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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWhy not outlaw landlordism?
Consider for a moment: What would happen if real estate could not be rented, leased, or borrowed against, but only either bought, sold, or used by the owner?
An obvious initial objection would be "But most people can't afford to buy real estate!" Then a beautiful thought occurs: Because they can't afford it, and the owners can no longer rent it out, lease it out, or borrow against it, owners have only two ways to make money from it - either sell it or use it as productive capital that creates jobs.
Since the vast majority of people - including (in fact, especially) real estate speculators - have no interest in or capacity to run a productive enterprise, the only practical avenue of profit for most real estate owners would be to sell the property. If they have no personal or professional use for it, they're only in it for the money, and they can't make money on it except by selling it, then that is what they will do.
So what happens when people with property want to sell it, but consumers can't afford to buy it? The price goes down. And without the hugely inflationary forces of bubble-speculation and landlordism, it would go down massively. It would go down as far as necessary for people to afford it, resulting in a huge redistribution of wealth back to the average person.
Sure, some holders of surplus real estate would try to hold on to their property and wait for a more favorable market, but unless owners acted as a single giant monopoly, enough would sell that the price would just keep going lower, causing still more to sell to avoid future losses. The price would then stabilize far below what it is in a market supported by renting, leasing, and borrowing.
Also, since you can't borrow against it, homeowners would be less tempted to use their property as a cash machine, meaning they would be more likely to hold on to it in the long-term.
Pass the law such that it unfolds gradually, so that present renters are not thrown out on the street, and I don't see a downside.
Thoughts?
(Edit: Wow, I didn't realize I was thinking so far outside the box here. It just seems like common sense that the tenant-landlord relationship is a fundamentally Bad Thing for society and democracy, given that it reduces a "free" market into a medieval Manorial estate. This should not be a radical idea on a liberal discussion forum. Be less conservative and more thoughtful about how things can be better, folks.)
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pscot
(21,024 posts)
True Blue Door
(2,969 posts)pscot
(21,024 posts)From the Magna Carte through John Locke. The Constitution is all about property. It runs deeper than religion.
True Blue Door
(2,969 posts)And government obviously has the authority to regulate commerce under the Commerce Clause.
pscot
(21,024 posts)True Blue Door
(2,969 posts)Not unless you define regulation as violation, in which case the position is once again Libertarian.
Nuclear Unicorn
(19,497 posts)True Blue Door
(2,969 posts)Nuclear Unicorn
(19,497 posts)is set by the states, not the feds. Even many out-of-state corporations take advantage of the fact states set their own corporate law.
Fantastic Anarchist
(7,309 posts)Property rights have nothing to do with freedom (I know you say "Liberal governance," but I'll infer that what you mean is liberty. If I'm wrong, feel free to correct me.
If I'm correct, then property has nothing to do with freedom.
FreeJoe
(1,039 posts)Are there (or have their recently been) countries that don't have relatively strong property rights that still enjoy political and personal freedom?
ieoeja
(9,748 posts)Many of the western States are predominately socialist. Miners and ranchers make extensive use of public property out west.
Some of the First Nations in the United States had strong property rights. But most did not. And they had a great deal of political and personal freedom. More than we ever did, I would say.
FreeJoe
(1,039 posts)You are calling the western states predominantly socialist, presumably because they have large amounts of federal property, despite the fact that their economies are dominated by private companies conducting business in free markets. Your other example is some vague reference to some of the original colonies. I don't find any of this convincing. I'm going to stick with my view that property rights appear to be a necessary condition for political and personal freedom in a modern nation.
ieoeja
(9,748 posts)Private companies conducting business in free markets where the means of production (aka, the property) is owned by the government *is* socialism.
Cliven Bundy is a socialist. He is free to deny it all he wants. The fact that he is too fucking ignorant to understand that he is championing socialistm does not change that fact.
Some of the First Nations in the United States had strong property rights. But most did not. And they had a great deal of political and personal freedom. More than we ever did, I would say.
First Nations are the various Native American nations. Thas was not "some vague reference to some of the original colonies". Most of the pre-Columbian cultures in the United States held property communally. And their personal freedom made ours look non-existant.
PatrickforO
(14,558 posts)the industrial revolution, when landlords began privatizing common land which squeezed everyone and helped make out economy into the s**thole that it is.
It used to be that people could farm and hunt on common lands, and we didn't have much hunger when we could do that.
Bring back the commons and we'd be pretty good. Get rid of the idea that we can 'own' land and we'd maybe better off, but I still have a hard time getting my head around that.
cheapdate
(3,811 posts)Land ownership is an arrangement between the land "owner", the state, and the rest of us. The sovereign, perpetual state guarantees the "owner's" claim to have exclusive control over a piece of land -- forbidding, as he chooses, all others (the rest of us) from setting foot on, or using that piece of land forevermore. The "owner" didn't create the land -- it was there before him.
All this bullshit goes back to Roman concepts of modes of "natural acquisition", such as acquisition by discovery, occupation, or by civil means. None of that makes it right. There's nothing inherently "natural" or right about it and there's nothing inherently wrong or right about other systems of land use.
At the very least, in exchange for "the rest of us" agreeing to recognize the "owner's" claim to exclusive use and control over a piece of land -- which he didn't create and which was there before him and will be there after him -- the owner might be required to compensate the public (i.e. the rest of us) on an ongoing basis.
There's nothing inherently right about denying me the right to simply walk down to the riverbank for a drink of water because some rich family somewhere claims to own all the land along the river. It wasn't right in England when "Lords" claimed to own vast areas of the countryside and it's not right now.
Ace Rothstein
(3,140 posts)We call it property taxes.
cheapdate
(3,811 posts)
eridani
(51,907 posts)At the time it was written, human beings could be property. If we could then legally say that people can't be property, why can't we say that land also cannot be property?
Personally, I'd take it farther than that--no individual may have property rights in anything that was not made by the hands of men.
Reach out your hand if your cup be empty,
If your cup is full may it be again,
Let it be known there is a fountain,
That was not made by the hands of men.
Houses can be property, but land can't. Water purification hardware can be property, but water can't. Etc.
Fantastic Anarchist
(7,309 posts)Scootaloo
(25,699 posts)Nuclear Unicorn
(19,497 posts)True Blue Door
(2,969 posts)
jonno99
(2,620 posts)True Blue Door
(2,969 posts)geek tragedy
(68,868 posts)is a regulatory taking, especially when that reduction in value is by design
True Blue Door
(2,969 posts)Grandfather in the situations that merit it.
The point is that I still am not hearing any fundamental economic problems with the idea.
jonno99
(2,620 posts)the idea that "private property [shall not] be taken for public use, without just compensation".
IOW - your idea would have an extremely difficult time passing constitutional muster.
Bottom line: people "pretty much" get to do what they want - with their stuff (do you want someone telling you for how much - or to whom or when - you sell your bike, car or phone?)
True Blue Door
(2,969 posts)I'm not a libertarian and neither are the vast majority of the people here, so I'm not interested in objections based on nothing but terror of "Big Gubmint" making economic decisions like it's been doing since 1933.
The main objection I'm hearing is that this would indeed work and have the desired effect of redistributing wealth.
jonno99
(2,620 posts)I'm curious - have you ever owned any property - just a house?
What makes you think that everyone who is now renting is suited to - or even interested in - owning a piece of property?
True Blue Door
(2,969 posts)Either someone can come up with genuine fundamental objections or not, but so far what I'm hearing is the following:
1. Big Gubmint! (Don't give a shit.)
2. It would throw people out on the streets! (Nope - already addressed that many times. There would be fewer homeless without landlordism artificially inflating the costs of living, and there are vast, easily imaginable options to mitigate disruption to renters.)
3. It would reduce revenues from property taxes! (Nope - people with x income can afford y dollars worth of property, and will buy that much property regardless of whether it's a giant mansion or a small condo, so the revenue they contribute would stay the same over the long-term, if not increase with rising general prosperity).
4. What about (insert specific case)?!?!?! (Doesn't address the fundamental idea, just asks how to write specific legislation, which is way beyond the scope of whether the idea is basically sound. Similar objections could be raised to every single law that's already actually on the books.)
Reality.
jonno99
(2,620 posts)have you ever owned any property - even just a house?
Also, what about those folks currently renting who are not suited to - or even interested in - owning a piece of property? These are not small groups.
True Blue Door
(2,969 posts)As to your "what about" special case - which, as mentioned, is a question for specific legislation rather than a fundamental idea - nothing would stop someone from paying for services to manage the details for them.
That could make things as easy - if not easier - than renting, but without the medieval Manorial power relationship: The manager handling your assets would be a provider of services to the owner and have minimal leverage, not another owner demanding extortionate rents for allowing use of a commodity you can't do without and is in fixed supply in a given area.
jonno99
(2,620 posts)As I've stated elsewhere on this thread, property "ownership" is a financial risk - and not a small risk.
