wrote: post #418

Earlier quoted context omitted.

Thank you. > If you want a general complaint, perhaps the angle is that capital is taxed much less than labor, under some notion that lower taxation is necessary to get people with capitol to actually deploy it in investments. Yes, I recall when cap gains taxes dropped significantly during GWB and was, sadly, happy. Of course, I was just a dumb 20-something and didn't realize how much of boon to the wealthy it was.

It's a boon to anyone whose job was created by it as well, and whose life was made cheaper by capital investments in automation and/or scale.

Post by splitrocket » Wed, Aug 17, 2022, 11:16 PM UTC

mminer237 wrote: post #192

idkyall wrote: post #122

Housing in the US has gotten to where it is due to horrible laws effectively allowing total tax avoidance for landlords. Take some investment property. You buy it at some basis price, let's say 500k. You rent it out for 15k a year. Each year you can offset your rental income against deprecation of the property and property taxes - meaning, you pay no income tax on your rental income. ~30 years later, you've deprecate…

You don't write off your rental income. You depreciate the rental property over 27½ years and write that off against your rental income. Few rental properties will have under a 3.7% ROI where depreciation would cover all the income. At best you might be paying half tax. In your example, you'd pay no tax, but you'd lose out on the potential income you could have had with better investments (and lose about 6 years' wor…

Post by psi75 » Wed, Aug 17, 2022, 11:19 PM UTC

AlexandrB wrote: post #195

bombcar wrote: post #80

Earlier quoted context omitted.

People will naturally spend beyond their capabilities, and the entire market is built around this (loans for everything is standard now). The ONLY way to prevent this is to either stop offering loans or force savings in some way (taxes, etc). But apparently both those options are off the books.

Anti-usury laws of some kind might help too. Anything over an effective 25% APR (including one-time fees) seems like a trap. But you're right, there's no political will to do anything like this since consumer debt helps to fuel the economy.