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Comment by anigbrowl | Hacker News Reader

I need something better than anecdotal evidence for your claim that tenancy rights are the primary problem. You can find horror stories about problem tenants in any city, same as you can find horror stories about terrible landlords. Do you have quantitative evidence that documents the scale of this problem? Property vacancies, speculation, rents, and related issues are hardly unique to Paris; this is an unsolved problem in economics precisely because living accommodations are not simply fungible commodities and applying crude economic models to complex economic situations leads to inefficient outcomes.

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First poster has a point, no need for people to live abroad and to rent their places to have problems...

Laws in France are really leaning towards the tenants. First there's the "trêve hivernale" which could be translated as "winter truce": from November 1st to March 31st, you are not allowed to evict anyone (unless for safety reasons for instance).

By law, when the tenant ceases to pay rent, the owner must inform the renter through a bailiff about that. Then after 2 months, if the renter still hasn't paid, the owner can go to court.

So really, just at that point, if you did the bailiff thing after your tenant failed to pay for 2 months (because you're nice and didn't do it after just 1), by the time you go to court (because you have to wait 2 months), you're already due 4 months of rent.

The judge has the final call about the eviction delay, up to 3 years. So if you are lucky (not possible) and see the judge at that 4 months mark, judge who decides your tenant should be gone, you'll have to wait another 2 months. Because you can't legally kick out anyone without letting them a chance to find something else: they have 2 months to do that.

So that's 6 months already. I'm sure you can at least add 2 or 3 because courts are slow.

If winter comes, and unlike in Game of Thrones, it comes every year, you'll have to wait for the winter break.

The bottom line is on average, an eviction takes 18 months...

I could add the judge can give a payment delay to the tenant: from 2 months to 2 years.

You can google it, it'll be difficult to find a good translation but: https://www.french-property.com/guides/france/working-in-fra... https://www.french-property.com/guides/france/working-in-fra...

Then comes the nightmare of getting rid of someone who pays (because got want to, for some reason, like having a friend renting your flat).

Basically, it is impossible. Strictly impossible during theft compulsory 3 years rent contract and almost impossible after if the renter does not want to leave.

If you want to sell the flat, good luck as week : not possible during the rent period (except with the renter in the package) and you have to give the renter priority in any case.

I do own rental properties, including 2 in France. While it is difficult to get rid of a non-paying (or worst paying only time to time), it is not impossible to get rid of them. I did after 3 years of being payed on and off. One thing the landlord can do, is get all the social aid (Caisse d'Allocation Familiale) being sent directly to the landlord. So, at least the landlord does get something every month. Then as mentioned you can go the court route. You can also not renew the lease (granted, in France a lease is 3 year, so be patient) by sending an letter 6 months before the end of the current lease (which I did). The bad tenant left with about 4 missing rents (and damages in the apartment), but I obviously did not give back the deposit. All in all I did lost some money, but that is part of rental properties, that is not CD (Certificate of Deposit) with fixed interest. Like most investments, it incurs some risks too.

Having been a renter for years, I understand that renters need some protections and also an easy way out if they have some financial difficulties. There is a balance to find between landlord and tenant. If we could make easy for a tenant to move and find a more suitable place, I am sure tenants will be less willing to stick (and eventually not pay) when their financial situation changes (e.g. loss of job). But right now, it is almost impossible for someone who just lost his job, to seek a smaller/cheaper place. Hence he gets stuck with the current place, with a rent that is not matching anymore his income.

>All in all I did lost some money, but that is part of rental properties, that is not CD (Certificate of Deposit) with fixed interest. Like most investments, it incurs some risks too.

But are they worth it? Unless you're making a really large profit, it seems like you're far better off just putting your money into an S&P500 index fund or other stock funds. With a stock fund, all you have to do is put your money in there, and wait. With a rental house, you have to deal with repairs, collecting rent, using the legal system when tenants don't pay, etc. Unless you're making a 100% profit, I fail to see how rental property makes any sense as an investment at all in that environment.

One word: leverage.

While your $50k investment is making 6% ($3,000/yr) interest in an index fund, my $50k downpayment on a $500k house is making average of 6% ($30,000/yr) equity growth. And I get to deduct the mortgage interest, taxes and maintenance costs of the house while someone else pays most of the mortgage.

I should really have kept that property...

You seem to be assuming that property values are rising. The 2008 crash proves that's something you can't count on.

If you look at a few years out of the last 5 decades, sure. If you look at the trend over decades, which is the timescale I'd expect to be looking at for a real-estate investment, yes, prices are rising.

when the 3 years rental period is over, you may end the rent (as the owner) only under specific conditions (see for instance http://www.dossierfamilial.com/immobilier/locataire/locatair...).