There are many people who are neither suited, ready, able - or even interested in owning property.
For instance, those on fixed incomes will only be more financially stressed by having to manage the week in, week out, wear-and-tear costs associated with maintaining a (most likely older) house.
I understand that you are hoping to do away with the "medieval Manorial power relationship", but I think your efforts would be better spent dealing with problem landlords than with exponentially increasing the difficulties of the folks you are targeting - to help.
cherokeeprogressive
(24,853 posts)Wouldn't that violate the Equal Protection Clause?
FreeJoe
(1,039 posts)Look at California after Prop 13. People pay radically different property tax rates. If I bought a house 40 years ago and you bought the one next door today, you will be paying several times as much in property taxes for property valued the same as mine. That always struck me as unfair, but given how long it has gone on, I am assuming that it is constitutional.
cherokeeprogressive
(24,853 posts)This poster is talking about a "compensatory tax deduction" for some, and not for others.
FreeJoe
(1,039 posts)My understanding is that people that finance their homes get an interest deduction but renters and homeowners with no mortgage do not. People with health insurance don't pay the Affordable Care Act "tax".
Nuclear Unicorn
(19,497 posts)Just because you pass laws to make it lose market value to them doesn't mean it isn't a seizure. I'm sure if someone passed laws making the use of the internet prohibitive to you you would probably consider that being deprived of the use.
And you would have to pass a lot of contorted laws to do it.
Of course, all those tenants still need property so that will elevate the demand. Per Economics 101, high demand and limited supply leads to price inflation.
And that's assuming the former leasing tenants want to be buyers and that assumes the banks want to loan to them. I don't care how much you use the law to destroy property values you're never going to get the price as low as a month's rent --which is why most renters rent.
pnwmom
(108,955 posts)that people could no longer use their properties in the way they chose.
jonno99
(2,620 posts)True Blue Door
(2,969 posts)pscot
(21,024 posts)True Blue Door
(2,969 posts)If there were, laws against running pig farms as brothels would be unconstitutional.
Response to True Blue Door (Reply #23)
jonno99 This message was self-deleted by its author.
Nuclear Unicorn
(19,497 posts)You have no right to your house granted in the Constitution. The Constitution forbids the government from keeping your house from you. You are then free to use and dispose of your house as you see fit, including renting it -- if that is what another party freely chooses to do.
True Blue Door
(2,969 posts)That is literally what this idea concerns.
Nuclear Unicorn
(19,497 posts)Adrahil
(13,340 posts)The idea of inherent, natural, or unalienable rights was all the vogue in the 18th century, but honestly, unbless you can show me a list of such rights somewhere, the concept is not very useful.
Uncle Joe
(58,272 posts)
Yupster
(14,308 posts)to grant specific rights to the federal government with all others not mentioned belonging to the states or to the people.
Many people read it backwards thinking the federal government has every right unless specifically granted to someone else.
BeyondGeography
(39,341 posts)
True Blue Door
(2,969 posts)NCTraveler
(30,481 posts)That statement is one hundred percent the exact statement you made in your op.
LittleBlue
(10,362 posts)Sellers often set a minimum price below which they won't sell. Supply and demand curves don't work like that.
You would be creating a nation of homeless people by fiat.
True Blue Door
(2,969 posts)LittleBlue
(10,362 posts)The assumption that people will sell at whatever the market dictates is false. That includes labor, which can reach prices below which people won't work. The same is true for selling property.
True Blue Door
(2,969 posts)That rich people would rather make no money at all than make less money than they prefer. That's not how markets or the humans that create them actually work.
But if you mean the issue of people buying before the law is passed and losing money, that's a simple fix: A tax credit to compensate the difference, as well as whatever other grandfather clauses make sense.
LittleBlue
(10,362 posts)There is a wage below which people have too much pride to work, or the returns simply aren't worth the effort. The same is true for housing.
Rich people aren't forced to sell because they have money. Most won't have to immediately liquidate unless rentals are their only income. People in the 1% generally have portfolios beyond one kind of asset, not to mention their salaries wherever they work.
The rich would feel the pinch in one portfolio while renters would be homeless and destitute. You think Section 8 recipients can afford a home at any price? They wouldn't be able to afford one even at $5,000, which is far more than they could ever afford but far less than any landlord would sell his property. $5000 for a member of the 1% is a pittance compared to what they make elsewhere. You can see from this example that rich people don't need such a small sum with any urgency.
Anyway I'm glad you made the thread, these discussions are always interesting to see everyone's views.
True Blue Door
(2,969 posts)The market would become commoditized, meaning that the prices would never go back up even while volumes and revenues were steadily increasing. Sooner or later, when that is realized, the choice is between selling or just never realizing value from the property.
geek tragedy
(68,868 posts)1. No more apartment buildings would be built, ever.
2. Which would mean more urban sprawl, more carbon consumption, more habitat destruction for wildlife, etc.
3. people who are currently renting would be prisoners in their own homes, literally. They couldn't move, because then they'd be homeless.
4. You'd screw every single homeowning household in the country, since they owe mortgages on the properties they own. Massively devaluing their homes, on purpose, amounts to theft.
Sorry, this idea is so stupid it makes my head hurt.
True Blue Door
(2,969 posts)Wrong. They would sell the apartments rather than renting or leasing them.
2. Which would mean more urban sprawl
You're saying it's a good thing that fewer and fewer people can afford to live where they want?
more carbon consumption
Until we fix our environmental policies, more prosperity will inevitably mean that. So are you saying poverty is good until we develop a totally GHG-free economy?
more habitat destruction for wildlife, etc.
Same deal as with GHGs. If people have more money, they can afford to be more environmentally conscious.
rogerashton
(3,920 posts)It would no longer be profitable to build houses, so no more would be built. Nor would it pay to repair and keep up the ones in existence, if they must anyway be sold very cheaply in the foreseeable future. So, in the "long run" -- long enough for the houses to deteriorate -- there would not be houses for the former renters to live in.
"In the long run we are all dead" -- but that doesn't apply in this case, I think.
True Blue Door
(2,969 posts)First, I don't think we know exactly how far prices would fall, so it's premature to say that building houses even with current practices would fail to be profitable - we can only say that it would be less profitable. And let me reiterate that other part: Less profitable with current practices.
Secondly, since plenty of people can already afford to buy houses, that's not going to go away - the people who buy houses now to live in themselves would just buy bigger ones (or more of them) under the lower prices, so the profits they represent would not disappear. Only the profits related to purchases made to make money rather than utilize the property themselves would go away - i.e., speculation and renting.
Thirdly, higher-volume sales create economies of scale that reduce input costs, and that would at least somewhat offset the reduction in profits. As a matter of fact, it may not be the case that builders would experience any loss of profit at all - merely real estate companies, speculators, landlords, and other middle-men between the product and the end-user.
Plus, since more people own the homes at a lower price, and aren't losing money on rent, people have more to spend on repairs and maintenance.
Basically I think you're over-generalizing one part of the real estate economy to the entirety of it.
jeff47
(26,549 posts)Last edited Tue Aug 4, 2015, 08:46 PM - Edit history (1)
Depending on where you live and the size/extravagance of the house, the materials to build a new house cost between $30,000 and $500,000.
That includes zero labor. And your proposal bans financing those costs.
Yupster
(14,308 posts)and we're going to have to pay about $ 8,000 for a new unit.
Move that to a poor person who just bought a home for every dollar they have and the first large repair will leave them in desperation.
Every homeowner knows there's always something going wrong in a home.,
Many people are way better off renting.
Juicy_Bellows
(2,427 posts)True Blue Door
(2,969 posts)The point would be to change how things are done going forward, not penalize anyone for profiting under the prior system.
hack89
(39,171 posts)as property taxes plummet. Taxes are based on the value of the property. You would drastically reduce the value of a lot of property.
True Blue Door
(2,969 posts)If you include tax credits and other mitigations so that people are not penalized for buying before the change, then people who own today would simply buy bigger houses (and/or more of them) under the lower prices. Their income is the same, so the value of the property they can afford is actually constant - meaning no net reduction in property tax revenues.
Don't get me wrong, the money would move around geographically - that's inevitable, and happens naturally anyway. Opposite trends like urban blight or gentrification happen. But the newly-created low-income homeowners would have more disposable income because they're not being milked by landlords, allowing them to spend more and stabilize the value of their new communities, while prior owners would move up the economic ladder to better locations.
By and large that sounds like a win-win. Certainly more than the current trajectory of wealth in this country.
hack89
(39,171 posts)because their mortgages are more than the value of their homes. You would lock owners into their present homes - they can't afford to sell and realize a massive loss.
True Blue Door
(2,969 posts)hack89
(39,171 posts)where is that money going to come from?
