- cross-posted to:
- finance@beehaw.org
- cross-posted to:
- finance@beehaw.org
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Put a hard stop to the purchasing of homes by corporations/businesses and people with no intention of living in them.
You should need proof of intention to live in the home within a reasonable amount of time after the purchase in order to make the sale. The flipping of homes for profit by those with cash and more money is a detriment to the market and the american dream for the rest of the population trying to get a foothold.
Rather than a hard stop, I think it would be a good idea to significantly increase taxes on real estate no one is actively living in, and use the proceeds to subsidize construction of new housing.
Rather than a hard stop, I think it would be a good idea to significantly increase taxes on real estate no one is actively living in, and use the proceeds to subsidize construction of new housing.
An alternative is to replace property tax with a land tax. That way instead of penalizing people for building more housing, they are penalized for holding onto land that could be used to house more people (or whatever other use is in mind).
Nah tax the fuck outta landlords
This seems to be the most reasonable. Disincentiivize multiple property ownership rather than outright ban it. The ones who can eat the cost will pay taxes and the rest will just bow out of the market.
But housing is a need and people will keep paying any price to not be homeless, this feels like it leads to massive corporations still owning all of them and paying large taxes they can eat short term and raise to massive prices of rent. Maybe they dump some stock but I’m just not sure it does much other than diversify smaller investors that used property for assets
this feels like it leads to massive corporations still owning all of them and paying large taxes
Then the taxes aren’t high enough. That’s an easy fix. It’s one of those times the state doesn’t want to optimise the rate for total tax earned but to make paying it for any length of time actually prohibitive. Make it so that they can’t possibly raise rents high enough to cover those taxes and they’ll understand quickly.
The other side of the equation is a bit harder, and that’s housing overstock: Companies will be sitting on housing they can’t rent out due to lack of demand for housing. One idea would be to allow them to lease homes out to municipalities for literally nothing but tax forgiveness and the municipalities can use that to house the left-over homeless, unemployed, etc. Call it a half write off. Oh those leases need sensible minimum durations, I’d say five years is a good start.
smaller investors that used property for assets
You can easily make smaller investors be hit significant less by it by scaling the tax to the number of vacant housing units. Own a second home you rent out and spend four months finding a renter you like? Fine, pay ten bucks. Do that to 1000 housing units? Pay 10000 bucks for each.
Yes, those kinds of rates are right-out financial violence. That’s the point: The state has to step in as the larger bully to keep the small ones in check to avert market failure.
Your argument falls flat once you remember that there is in fact plenty of homeless people and there will always be those who will choose not to pay irregardless of logic or desire of self preservation. And while yes, any privatization of housing isn’t really any good, but you don’t have to make it impossible for them to make money off of it. You just play their own logic against them and keep it just on the line where they will ultimately go for something else to profit off of other than housing as their returns and infinite growth will eventually lead them into microscopic margins so any variability becomes a threat to the bottom line.
take the houses, take the landlord’s wealth they scalped, then fix it.
Landlords don’t “scalp wealth”. The income they earn is from working their job. Just like anyone else who is self employed.
removed working how? sitting there and collecting passive income? Are you fucking stupid?
How about being civil instead of name calling?
No
You’re essentially talking about decommodification of housing, which is the only correct answer. It is necessarily impossible for a house to be both affordable and a good investment, and the current status quo means that housing will be used as an investment. Whatever mechanism used to fix the housing affordability problem will require that housing no longer be subject to commodity market forces.
The value of a house should be in reduction of costs, not increase in real value.
When you rent, you pay for maintenance of your residence, some amount of furnishings, and the risk tht property owner takes in renting to you (i.e. the likelihood that you’ll destroy the property, fail to pay, etc).
When you own, you take that risk on yourself. You can choose to delay, DIY, or preempt repairs. You can choose what level of furnishings you have, and you are responsible for any loans or taxes due on the property. You don’t need to worry about unplanned vacancies.
Housing should keep pace with demand so property values stay roughly consistent with normal inflation. Unfortunately, cities tend to grow, making existing property more valuable.
