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Comment by Jaygles | Hacker News Reader

I almost don't want to buy property as a protest to the horrible policies we have regarding basic necessities. Why should property owners be entitled to a major portion of my productivity/success? I'll rent the cheapest apartment I can find until the next housing crash or we have some sensible policy put through that negates the investment aspect of housing.

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That’s essentially what I’m doing, but not as a protest. Prices just don’t make sense to commit to at these ratios. I wouldn’t suggest staying out as a protest though. Maybe look for loopholes - at some point it may make sense to buy a beat up home in an undesirable place for very low and either fix it up and resell or use it for casual purposes and tax incentives.

I'm not sure if this argument makes a lot of sense.. If you're renting, property owners are definitely still acquiring the fruits of your productivity. Moreover you lose out on all aspects of housing security and can readily be displaced if said 'cheapest apartment' stops being so affordable.

If you're imminently expecting a housing crash, then sure, go for it.

My rent cannot go up by more than the Consumer Price Index, and I cannot be evicted without just cause, except in very limited circumstances (owner move in, condo conversion, etc.). How much housing security have I given up?

What I’m really giving up in this situation is the right to make significant improvements to my unit, and such. In exchange, I don’t have to pay for any repairs due to wear and tear. I don’t think it’s a terrible deal, but I would like to own a home, simply so I can have a living space that I alone fully control.

Is property ownership a basic necessity though?

Or is its prevalence as an ideal a product of a burgeoning middle class through the last century?

I understand it's not even so common (or common as a goal) now in continental Europe, they think it's some silly English thing to care so much about home ownership.

It absolutely is a basic necessity unless you wish to remain a serf for life.

that happens anyways. if you own a home and have it paid off, you'll still be paying super high property taxes on that reallly expensive house. and with most 1st world governments taking in 40-55% of all income earned nationwide, we're all just serfs, at the end of the day.

I expect services for the taxes I pay. Paying taxes to my government is basically paying myself because I like living in a functioning society. If the government isn't doing a good job I'll try vote them out. Nothing like serfdom.

The difference is one doesn't have a choice in paying taxes i.e. one is obligated to pay them. If one doesn't pay, one loses their house.

You're still paying them if you rent though, even if by proxy, and I don't think anyone wants to be homeless.

Most people have been serfs for most of the history of civilization. They prefer it to scratching a life out of the dirt in the frontier.

why? there's nothing inherent about owning a house that protects you from having all your surplus income siphoned away. if most of your wealth is tied up in the house, you are still vulnerable to property tax increases from appreciation on the home. not every state shields you from this to the extent that california does, and even california could change the law at some point in the next several decades.

I'd much rather be renting and have $300k in a diversified portfolio than own a $300k house and no other assets.

You'd rather have both though right? Obviously it depends on the market and california is a pretty bad example as an outlier where renting may make more sense but in most places in the world atm buying is the cheaper and safer (as in less chance of eviction at short notice) option. On the flip side renters only pay for increase in property values and never gain. Real Estate is a major wealth generator for people who get on the ladder. Finally you can't live in your 300k diversified portfolio if the market crashes.

I would only prefer a house over stocks/bonds if the price-to-rent ratio was very low and I could purchase a house I liked for a small fraction of my net worth.

> Real Estate is a major wealth generator for people who get on the ladder.

ultimately this comes down to luck and how much of your income you spend on housing vs put into investments. there are certain locales where home prices are skyrocketing, but over the long term, average home appreciation is basically flat (but with lots of variance). [0] actively investing in rental properties is a different story, of course, but involves a lot of work, too.

> Finally you can't live in your 300k diversified portfolio if the market crashes.

sure, but rent is only about half of my monthly expenses currently. by the same token, you can't eat your house or fill up your tank with it. if you're worried about a crash and/or losing your source of income, you can always rebalance into bonds.

[0] https://en.wikipedia.org/wiki/Case%E2%80%93Shiller_index

When rent is close to or even greater than a mortgage (because the RE market is essentially seized) then I’d say people are having difficulties finding a place to live. Having a place to live absolutely is a necessity. Does no one any good to have people commuting en masse.