Amishman
(5,553 posts)Crash property values by a 1/3rd and suddenly we need to find an incredible amount of money to blunt the impact
True Blue Door
(2,969 posts)A few times more than the cost of the F-35 fighter.
Any claim the money isn't there is laughable.
True Blue Door
(2,969 posts)yeoman6987
(14,449 posts)I've rented and bought. Renting is cheaper overall. One day your furnace breaks, the air goes out, the water heater leaks etc. I have poured more money into the house over the years then some landlord could wish for and that happens to all homeowners.
whatthehey
(3,660 posts)If you think rents aren't set to include maintenance, repair and upkeep, you're assuming all landlords are either imbeciles or altruistic to a saintly level. Renters pay for all that just not in discrete chunks.
jonno99
(2,620 posts)ownership is a RISK. Many folks - especially those on fixed incomes - are not willing to assume the risk.
Moreover, when a new furnace is needed, those on a fixed incomes most likely will not be ABLE to come up with a "discrete chunk" of money.
And when the basement floods the renter can walk away. The owner? Nope...
Ms. Toad
(33,992 posts)If renting was cheaper than owning, there would be no no homes to rent. Landlords are not renting out of a sense of altruism - they are doing so because it is proftable. I.e. Owning + profit = rental cost.
As an owner there are more expense spikes, which can be harder to manage from a cash flow perspective - but those spikes don't change the basic economics that landlords charge rent which is higher than the cost of owning the property outright.
ieoeja
(9,748 posts)Few States had much in the way of an income tax. When the Great Depression came along, it delivered a double whammy:
1. People who were no longer making money, could not pay taxes, so they lost their land which deflated property values.
2. Those who could still afford property taxes paid less as their property values deflated.
With an income tax, problem #1 does not exist. I will never, ever be able to understand Conservative preference for non-income taxes over income taxes. It doesn't make a lick of sense. Taxing people according to their ability to pay the tax is not only more fair, it is also the only thing guaranteed to work under any economic condition. We saw that in the Great Depression. Only those still making money could actually pay the damn taxes, but States were going bankrupt taxing people who couldn't afford taxes instead.
I can understand Conservative logic on a lot of things. But this one has always boggled the mind.
If people aren't making enough money to pay property taxes, they aren't going to be paying much in the way of sales taxes (they will buy less) and they won't be paying much in the way of income taxes either. All tax collections will go down in a Great Depression.
ieoeja
(9,748 posts)The States were still going to see a decrease in income. But their reliance on property taxes meant that they:
1. Made things even worse for the people.
2. Made things even worse for the State as the State was taxing people who could not pay instead of taxing those who could. Any of the 75% who did not lose their job during the Great Depression, but who rented, were no not being taxed. Because the States relied on property taxes instead of income taxes.
Look at what happened during the recent Great Recession. Millions of former home owners are now renters. The only thing that saved the States this time around is that most of that property ended up being foreclosed on by banks.
This was a huge change in the way banks work with regards to real estate. In the past the last thing banks wanted to do was foreclose. They are banks, not real estate companies. With the repeal of Glass-Steagal coupled with the growth of the hedge fund culture, banks are now just one investment for hedge funds. So the banks were told to foreclose then "sell" the property to a real estate company in which the hedge funds are invested.
This was fortunate for the States because they continued receiving property taxes from the real estate companies instead of the former home owners. But for we the people, this collusion between businesses led to a lot of people being foreclosed where in the past the banks would have been more willing to work on lowering payments, extending time, etc to avoid that foreclosure.
1. In many states, the state income and sales tax are the primary revenue generators with property taxes left to the counties and municipalities.
2. Even for the well-to-do, income tax collections dry up in depressions/recessions because they do not earn capital gains. Take a look at the drop in cap gains tax receipts caused by the dot bomb bust in 2001 and the 2008 collapse.
3. People that are renting do pay property taxes indirectly. All landlords pass through their property tax costs to the renters.
4. Banks do prefer to work with borrowers if they can see a way for the borrower to catch up and become current over a reasonable period. The real estate bust was so spectacular, the little or no down mortgages so prevalent, and the loss of equity so great that the banks and borrowers had little to work with in reaching plans to work out the loans.
ieoeja
(9,748 posts)Several banks have had to pay trillions in fines precisely because they illegally foreclosed on a lot of homes during this downturn. So it isn't a theory of mine that the banks were doing this.
I imagine most banks still prefer avoiding foreclosure. But the big guys who combine commercial banking with investment banking clearly wanted to foreclose to satisfy the investment side.
1939
(1,683 posts)1. The banks were going to foreclose
2. During the feeding frenzy of the real estate bubble, they were creating unstable loans which had a high chance of foreclosure
3. The banks then sliced and diced those shaky loans into a large number of "mortgage tranches".
4. The paper trail on who or what was the "holder in due course became murky.
5. Instead of properly reconstituting the paper trail before they foreclosed, the banks falsified and forged some paperwork to get the job done quickly.
6. The acts of foreclosure weren't criminal, it was the shoddy paperwork used that was criminal.
SheilaT
(23,156 posts)What would happen to all those currently renting? Many of whom prefer to rent? What would happen in NYC, for instance, where there aren't all that many single family homes, but thousands upon thousands, hell, maybe millions of renters?
Personal example: When I moved to my current city seven years ago, I rented for a year before buying the place I'm currently in. Are you suggesting I should have been obligated to buy immediately? Or paid hotel rates for that year? Seriously?
Not to mention, in that year housing prices came down and my own financial situation turned out not to be as rosy as I'd hoped. Had I bought immediately, I'd have bought a place I could not have actually afforded. How in the world would that have ended? I'd have been foreclosed on, and unable to buy something else, and there would have been no where for me to rent.
Even if done gradually, at some point there will be no rental housing of any kind available. To anyone. Think about it. Someone who wants to simply try living somewhere to see if it's the right fit, say in retirement, won't be able to rent for a while.
Truly a bad idea.
True Blue Door
(2,969 posts)Specific cases like you describe would be dealt with in the language of actual legislation, and it's not hard to imagine graduated implementation, mitigations, credits, grandfather clauses, etc. so that as much as possible the benefits are widely distributed and no one is penalized for decisions made under earlier rules.
Someone who wants to simply try living somewhere to see if it's the right fit, say in retirement, won't be able to rent for a while.
Since sales would be cheaper and higher-volume, the process of purchase and sale could be streamlined to let it move more quickly. The point is to democratize real estate by removing the single most pernicious economic relationship in modern marketplaces, landlordism.
SheilaT
(23,156 posts)people who want to move, or who have a temporary posting somewhere, such as in the military, would be able to buy and sell that easily and cheaply.
How about travelling nurses? That's a category of people who travel around the country, working typically for six months in a given city, then move on. Do you SERIOUSLY believe that buying a home for only six months is economically feasible? Maybe for realtors, but not for actual home owners.
How about college students? Many, many most colleges and universities don't have enough student housing for all their students. Again, you're suggesting someone buy a home for four years, less if the student drops out or is in a dorm the first year or two.
The need for rental housing is not going to go away with your proposal. Nothing can be grandfathered in or done so slowly that ten or forty or a hundred years from now there won't be people who will need or want to rent, rather than buy.
There's not a problem with the cost of housing being manipulated by evil people who hold back property. Yeah, some landlords are scum, but by no means all. Much, much more to the point, owning a home is not a sensible thing for every single person, and ideally, every single person needs a place to live.
I can't begin to figure out why in the world you think that this thing you call landlordism is such an impediment to home ownership. Maybe it would be nice if more people could own their own homes, but if you honestly think that every single person should own, there should be no rentals everywhere, then you live in a strange fantasy world.
Yupster
(14,308 posts)The ability and need to rent is such a natural economic need, that it won't go away.
Traveling nurses would stay in apartments that will now be labeled as hotels.
Same with anyone else wanting to rent. All of the sudden millions of hotels that charged by the month would crop up.
Also, millions of people would stay in other people's homes. They wouldn't pay rent. They'd just be free visitors who would pay a monthly charge for upkeep of the property. The monthly cost would absolutely not be called rent.
You just can't do away with laws of economics.
It's like when I was a college history major and communism sounded so good. Then you realize how there's no way it could work, and how in every case it's been tried you end up with bayonets trying to make people work.
Reter
(2,188 posts)I live paycheck to paycheck, I can't afford a house.
jonno99
(2,620 posts)whatthehey
(3,660 posts)I know renters like to pretend they aren't paying property taxes, but that would suggest landlords are too stupid to set rents that cover all expenses, including often higher non-homesteaded property taxes.
ieoeja
(9,748 posts)When the mortgage is paid off, I will finally make a profit. But for the past decade, I have been losing real money. And will continue losing real money for the next couple of decades. Which means I'm going to see my retirement net income jump about $15k in my mid-70s.