When you rent, you also pay for the flexibility of being able to pick up and move in a short while if you get a new opportunity somewhere else, or just want to move for whatever reason.
Some people rent because they don’t want to worry about repairs, or mowing lawns, or any of that stuff.
They’d rather spend $3,500 taking a nice vacation than on a new furnace.
When you rent, you still pay for that $3500 furnace, you just pay for it in monthly installments through your rent instead of all at once.
You can accomplish the same thing with home ownership by using sinking funds. Basically, if you expect that furnace to last 20 years and cost $3500, you’d set aside ~$15/month, assuming your furnace is new. If you expect repairs in that time, set aside enough to cover that cost as well. If you do that for enough of your major repairs (roof, major appliances, driveway, etc), you should always have enough in the fund to meet any house related emergency, assuming your estimates are accurate enough on average. I do this in my budget by using online estimates for expected lifetime and cost to replace, and I do my best to make things last longer than that estimate. I do the same for cars and other large expenses so I’m always prepared.
That’s what landlords do, and homeowners can do it too. Budget for repairs just like you’d budget for a vacation.
Your first point is more important though. Selling a house is expensive and time consuming, so it absolutely makes more sense to rent if you expect to need to move with short notice. You’ll pay a premium for that convenience, and you’ll also not have to worry about repairs. For some people, renting is less expensive on net vs owning even if they don’t need to move quickly, e.g. if they know they’ll overspend on renovations and repairs. There’s absolutely an argument to both, I’m just pointing out that the value in a house isn’t in the appreciation imo, it’s in potential cost savings by taking ownership of repairs, vacancy, etc.
The problem is not that the furnace is $15/mo, it’s that it requires having $3500 all at one time. Newer furnaces have circuit boards on them and seem to require more repairs and maintenance. Everything does really. Appliances, water heaters, etc. There’s lots of expenses to home ownership and expenses that happen suddenly instead of being able to plan neatly for them.
Right, and those can be anticipated and mitigated. Options:
- home warranty - essentially forces you to save for larger expenses
- be pessimistic about expected lifetimes - i.e. only assume your appliances will live while they’re under warranty (most can last more than double that with proper maintenance)
- forego most or all other savings until you can pay for the highest ticket item in cash - it’s extremely unlikely that everything will fail at once
If something truly out of the blue comes up, you’re usually in appliance warranty or home owners insurance claim territory. The vast majority of the time, “unexpected” expenses could’ve been planned for, but the individual didn’t do their due diligence. A 20 year old furnace going out isn’t an emergency, that’s its expected lifetime (and with maintenance, a high quality furnace can last double that).
Owning a home is expensive, and so is renting. If you’re paying more owning a home on average vs renting for the same size of place (after, say, 6 years or so), you’re doing something seriously wrong.
Again, not everyone who owns a home saves up for those things. Case in point, one of my friends budgets for an annual furnace tuneup at the end of summer. Well, they discovered that the furnace is dead and won’t start up once it gets cold. So her plan is to work a second job for a month to be able to afford getting a new furnace since it’s close to winter.
If she was renting, the owner would simply replace the furnace and she wouldn’t have to worry about it.
How about expropriation of these homes instead of just a half assed “can we put a pause on capitalism guys?” You realize what the problem is. No more half measures, Walter
First step is seizing the ones they already bought, at gunpoint if they resist
As for “the market and the american dream”, lol. lmao, even
Death to America
well that doesn’t sound like free market capitalism!
its maddening there are plenty of homes out there completely empty
It’s worse than the headline says. The study set 71k as the average US income for a single person…
Which is the official household number. The actual single income average is 50-60k.
This still seems high to me, damn. In my town average household income is 30k lol. Even surrounding “nice” towns aren’t that much higher
I guess there’s places where people must make so much money
Oh definitely these are national numbers. Even just state by state starts to vary a lot
West Virginia, or something?
Lmao rural Illinois
The heck? A ton of my friends are making like 40k… I guess they’re still within the bell average.