It is not like you can end the rent to get another renter (except if it is a close family). This is really crazy and have always been a turn - off for me when wondering about investing in flats (I am French)

It is a very well known problem in France. Tenant protection absolutely bonkers here. It actually hurts people looking for apartments as well... you have to earn triple of the rent, you have to give up all of your personal information (e.g. Three years of tax returns) AND have two people to sign a contract that they will pay if you stop paying (all of this is in additions to insurances the landlords already have from banks). As somebody without a family in France to vouch for me, is has been a total hell to rent a place here every time.

Sadly quantitative evidence (i.e. statistics) also don't prove anything.

All I can tell you is that here in France property squatter have rights, and the more the original owner awaits before calling the police, the less he has a chance to recover his property and evict squatters. I would be interested in knowing if others country have the same laws ?

"Sadly quantitative evidence (i.e. statistics) also don't prove anything."

Still better than a single anecdote on the internet.

Plenty of other jurisdictions have similar laws. Adverse possession is a common law legal doctrine designed to prevent the non-use of resources by an absent owner.

It varies from place to place. What you describe is, here in the US, generally called "adverse possession," but frequently it requires the "squatter", as you call it, to make his intention to take ownership known (e.g. by placing a document in writing with the local government department that keeps real property documents).

I see nothing wrong with this. Private property ownership is protected by the government, but almost always predicated on the assumption that the property will be put to use to the people it grants ownership to. Owners have the right to let their properties sit idle, but not without risk. This is a good thing: property is a finite (often arbitrarily and unfairly divided) resource. In my view owners have an obligation to put their property to use, and if I had the power to do so I'd make having idle property financially onerous (at best).

I need something better than anecdotal evidence for your claim that tenancy rights are the primary problem

Protecting predatory tenants is a problem but the big one in almost all Western cities is zoning: https://object.cato.org/sites/cato.org/files/serials/files/r....

Contrast this NIMBY approach with, for example, Japan's system: http://www.ft.com/cms/s/0/023562e2-54a6-11e6-befd-2fc0c26b3c....

>the big one in almost all Western cities is zoning:

Or property taxes that are far, far too low which allows the land value to be captured by landlords rather than the community.

>Contrast this NIMBY approach with, for example, Japan's system

Where people get 100 year multigenerational mortgages...

I guess how you frame the property tax policy debate depends upon how much of the national income you believe should be earned through rent and interest entitlements and how much should be earned by doing actual work...

Currently in most western countries there is a drift from one towards the other driven by targeted tax cuts.

Thanks for mentioning property tax, one issue that is sadly overlooked in practically every discussion. In Germany there's a small initiative of cities and citizens that aim to restructure property taxes to actually incentive productive use of land: http://www.grundsteuerreform.net/ (unfortunately only in German)

Basically it aims to remove all taxes on buildings and _only_ tax the property it's on, at a rate that is propertional to the value that society (the people living in the city around the property) and the city itself (through infrastructure) provide to the property.

The tax would then strongly encourage productive use of the land instead of speculating with it.

It's encouraging that LVT is actually happening somewhere.

What is LVT?

Land Value Taxation.

Yes and the properties in Japan are cheaply made, unbearably uniform, tiny and expensive even by Paris's standards.

No-one has been able to show anything other than property developers are good at price gouging in any regulatory environment where the government does not build houses.

The source article on vacant homes is practically anecdotal. It's not even successfully argued that vacant homes are a meaningful problem in its listed cities.

No methodology is provided. (Spoiler: it's different for each city which are therefore uncomparable). No baseline metric is given. No supporting or relative terms are present. It's only worth is starting a conversation.

Social sciences cannot very well prove things by experiment, but one statistics you can look at is the price difference of apartment sales depending on whether it is vacant, or occupied by a tenant.

In a normal housing market there is not much difference. A bad tenant is a risk but a good tenant coming with the apartment is an asset.

In Paris, the price difference is significant, with sales prices around 10 % lower for an apartment which has a tenant, depending on area and type of apartment. This shows that tenants are seen primarily as a risk and the housing market is off balance.

This also means that an apartment owner does not wish to take the risk of leasing out in the short term, and the regulation actually increases rental housing shortage.

IMO you are being a bit lazy here not researching the issue yourself. These kinds of comments are easy to make but hard to respond to. Do your own research and respond with what you find before asking OP to do the same.

ptaipale is the one who made the assertion, the onus is on him to provide evidence, not the person questioning the assertion.

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