Although, if not for one big expense last year, I would have made my first profit by IRS rules. Mortgage payments are not a deductible expense. For every dollar I pay in mortgage I gain a dollar in equity. That equity does not, of course, put a penny in my pocket. So I am losing pocket money. But making theoretical money.
True Blue Door
(2,969 posts)Reter
(2,188 posts)OK, I'm sold.
laundry_queen
(8,646 posts)You'll see eventually you would be able to afford it because homes would go down in price (quite drastically), due to speculators and investors being unable to artificially inflate prices. Or you could buy your apartment for the same amount of money you rent it for (condo-style I guess).
Not sure I agree with the OP, but it's interesting to think about.
yeoman6987
(14,449 posts)laundry_queen
(8,646 posts)Why glory be? Please explain.
No wonder no one posts anything of substance here anymore. This whole thread is like an elementary school playground.
yeoman6987
(14,449 posts)I guess you don't like this one....read on maybe you might like some others.
Lee-Lee
(6,324 posts)You wouldn't see people who were just starting out or starting over in life have anything.
Think about it- a house has a minimum cost, period, of materials and labor to build it. This half-baked plan would indeed affect land values, making the value of the land the home is on drop, but the actual hard value of the home would be what it costs to build at any minimum.
Now, imagine you are a fresh out of school 19 year old who is setting out on life. You need to find a place to live. You don't have any money to buy a home outright. You don't have enough for a down payment and you don't have any credit so a mortgage, even a low one, is out of reach.
If you can't rent, where are you going to live?
Say your a newly separated single mom fleeing an abusive relationship and you made it out with little more than the clothes on your back. The family home will be in dispute with the divorce for months if not years, and you don't feel safe there. How do you buy a home while trying to feed and care for your kids and manage a newly single life?
None of those people can afford to buy a home.
Nobody is going to build multi family housing if they can't make money renting it, so more sprawl. And even if they did, someone just starting in life or starting over in life can't afford to buy an condoed out apartment no more than they can afford to buy a home- and any ownership of an apartment would require common management of the property as a whole with maintenance fees paid.
True Blue Door
(2,969 posts)It's a hugely profitable industry because it can demand more from the even huger profits of developers and speculators.
Trust me, the cost of building houses is hugely inflated, additionally because of the artificial restriction in supply created by allowing landlordism.
More people being able to afford houses means more houses being built, and being built more efficiently.
Also, requiring purchase doesn't mean you have to purchase an entire building. You could have transfers of ownership that are shares in the property, so if all you want is a room quick, you can buy the share of the property that room represents and have similar (but easier) arrangements that condo buyers make.
With a more commoditized price, selling it back when you don't want it anymore should be relatively quick and painless.
Lee-Lee
(6,324 posts)Or been a landlord.
Buy a share of a home quick? What a laugh- there is no such thing as a "quick" real estate transaction.
Furthermore, only a complete idiot would sell a room in their home- then if that person ends up being an untolerae nuisance or a problem you are stuck with them forever- the roommate from hell you can't evict and who drives the value of what you own down so far you can't sell a love.
And what if you can't sell that share of a house back when you have to move? Your idea that it should be "quick and painless" once again shows a naivety about how real estate works. What if you get a great job offer in another state and can't sell your share of the home- how do you move?
It's an utterly absurd idea all around.
lumberjack_jeff
(33,224 posts)Great idea! And who better to loan the buyer the funds needed to purchase this short-term ownership than the seller!
When the buyer no longer needs the property and wants to move, the seller can agree to retake control of the building, giving the buyer the security of knowing he's not going to be stuck with a property at a place in which he no longer wants to live. Of course, the seller is entitled to some interest on his loan.
This is actually what we do today, but we call this interest "rent".
Thinking outside the box? Sometimes the box is there for a reason.
tammywammy
(26,582 posts)
TexasMommaWithAHat
(3,212 posts)to buy property - at least the vast majority of people do.
Why should any lending institution grant a loan to someone who has no down payment? Who has bad credit?
This is one of the most ridiculous ideas I've read here. Unconstitutional. Unworkable.
Pie in the sky.
Lee-Lee
(6,324 posts)a more complicated rent-to-own scheme.
Person moves to town with no money and no credit.
Can't rent a room or apartment because now under this idiotic plan its illegal.
Owner of a big apartment building "sells" them the apartment with no money down, monthly payments, on a contract that says if they default ownership reverts instantly. And rules like until they pay off the property it must be maintained in good order, occupancy rules, etc. Of course the person isn't staying there for 30 years to pay off the "mortgage" so ownership reverts back to the previous owner when they leave...
And the cycle continues- of people renting while not calling it rent.
WillowTree
(5,325 posts).......wants to move, the owner of the rest of the house doesn't want to buy the room back? Or now can't afford to buy it back?
What if the person who "sold" the room (and, one would expect, kitchen and bathroom privileges) gets transferred to a different city? Now s/he can't sell the whole house and would have to find someone willing to buy part of a house that they are willing to share with someone they don't know, didn't choose or approve, and could be a nightmare to live with. I can't speak for anyone else, but I'm not going to commit to such a purchase and move in with my pets and Mother's silver and Grandma's jewelry, let alone get undressed or sleep with both eyes closed, with a total stranger living there with the run of the house whether I'm home or not.
Are you saying you'd really be willing to live and invest in such a living arrangement?
X_Digger
(18,585 posts)Margins on house building are thin at all but the high end housing. One screw-up by a careless sub-contractor can blow away all profit on a house. On a $120,000 house, my dad would be good if he could clear $8k in profit.
TreasonousBastard
(43,049 posts)although I doubt you meant it to.
Since land is a limited resource, I've always liked the idea of a commons where land is owned in common, but the buildings farms, etc., on it are private. Ain't gonna happen.
I like the idea of "council housing", of which the US had quite a bit of over the years. Public housing was a big deal in the early 20th century, thanks to Riis and others, but the idea ended up with a bad rap and most of it is sold off or neglected.
The Trumps and Lefraks of the day made fortunes off of cheap rental housing, leaving public housing in the dust. Large life insurance companies, with vast amounts of cash to invest, also built mass housing, and did a better job of it than those guys, but they are out of it now.
Right now, it would be incalculable how we could deal with the trillions in value trying to change from a rental system to anything else. Of course, like Lenin and Hitler, some badass could just order it and kill off anyone objecting.
True Blue Door
(2,969 posts)Not that I'm exactly a cheerleader of capitalism, but I do recognize the utility of markets. Unfortunately, renting, leasing, and other mechanisms that separate usage from profit undermine the value of markets and create a quasi-Manorial economy that makes most people increasingly poor.
I do like some ideas of common land ownership, managed democratically or with equal privately-held shares. This would actually make that sort of arrangement more plausible, since more people could afford to buy, they could afford to buy more of it, and the greater volume of demand and transactions would make the market easier for average people to deal with.
olddots
(10,237 posts)they die even when they become machine like .Fucked up !!!!! 
The main reason I have been at odds with money is because I see the faults in materialist capitalism while living in a world based on it .I choose to not make the best of a bad thing as republicans chose the oposite .The argument of the glass being half full or half empty is bullshit because humans are making sure there is no glass to begin with .
Learning that progress is not always progress is part of our needs that never seem to get met .
jonno99
(2,620 posts)how would folks exchange goods & services if not for some sort of monetary system?
Historic NY
(37,449 posts)True Blue Door
(2,969 posts)You're basically making the same argument Republicans make when they argue against tax increases on the rich, saying they would fail to invest because they'd rather lose all opportunity than pay higher taxes on a profit.
NCTraveler
(30,481 posts)True Blue Door
(2,969 posts)NCTraveler
(30,481 posts)Proceeds going to the one percent as middle class Americans get screwed.
jeff47
(26,549 posts)
JCMach1
(27,553 posts)True Blue Door
(2,969 posts)At least to some percentage. All such investments made before the legislation. As long as all subsequent transactions were done under the new system, it would be worth the up-front cost.
Snobblevitch
(1,958 posts)Response to Snobblevitch (Reply #39)
Post removed
ProfessorGAC
(64,827 posts)If you're not, why accuse someone else?
Starry Messenger
(32,342 posts)They sold off the stock to former tenants. It went poorly, as a program. I don't have time to search today, but it might be relevant to this discussion.
True Blue Door
(2,969 posts)
ileus
(15,396 posts)True Blue Door
(2,969 posts)
FSogol
(45,435 posts)After that, can we please get rid of leaf blowers?
True Blue Door
(2,969 posts)If you're against the government regulating business, I wish you well at the next Tea Party convention.
NCTraveler
(30,481 posts)I hope you take some time to go back and read how many people you have relegated as the right simply because your idea falls flat on face value, and beyond.