Oh that’s the fun part. Everyone discusses mean and median. Mode is in the 35-40 range last I tracked it down. (it wasn’t easy to find and I have my theories about why)
If I had to move to my current area now, my rent would be around 50% of my income, and that’s with a job that used to be able to support the whole nuclear family bullshit as little as 20 years ago. I’m like $2k below median family income by myself.
This situation has turned into a real cock for so many people.
The place I got my mortgage through sends out emails regularly with updates on my home value, current rates, and other assorted stuff. I originally bought this house at the tail end of 2020. It’s not the best house around, still needs work, but it had the room we needed, was in our budget (220), and the payment was low because the rate was great (2.75). Our original plan was stay here a bit, get rid of some debt, and then maybe try to find what we’d like to be our forever home, wherever that may be (we’re 44).
That idea went south in a hurry. What once probably wouldn’t have been worth sinking extra money into to fix, may now be the only choice. The aforementioned newsletter has a section where it shows what you could “save” at current rates by refinancing or taking cash out. The most recent one said I could “save” -$213400, meaning if we refinanced to take cash out to fix things up right now, it would cost us the entire price of the home yet again, on top of what the home and interest will already cost. Where a home in the 400’s was achievable before, our home in the 200s would nearly not be now.
I feel terrible for people having to try to achieve home ownership at this point, or probably for the rest of the decade. On the one hand, I understand how fortunate I am to have gotten in when I did, and to have a home period; on the other, like many, I’m now essentially trapped, which has the ripple effect of keeping both rates and prices high because most people aren’t going to trade a sub-3% mortgage for 7%+, assuming they can even find a place to go at this point.
Add in corporations branching out into a new area to do their level best to eliminate the concept of ownership for the majority of people, and politicians focusing on the more serious global issues like who goes in which bathroom, and my hope for the future couldn’t be squashed any further if you put it in a hydraulic press.
Real estate will crash, eventually. Hard to predict exactly when and why, but if history is any guide, a market crash eventually is practically inevitable. It could conceivably happen relatively quickly for any number of reasons, but crash it will.
That doesn’t necessarily mean it will become readily affordable - when real estate goes south, a lot of other stuff will be crashing with it. History books are full of monumental calamity. There’s no reason to expect that to change.
And corporations will be right there to buy it all up and further make it worse.
deleted by creator
Hey are you me? We moved temporarily to a place with a far longer commute with the plan that we’d ride out the silliness of the market for about 5 years. That was in 2017. They’ll fucking bury me here lol.
Wow, I just bought a house three months ago, I guess I’m part of the 1%. #feelsweird
Lemmy leans tech and higher income, so yeah, I’d expect a higher proportion.
(Coughbragcough)
Well yeah, the average American is broke. And the average house is expensive. Give me whatever funding this study receives because this shit didn’t need one.
Mao please come back.
Researchers examined the median home prices last year for roughly 575 U.S. counties and found that home prices in 99% of those areas are beyond the reach of the average income earner, who makes $71,214 a year, according to ATTOM.
This sounds like they compared the national mean income to local median home prices which honestly probably makes 99% too generous, it’s probably closer to 100% unless the article is explaining what they did poorly.
The lowest cost of living areas are going to be the ones where these houses are most affordable but they’re also lower income areas normally and a normal person isn’t pulling 71k a year in middle of nowhere Tennessee or whatever.
I don’t really have any idea of owning a home for the rest of my life. Even making enough money to potentially get close seems impossibly out of reach.
First time home buyers in the US don’t need any cash for a down payment or closing costs. You can roll it all into the mortgage. This is how the majority of first time homebuyers get started. You just need a good credit score and enough income to qualify for the mortgage - which is impossible in some cities and easy on a McDonalds wage in others.
Oh I’ve a solution for this the average American can all go and try to buy home in that 1% are so it also becomes unaffordable. Problem solved.
If it’s getting paid for by renters or by owners, it’s not unaffordable.
comrades the .world comments are such libshit lol, count your lucky stars you can’t see them