True Blue Door
(2,969 posts)A lot of folks are just giving knee-jerk reactions rather than rational thoughts. And the fact is a lot of the arguments being aired are quintessentially right-wing, plutocratic, conservative viewpoints. People are dismissing the idea, not thinking about it and finding problems with it.
This society really brainwashes the hell out of people to not only tolerate the intolerable, but actively react with contempt to even the idea of change.
Even here.
NCTraveler
(30,481 posts)You have also insinuated many are right wingers. Including liking someone who has never shown a conservative view on this board with a tea party member.
SheilaT
(23,156 posts)making buying and selling their residence impractical at best isn't an objection that withstands scrutiny? Explain just how you think your system of Everyone Owns Their Residence and No One is Allowed to be a Landlord would work in the real world?
What fantasy world do you live in where you can see someone buying a home to live in for a year, or six months a quick and easy transaction? Have you ever bought or sold a home? Sometimes it happens quickly, sometimes not so quickly. As others have pointed out over and over, not everyone wants the responsibilities and expenses that go with home ownership. Yes, it's true that property taxes and the cost of maintenance are folded into the rent, but it is not the tenant that needs to directly pay these things. Or figure out where to find a plumber on a weekend. Or any of the myriad details that go with actual home ownership.
guillaumeb
(42,641 posts)On Tue Aug 4, 2015, 07:39 PM an alert was sent on the following post:
CO2 is a molecule. Landlordism is a business arrangement.
http://www.democraticunderground.com/?com=view_post&forum=1002&pid=7042200
REASON FOR ALERT
This post is disruptive, hurtful, rude, insensitive, over-the-top, or otherwise inappropriate.
ALERTER'S COMMENTS
Insinuating a member is aligned with the tea party has never been allowed here. In this instance, it is being directed at a long time member in good standing with just about everyone.
You served on a randomly-selected Jury of DU members which reviewed this post. The review was completed at Tue Aug 4, 2015, 07:51 PM, and the Jury voted 2-5 to LEAVE IT.
Juror #1 voted to LEAVE IT ALONE
Explanation: Get a thicker skin, for god's sake.
Juror #2 voted to LEAVE IT ALONE
Explanation: Oh, leave it alone, please. It is just run-of-the-mill snark. Much worse is happening these days. We all need to tone it down. But I think this thread is, on the whole, a polite discussion.
Juror #3 voted to LEAVE IT ALONE
Explanation: No explanation given
Juror #4 voted to LEAVE IT ALONE
Explanation: Absolute ridiculous alert. With any luck, it's a 7-0 vote.
Good grief.
Juror #5 voted to LEAVE IT ALONE
Explanation: I wish you well at the next Tea Party Convention is a metaphoric expression, not an accusation of actual membership.
Juror #6 voted to HIDE IT
Explanation: No explanation given
Juror #7 voted to HIDE IT
Explanation: No explanation given
Thank you very much for participating in our Jury system, and we hope you will be able to participate again in the future.
In my view a very weak alert.
mythology
(9,527 posts)Crippling the tax base as well as the ability for businesses to rent space (thus adding a huge cost to starting a new business) as well as forcing people to take take on taken a long term mortgage when it might not meet their needs is just silly.
What do college students who don't want to live on campus do? What do people working a year long contract do? Your plan would make those people take a 30 year mortgage for a short term situation.
Driving down property values would result in a massive loss of tax revenue when we can't afford that. Also given the mortgage deduction, there's another major loss of tax revenue.
If I want to start a business with a store front I can't rent a space, instead I have to come up with a down payment.
Additionally in places like Boston pretty much every apartment is set up for two or three people. Suddenly you would need to create way more housing for people meaning more people living further away from work increasing commute time and corresponding pollution and loss of personal time.
True Blue Door
(2,969 posts)Not so. Someone making x dollars a year can afford y dollars worth of property, regardless of how many square feet y dollars is worth. The tax base is based on y, and y is unchanged or even increased by so many people not being milked of income by landlords.
as well as the ability for businesses to rent space
Which is irrelevant because the price of buying any given quantity of real estate is substantially lower, and more money is available because it's not being accumulated by speculators.
to take take on taken a long term mortgage
Who said anything about a mortgage?
What do college students who don't want to live on campus do?
Buy shares of a place.
Your plan would make those people take a 30 year mortgage for a short term situation.
Hardly. Not everything is a McMansion.
If I want to start a business with a store front I can't rent a space, instead I have to come up with a down payment.
Which you would have because you hadn't been robbed by landlords your entire life. And the complaint that starting a business requires planning is pretty laughable. If you're complaining that it would be less feasible to start a business based on a plan scribbled on a Hooters napkin after a night of binge-drinking, that's a fair criticism - you would be less able to do that if you had to make a purchase rather than sign a lease or rental agreement.
Suddenly you would need to create way more housing for people
In other words, the demand for construction - and the prosperity of people who work in related professions - would spike. You sure are putting in a lot of effort to characterize good things as bad things.
whatthehey
(3,660 posts)your concept is based on the (wildly hypothetical) idea that house prices will massively collapse when there is no option to get income from rent, and make them affordable to the poor, but yet you claim in this post that y, the property value, will not change.
Property taxes are not based on income, but on property value which you just collapsed. How can property taxes also not collapse?
True Blue Door
(2,969 posts)Which is the value of property that they tend to buy, meaning that total revenues would not decline. In fact, they would increase because more people could afford to buy. Value that normally just goes into a landlord's pocket would be more evenly distributed, and the public sector would share in the benefit.
TexasMommaWithAHat
(3,212 posts)sigh
snooper2
(30,151 posts)We shall see!
True Blue Door
(2,969 posts)jonno99
(2,620 posts)
Cleita
(75,480 posts)If you occupy a place only three months out of the year, you may want to rent instead. Many hotels do have weekly and monthly rates.
jonno99
(2,620 posts)Cleita
(75,480 posts)using that money as an investment in property? I'm sure there could be exception where if you need a house for three months and a house owner was going to be gone for three months you could make some kind of deal.
However, home owners look after property better than landlords or tenants so the neighborhood doesn't sink into decrepitude.
jonno99
(2,620 posts)are not interested being responsible for fixing the pipes, painting, caulking or 100 other tasks.
Otherwise, I am a big proponent of ownership - for the very reasons you cite.
We just need to be careful of one-size-fits-all policies...
Cleita
(75,480 posts)to let the camels nose under the tent so to speak, but a few that can be accommodated.
1939
(1,683 posts)Cleita
(75,480 posts)Used to be the Inns in a village served a purpose, putting up travelers and their horses up for the night, offering them a meal and some ale as well. Otherwise travelers had to camp in the woods or impose on private cottage owners for a place on their floor before the hearth or even their barn. It made sense. It still does. Travelers need a wayfarer station. Permanent residents need a permanent residence. Make sense?
1939
(1,683 posts)Making a profit by renting out space you own should be illegal according to his logic. If it should be illegal to rent it by the year, why should it be legal to rent it by the day, week, or month?
Cleita
(75,480 posts)jeff47
(26,549 posts)True Blue Door
(2,969 posts)Well gee, I guess in that case - similar to that other conservative trope, the employee who WANTS to be non-union, make less money, and have fewer benefits - you would have to do the next best thing and just throw some of your newfound disposable income into a fireplace.
jonno99
(2,620 posts)I want to sell my house, I am also "free" to do so - unless the market value has fallen - then I'm screwed.
This argument fails too in terms of simple normal human behavior. Using your logic, no one ever would - or should - eat at a restaurant. Why? because it is always cheaper to buy the food and cook it yourself. So why do so many people act against their financial self-interest and eat at restaurants?
I mean aren't restaurants also exploiting us by marking up the cost of food by 100, 200, 500%??
"Fast food" especially exploits it's patrons by selling "fat food" at inflated prices disproportionately impacting the poor.
Should we make restaurants illegal too? If your answer is "no", then take all those "no" arguments and apply them to the question posited by your OP.
Cleita
(75,480 posts)Last edited Tue Aug 4, 2015, 03:24 PM - Edit history (1)
better than renting if there are laws in place to protect the buyer and then owner/tenant. I think it would be great though for commercial property. It would keep giant corporations from renting out extra space in their skyscrapers on ridiculously one sided leases. It would also force them to occupy whatever spaces they do own.
True Blue Door
(2,969 posts)Real estate speculation and absentee landlords are a huge drain on the economy, driving prices far higher than they need to be.
It's telling that we still use the word "lord" to describe someone who rents out property - pretty much the only case in American English that isn't a religious expression.
Auggie
(31,130 posts)has me wondering when and how it began.
jonno99
(2,620 posts)else relating to humans, there are bad and good landlords, as well as good & bad tenants.
It seems to me that the OP is declaring a solution - when there isn't a problem ("landlordism"
.
If the OP wants to argue for affordable housing initiatives, I think he'll get a more positive interaction here...
Auggie
(31,130 posts)don't take it seriously.
I think it's an interesting subject to consider how, socially and commerically, we evolved to this one particular arrangement we know of as landlord/tenant.
jonno99
(2,620 posts)necessarily set in stone. Some folks will always remain a tenant, while others start out as a tenant, then move on to purchase there own home or property. Then in their senior years, most folks revert to again being a tenant (if they weren't already).
For me the most troubling social aspect - especially in the US - is advent of the "fractured family"; where the kids move away and basically never return - leaving the old folks to fend for themselves, warehoused in high-rises or relegated to an "old folks home"...
Cleita
(75,480 posts)I have such an arrangement myself. I occupy a small trailer on a relative's property. I'm autonomous but know that they are there for me if I need help. However, I'm certain I will end up in a nursing home eventually, when my needs become overwhelming for them as I have no children of my own.
However, I am aware that modern life makes taking care of grandma not a practical situation all the time. Young families, with children and both parents working don't have the time, money or strength to look after an aged parent or grandparent. When I was growing up, women stayed at home and often there was a unmarried sister, or widowed aunt around to help out. It's not that easy anymore.
jonno99
(2,620 posts)became less that revered? I look with respect (and some yearning) to the cultures - Japan come to mind - where the elderly are considered treasures.
Sadly too, it seems that even Japan is becoming more "westernized"; which means I suppose that they will share our "fractured family" fate as well.
sigh...peace to you.
Cleita
(75,480 posts)Pharoahs.
whatthehey
(3,660 posts)Early settlers simply built shelters from local materials wherever they could grow food and defend their settlements. But after widespread "civilization" you're surely right. Even when no rent was normally paid (the earlier Pharaohs commanded labor and food tribute, but you could build your house wherever there was space) the ruler could take what he wanted
Cleita
(75,480 posts)to the King. I think we fought a revolution over that.
Auggie
(31,130 posts)it started somewhere
Cleita
(75,480 posts)cows. But they do have a belief that their home territory belongs to everyone who inhabits that territory. Then there are primitive tribes with a village and a chief like maybe in the Amazon. They are more communistic in their approach.
But other than that, once we settled down to agriculture, the chief, warlord or king owned everything in the territory they claimed. They allowed everyone else to live there, but they had to pay rents, not necessarily in money but in a crude taxation system of goods and services.
Auggie
(31,130 posts)property started to have real value.
jeff47
(26,549 posts)Auggie
(31,130 posts)jeff47
(26,549 posts)and would "forcefully evict" another tribe that tried to move in.
Auggie
(31,130 posts)jeff47
(26,549 posts)The tribal leaders controlled the land, and allowed some "renters" to use it while keeping others out. The tribal leaders would be paid in the form of food shared by the hunters.
A checkbook does not have to be involved for it to be a landlord situation.
whatthehey
(3,660 posts)Almost all the population there lived in tiny cramped fire-prone tenements. Rural dwellers also paid rents. In fact the Senate class had a wealth requirement of roughly $25M in today's money in the late Republic, and most of them got that from rent.
True Blue Door
(2,969 posts)Let's stop doing anything, since it's all so futile and problems are totally insurmountable.
daredtowork
(3,732 posts)The stock market has an SEC that regulates, steps in over major rises and falls, and punishes activities like rumor-mongering to create false markets. Why don't we have that to protect the rental market where people's shelter is literally dependent on the rents remaining stable rather than being blown up into speculation bubbles?
Also rents right now are being notoriously manipulated by factors outside the local community or even outside the country in "desirable" (for the purposes of investment funds) urban areas. Countries around the world with devalued currencies, crime rings, and corrupt government officials are investing in US real estate - and Janet Yellen is keeping interest rates low to encourage them to do so in hopes that it "drives" the economy (even if construction jobs are temporary, they look like "job growth" so we can fake some sort of economic recovery). California in particular dropped almost all support for developing low-income housing and decided to court these outside investors instead: local communities were undermined by absentee landlords speculating on the properties beneath them. Rents soared. Property owners had put laws in place long ago to "phase out" rent control, and now these laws worked in favor of real estate commodity brokers. Since these schmucks have all the money, they stuff political coffers, form local shadow governments, and ram lobbyists in the way of any attempt to stop their windfall-grab.
Landlordism isn't what needs to change: this country's workforce is mobile - people still need to be able to rent a place to stay.
What needs to change is the underlying concept that Real Estate that is being used for rental housing is a "hot commodity" for speculators.
Rental housing should be treated as a vended service. It should be highly regulated with a minimal profit structure. Landlords may "revolt" at first and claim no will rent, and perhaps that means there should be a competing public option for rental housing. But eventually the psychology will change, and some landlords who want to make stable, rather than windfall, money in that particular business will choose to provide that service. That will simply become the way rental housing is provided, take it or leave it. This will be like employers having to follow OSHA safety rules or having to pay minimum wage or like public utilities not being allowed to charge infinite prices just because everyone needs heat and electricity. Sure everyone WANTS to make windfall profits if they can, but they shouldn't be doing it at the expense of human shelter.
And if private landlords can't or won't do it that way, then we do need to develop enough building unit housing for those who need to rent. At that point people in nice houses have no right to complain about the tall buildings that have to be built right next to them. Younger, mobile workers need a place to stay. Elderly folk who wish to remain independent but who could never afford to own a home need a place to stay. Disabled people who have always been on a fixed income and who could never afford to buy a house, need a place to stay. Tough cookies: if this can't be vended through private sector houses, it will have to be via units in buildings developed expressly for the purpose. I'm not a fan of that outcome, but that's the obvious outcome.
Most of all these changes to the Real Estate market need to be ON DECK NOW. Congress brought the Planned Parenthood issue to a vote within a month. The housing crisis has been going on for a couple of years. Why does taking action on that need so much "process"? Having now seen how fast our government can act when it wants to, I would like to see the Federal government enact some commodities rules for housing used as rentals and put in place an SEC-like body to address those issues NOW. I'd like to see the State of California act just as quickly to overturn Costa-Hawkins and Ellis Act evictions so cities with rent control will have the tools they need to protect the rent controlled housing they have left from speculators while they wait for better regulatory tools to come down the pipe.
And I would like Janet Yellen to come out and admit that though her policies may enrich Wall Street and somehow "create jobs", the resulting housing bubble also does a lot of harm, and she has had no suggestions as what to do about that.
Cleita
(75,480 posts) 
hughee99
(16,113 posts)with poor or no credit and not nearly enough money to put down on the house.
My guess is you would just find a lot of landlords turning their rental properties into "hotels" and continuing with business as usual.
muriel_volestrangler
(101,262 posts)No loans allowed.
yeoman6987
(14,449 posts)It would be a complete disaster that nobody would want. Heck even if homes dropped from 200K to 20K......most don't have that kind of money to buy a house outright. If that were the case, we wouldn't have auto loans.
hughee99
(16,113 posts)and since those that didn't couldn't rent, most would be homeless.
I was assuming the OP was talking about taking equity out of a home you already owned, though.
jeff47
(26,549 posts)Which the OP apparently believes everyone has sitting in their bank account.
hughee99
(16,113 posts)or anywhere near the value of the land it sits on.
jeff47
(26,549 posts)The OP does not appear to have considered the costs of building a house.
hughee99
(16,113 posts)If a person can't own land they don't live on (one with NO structures, for example), that's a whole other can of worms.
Throd
(7,208 posts)This might not be the dumbest thing I have seen posted on DU, but it has to be in the top ten.
NCTraveler
(30,481 posts)You say they will just by apartments. They already can in concept. They just call them condos. Also, many tenants are tenants for a reason. They aren't in a place to build equity off the place they live. They buy an apartment(under your thoughts they would simply be reclassified as condos), the ac breaks down and is a $2300 repair. Do you think all of the renters have that laying around. Current apartments allow them to pool the costs to fix those things. Pooling in this aspect is not a bad thing. In your scenario, they would be responsible for ac, property taxes, plumbing, etc.. Pooling recourses is a good thing. Not a bad thing. It helps to make apartments more affordable. Your approach leaves out almost all thought of costs associated with property ownership.
Tenant landlord relationship is not a bad thing overall.
elleng
(130,714 posts)kind of like soviet 'communism' planning.
ONE example: I rent a lovely small house adjacent to larger house of my landlord, on a 60 acre piece of land bordered by a river and creek 60 miles south of DC. The 60 acres contains kitchen gardens (whose abundance he shares with me) and plots that are farmed.
There is no way practically to separate my home from my landlord's land, I don't want the burdens of ownership, insurance and maintenance etc., too much for me; I owned another house in the past. NO THANKS.
FreeJoe
(1,039 posts)At first, your plan might work. The problem would be that people would be much less willing to build homes. Today, if I build a house, I can live in it, sell it, or rent it. Under your plan, that last option is off the table and, as you suggest, the sale price might be much lower as well. That significantly reduces my incentive to invest in a house. Even more importantly, it destroys my willingness to build an apartment complex. The result would be fewer and fewer houses being built. Just like cities that have rent control, shortages would appear and the home prices would stabilize at a level many would find unaffordable.
Another possibility is that an entirely new sales model would appear similar to auto-leasing. Instead of renting you an apartment, I'll sell it to you with financing designed in such a way that you are effectively renting it even though you legally own it. It would be something similar to leasing a car. I'm going to sell you the house but the conditions on the loan I give you are going to make you treat it like a renter.
Another problem with your idea is mobility. There was a period in my life when I moved a couple of times a year. Renting was great because the transaction costs for the moves were low. If I had to go through the expense of a property sale (typically 3-8% of the cost of the property), moving would have been cost prohibitive. That would have significantly stunted my career.
Honestly, I rarely ever had problems with landlords. When I did, I moved.
Positrons
(53 posts)No desire to buy a house every time...
I swear...
hill2016
(1,772 posts)let's assume somebody wants to sell his house.
Now there are two potential buyers
(1) A recent graduate fresh to the city with a new job. Has a brand-new degree but no assets. Lots of student loans. Looking for a place to stay.
(2) The rich neighbor who wants tear down the house for a bigger garden. Has more money than he knows what to do with.
Now who do you think will end up buying the house?
Adrahil
(13,340 posts)My wife (before we married) got a visiting professorship for 6 months. It would make literally NO sense to buy a house for 6 months. She rented an apartment. That made sense.
PasadenaTrudy
(3,998 posts)This is also my only way to stay afloat. Don't take that away from me.
Xithras
(16,191 posts)The problem with the concept is that it presumes home ownership to be an ideal that everyone should pursue. Many of our societies young and poor require mobility to pursue jobs and opportunities as they arise. By eliminating rentals, you are forcing them to purchase land that ties them to one spot. If a move is then required for a job (or anything else), the person now has to figure out how to buy a NEW piece of land at their destination. If they are in a downmarket or blighted area where the sales market is poor, that means you're going to require them to either take a huge financial loss, or sit on it for months or years until it eventually sells.
The net effect is that moving becomes an even larger financial burden than it already is, and would likely become a source of constant financial loss for those at the lower end of the economic scale (who tend to move far more than the wealthy).
On top of that, many people choose not to own because of the increased costs. I just put a new air conditioning unit on my house. Cost? $11,500. It was a hit, but I can afford that. Many people can't, which is why they rent (a landlord can amortize a large repair bill like that over many years). By requiring people to own their properties, you are limiting the quality of their residence to what they can afford to pay for out of pocket. Within a generation, most people will be living in hovels. Renting allows poorer people to attain a higher standard of living than they could afford out of pocket, because part of the cost of a homes quality and repairs is covered by the landlord as an investment (that obviously doesn't apply to slumlords).
Ace Rothstein
(3,140 posts)Where do people come up with these ideas?
alphafemale
(18,497 posts)Just a guess.
Likewise I think people in Wisconsin should go without central heat since I rarely have to turn on mine.
Those rare nights I have to turn on the heat I could cope if I want to.
Why can't they?
///sarcasm///
I have a target on my back. As far as the hide brigade goes.
I have to make it obvious I am kidding.
steve2470
(37,457 posts)
DrDan
(20,411 posts)and what about those who like to rent for less-than-full time - like retirees who rent (like in a beach location) for months at a time rather than buy.
This idea works for you as you apparently see owning as preferable to your situation. Everyone is not the same.
onenote
(42,531 posts)Or would there be limits on how long one could "rent" a hotel room.
And what about vacation properties - if I want to stay in a beach house with two other families, do we have to buy the house?
If I'm transferred for my job for a one or two year stint, do I have to sell my current house, even though I'm plannning on returning, and buy a house that I have to get rid of in the next year or two?
alphafemale
(18,497 posts)I have what is essentially a nice sized studio apartment in the upstairs of such a place.
I have my own bathroom and a mini-fridge, micro and toaster oven.
Also included is full kitchen and laundry room privileges.
Cable/Internet and all other utilities are included and I am not going to get rocked by a surprise bill.
This is what I want.
I want no part of the hassles of property maintenance or any other part of property ownership.
lumberjack_jeff
(33,224 posts)I own a home on nine city lots in which to live. You don't have a home.
I accept that this is a problem statement.
Explain to me the mechanism by which someone is going to build you a place to live, or by which I'm interested in selling you any of my vast and uncrowded lawn.
Reasonable people would instead invest in tent factories.
MADem
(135,425 posts)all it would do is create a vibrant black market, where people "gave" (cough) the use of their property for "free" (cough) but the occupants managed to give the Landlord-Not (cough) a present for every conceivable holiday.
I've had great landlords, who cut the grass, fixed the boiler, solved my problems in foreign lands, took away the garbage, and did all sorts of good things. Payment made, value received. Not all landlords are assholes....and no, I am NOT a landlord and I do not presently live in a rented accommodation. I've just had good experiences with them.
GitRDun
(1,846 posts)Speculating on homes ends, but so does recycling old homes.There are thousands of people who make a living buying somewhat beat up homes, fixing them up and selling them. Without the backstop of being able to rent if something happens and the house doesn't sell, this business disappears. Most individuals don't have that kind of capital to risk.
The cost of owning a home is more than just selling price. What you save a homeowner in capital will be made up for in property taxes, insurance, repairs, maintenance. Just because property values are down, does not mean your property tax bill goes down. Cities, counties have a nut to cover. They'll just raise tax rates to cover their costs if values go down.
Zoning laws prevent owners from operating a business that employs people in most cases so that use does not work.
Lots of people like to rent. Your laws will just drive the rental market underground. Drinking age is 21. Kids drink anyway. Then tenants will be in a worse situation because in order to stick up for themselves, they would be admitting criminal wrongdoing. Worse, they may just move on to the next dark lord.
My conclusion? We're far better off with mandatory city inspections than no renting at all.
Hekate
(90,538 posts)....from the university, community college, and private colleges are in need of rooms. You think they are going to BUY something? With what money, exactly? Many retirees, widows, and single women own their homes of many years but are barely making ends meet. With the kids gone, they can RENT out a spare room to someone who needs one. Or, they can rent out that spare room to a working adult on a long term basis.
This is not a new model by any means. It's not only my own Plan B in case of need, but on reflection something I recognize from my own parents' childhood during the Great Depression, as both sets of their parents rented out rooms in their homes in order to make ends meet until times got better. My own adult kids always seem to have a roomer on the premises.
I don't know where you are on the owner/renter experience, but you seem to need to think this through more carefully in the reality based world.
Otherwise, I'll have some of what you're smoking.
Lil Missy
(17,865 posts)Taitertots
(7,745 posts)Banning renting is throwing out the baby with the bath water.
Thinkingabout
(30,058 posts)I would like for those who thinks it is fair to halt landlords, how are you going to feel about picking up the shortfall of taxes?
steve2470
(37,457 posts)1- Are there bad landlords ? Of course. Laws can be written and tweaked to deal with them. Are there good landlords ? Yes, I've had several.
2- Are rents too high in some areas, like San Francisco ? Yes and that's why there's been rent control laws. Of course, "too high" depends on your income, wealth, and whether you're the landlord or the tenant.
I was a tenant for many years, partially because I moved many times. I'm GLAD I was a tenant. Anyone who has ever bought a home knows, despite the eventual pleasures, what a PITA it is. As someone said, there's no such thing as a fast real estate transaction. Renting is different. If you have the money, a good credit record and there's space available, in some cases you can move in TODAY. Try buying a home in one day. Not gonna happen.
I think tweaking the laws and writing decent new ones is a much better idea. Don't throw the baby out with the bath water.
alphafemale
(18,497 posts)I love renting.
Especially in my case where utilities are covered.
I get along great with the other housemate who is downstairs.
People are finding alternate ways of living like they want to.
Yeah renting is part of this.
I want to own nothing more than a tent.
steve2470
(37,457 posts)It worked for me for many many years.
alphafemale
(18,497 posts)Not my circus. Not my monkeys.
steve2470
(37,457 posts)alphafemale
(18,497 posts)And still owe more than the property is worth.
They are basically slaves to the banks.
So much for property ownership being an automatic wealth ticket.
steve2470
(37,457 posts)
MFrohike
(1,980 posts)I see a lot of hand-wringing about tax bases and property values but absolutely no questioning of the assumptions that underlie those things. Ideas like this are tailor made to question assumptions, but I guess the horse just won't drink.
Just for my own curiosity, is this derived from or inspired by Ricardo or George?
hill2016
(1,772 posts)you need to address.
(1) There are lots of rich people who are perfectly willing to buy up land without renting it out.
(2) A home is a capital good/fixed asset. Even excluding the value of the land, there are actual costs in manufacturing the house including the building materials, labor, appliances, furnishings, etc.
Hence there's a floor on how much property prices will fall even if people are not able to rent it out. And this floor will be greater than what someone who might be able to come up with the cash for a rental (deposit + first + last) can cough up in one go.
Travis_0004
(5,417 posts)I own a house, but I took on a temp assignemnt with my company 4 hours away. I will be away for about 9 months. I rented a furnished house. What is your solution, stay in a hotel for 9 months? In this case I wanted to rent. To buy a house short term makes no sense.
Also, right now I can buy a nice house for 150k. That house can not be build for 150k. Probably 200k or more. Therefore new construction is down until housing price rise a bit more. There will always be people who will pay a premium for a new house, but for the most part when housing is cheap, construction is down.
Under your solution, prices will plumit (and I'll just walk away from my mortgage, buy a similar house and save 100k, but lets ignore that). With prices down, new construction grinds to a halt, which isn't good for the economy. Eventually prices will climb back up because of increased demand and almost no new construction. Eventually the cost of a house will equal somewahat close to the construction cost of a hosue, and we will be right back where we started.
SoLeftIAmRight
(4,883 posts)very much
many thanks
X_Digger
(18,585 posts)How about small businesses that can't afford to build their own retail space? And what do you do with the existing leased space? No commercial real estate in one place would exist-- ever. No malls, no shopping centers.
Or how about a homeowner who can't afford to get their kitchen re-done within the next 10 years by meager savings, but can afford a low-interest home improvement loan?
Or students in college?
How about those with shitty credit that the bank would never loan to? Sucka, you on the street!
Fuck that noise.
independentpiney
(1,510 posts)After becoming disabled I could neither do the maintenance and upkeep myself, or afford to pay others to do it for me.
jeff47
(26,549 posts)A very large part of the cost of a house is the cost of constructing the house. You've just made it illegal to finance that.
Unless you also want to ban people from being paid to be plumbers, carpenters, painters, and so on. And make people hand out construction materials for free.
Cheese Sandwich
(9,086 posts)You are describing a revolutionary change to remake the entire society. So think about it that isn't going to pass a legislature without mass disruptions by millions of people acting in a very organized way. This is like a dream for someday in the future like something out of a John Lennon song. Imagine there's no landlords. If you like this idea then we can only start by organizing in much smaller ways for now, by meeting up with like-minded people in our own areas, if there are any.
lancer78
(1,495 posts)Would still make housing unaffordable for many. People would then have to earn enough so they can buy their house outright.
Blue_In_AK
(46,436 posts)I own a duplex and rent out the other side. I've been living here since 1990, and have always rented to family or friends well below market. Most years I take a loss on my tax form, but I don't care. Buying a duplex was the way I could qualify for a home loan, and it has been great for me and for my tenants. The assumption that all landlords are "bad" is a wrong one.
hunter
(38,301 posts)Many duplexes were built explicitly for that purpose.
Hmmm... Maybe instead of "outlawing landlords" we ought to say owners have to live in the buildings they rent for some period of time.
My parents have rented out houses they've owned for various reasons, but never as an "investment." Mostly they break even or lose money. They are retired now, in the sense that they are full time artists. They live in a rain forest, drinking and bathing in water that falls on the roof of their rain forest home, but they rent out their California house. I've never visited their rain forest house. The air fare is beyond my current budget and I've got no sailboat.
As me and my siblings were growing up my parents were artists with day jobs. They've owned houses they've rented out for most of the time I've known them (Heh, more than half a century now!). I'm guessing it's a kind of security for them. Whenever their latest artistic/housing adventure doesn't quite work out they can retreat to where they came from. My parent's homes are always an intrinsic part of their artistic adventure. I don't think my parents could be happy in a place where they're not free to paint the walls whatever color they like, rip out the carpets, adopt difficult animals, or garden as they please. They always extend these same freedoms to tenants. Pay the rent, more or less on time, and don't burn the place down. Nobody sweats the small stuff. I have some funny stories about "small stuff" that many people posting in this thread would consider "BIG STUFF."
When I was a teen we moved to Europe. My parents rented out our home in the U.S.A.. Therefore we had a place to come back to after many adventures and misadventures. At our lowest point we were living as indigent U.S. Americans in a French public park, and the site of one of the worst public toilets in the entire universe. The people in town didn't know what to do with us and it was especially uncomfortable because none of us spoke French, so they eventually bought us ferry tickets to England.
Bon Voyage, weird American family!
My dad repaid the debt and more when we returned to the U.S.A. and him to good union employment. I'm quite sure that wasn't any worry about repayment in France. They'd ponied up to to get rid of us, forgotten it, and then, surprise, random dollars from America!
But in regards to the original post, I don't think landlords are the core issue with housing.
I do think everyone needs a place they can feel safe and secure, where they are free to paint the walls whatever color they like, even murals, grow whatever they like on the balcony or in the yard, and never ever have to worry about the carpet.
.
jonno99
(2,620 posts)1939
(1,683 posts)To cover mortgage, taxes, insurance, provide repairs, cover lost rents when there is a gap between renters, and legal costs for necessary evictions the rule of thumb is that the rental property has to rent for 1% of the total price each month. In other words, if you pay $100,000 for a property, you need to get $1,000 in monthly rent.
cheapdate
(3,811 posts)SheilaT
(23,156 posts)who only need to live somewhere for a short time, a few months, maybe even a few years. How would it make sense for them to buy for such a short time?
There are many situations in which buying a home makes no sense whatsoever, and your proposal would make it impossible for anyone to rent for a short term. Trust me, buying is not always the best possible solution.
freshwest
(53,661 posts)I live cramped in a studio, but do have maintenance. If they'd sold me this studio, it'd've have been paid for by now or I'd have a place to live with a yard.
You have come up with a great idea, but this is the investment scheme that you mentioned in the other OP.
The only way I know to get this done is BIG GUMMIT to build and let us pay it off. It's demoralizing to be driven out by increaing rents.
But there is a desire or need to keep us moving around, as the population grows and they want to get more money for the land. And there are people who can pay more without their blinking an eye, so they want to keep their money and not pay taxes.
So how does that happen, without the power of the government? Everywhere it is being starved of funding, and the public is convinced it's a good idea. So IKD how to make it happen if people don't change their minds on this.
eridani
(51,907 posts)jonno99
(2,620 posts)Sometimes a word - is just a word.
Take the word "boss"; are ALL bosses "bossy"?
Hmmm...well, now we have to define "bossy" don't we?
And on it goes...
DrDan
(20,411 posts)ban rentals and force long-term visitors, workers on lengthy temp assignments, etc into hotels. I live in an area where thousands of Canadians visit annually - force them into hotels.
What happens to hotel prices with all this demand . . . through the roof.
Also - no cooking facilities means more restaurant visits.
Yep - a wonderful solution for the hotel/restaurant businesses.
Have you posted this thought on that other site? They would be thrilled with the boost to business interests.
Why share all that rental money with the little-folk.
SheilaT
(23,156 posts)everyone would not only need to buy their home or apartment, not matter how short a time they plan to live there, but everyone would need to pay cash for their living quarters. How realistic is that?
I'm certainly capable of railing against those who can't seem to save any money, but to pay cash for a home? Are you serious?
Orrex
(63,169 posts)Dorms and off-campus apartments would disappear, leading either to a huge drop in enrollment or a huge uptick in student commuters.
JustAnotherGen
(31,780 posts)Travelman
(708 posts)I've been a homeowner. It frequently is a colossal, throbbing pain in the ass. As a renter, if my air conditioner goes tits-up (as it did a few weeks back), then fixing it is someone else's problem (that would be the eeeevvviiiillll landlord) and they get it fixed. As a homeowner, when my air conditioner went tits-up, I had to spend days shopping around with different contractors before I eventually wrote a $5500 check to someone to replace the damn thing.
I'm not an HVAC expert. I'm not a plumbing expert. I'm not an electrical expert. I'm not a structural expert. I don't know shit about most of that stuff, but I had to learn a bunch of that stuff and I had to break my balls to do things like seal an eighth of an acre of asphalt driveway in the blazing July heat because I was a homeowner and that sort of shit has to be done. I had to sit in my crawlspace, folded in a most unnatural fashion, with a blowtorch replacing a pipe when it was eighteen degrees below zero Fahrenheit at 2:00 in the morning because I was a homeowner. I had to go out and take a chainsaw to a tree that fell onto a neighbor's property in a blinding rainstorm because I was a homeowner.
No thanks. I'll stick with renting. Much less trouble to let the experts deal with the problems.