Australian tax law is incredibly geared towards home ownership, and the culture of owning your home is very, very strong. See https://en.wikipedia.org/wiki/Australian_Dream.

Personally, most of the people in my age cohort (mid 20s) who've bought homes, have bought in areas considerably further away from the city than they were raised.

I think this is an expectation thing. We grew up in houses that our parents owned in their 40-50's, after building their careers and wealth. Yet we expect to buy them in our 20s. That doesn't align with where my parents were in their 20s.

Your parents were in their 40-50s when you were born? That's certainly not the norm.

Average age of the mother at birth in Australia (which doesn't sound unusal to me, but it's Australia specifically being discussed) is ~30:

https://www.theaustralian.com.au/nation/health/average-age-o...

And GP said 'grew up in' not 'born into', so average mother ~40 at 10 years old and ~50 at 20.

So yes, average Australian baby has a 40-50yo mother while 'growing up', especially for the purposes of house expectations which I'd have thought would more likely be formed over adolescent than younger years.

It's not a basic necessity, but it does give you a lot of financial security, physical security and a sense of permanence in your community, especially when paired with other trends like gentrification. I've got retired friends that rent and have lived in my area since they were children but their pensions/funds aren't keeping up with rent prices and moving out to the country to die is a real possibility. Owning a property would have buffered them against this change. For people starting families today increasing rent prices is taking up more of their salaries, a mortgage goes down relative to inflation, and when you buy a property you can factor in things like which schools your children will go to. A home owner of any age will be able to weather negative events like unemployment or debilitating illness a lot better.

Living somewhere is.

Rents are also high in these very high cost cities.

Continental Europe has places with higher rates of home ownership than the UK.

https://en.wikipedia.org/wiki/List_of_countries_by_home_owne...

Norway - 82%

Spain - 78 %

Italy - 72%.

All higher than the UK at 64%.

Well, in England being a tenant has been a terrible experience for me despite paying premium prices and trying to aim at high quality properties with reputable landlords and agents. I've spent 5 miserable years. So I can totally understand why people tend to buy. Most people I know currently letting are either low income or moving jobs and cities.

You have very few rights (even in comparison to Wales or Scotland). So landlords use you for example to live in a property they plan to sell immediately. Typically they sign a rental contract and shortly afterwards advertise the house for sale. You need to cope with all the viewings, probable breaches in the tenancy (agents will enter the house quite often without notice) and the certainty that after ~6 months you will need to relocate again (which also impacts your credit score).

My experience renting in other places in Europe is, in comparison, fantastic. Totally boring (in a good way) experiences in Scandinavia, Germany and Belgium. Rent, pay, stay undisturbed for years, return keys, get deposit back and go. Also much lower prices.

Why do you live in England and not Belgium? Is it because quality of life is so much better that it's worth the housing hassles?

Just getting stuck in hyperspecialized jobs, so I can't really choose location. But quality of life in Belgium and elsewhere in Western EU is IMHO much better than Southern England.

I really enjoyed, in particular, living in Ghent.

It is a basic necessity to have physical space in which to exist. Property ownership of course isn't strictly necessary; renting is a fine way to satisfy this need. But how can rent prices remain very far below the price to own?

In prior generations, rent was a way to express a preference about longterm vs. short term occupation of a given space, or it was a way for people with relatively little credit or capital to get access to space. But it seems impossible for purchase prices to perpetually outpace rent prices, and it is unsettling to imagine the fraction of the economy dedicated to land ownership growing perpetually.

> But how can rent prices remain very far below the price to own?

I'm guessing you meant this rhetorically, but it relates to something I've been wondering for a while. in very expensive areas, you tend to see a very high price-to-rent ratio. even if you could afford to buy, it might not make sense economically unless you plan to hold on to that house for a pretty long time.

I've been trying to learn more about why high price-to-rent seems correlated with expensive areas, but it's kinda tough to google for when all the hits are just practical guides to help you decide between renting or buying. if there's some deeper connection, it may that rent stays well below the price to own for a long time.

In my locality, I believe the difference is explained in part by local policies that severely restrict new building and renovation of old buildings.

You might not expect such housing supply restrictions to cause land prices and rent prices to rise at different rates. But you would expect them both to rise. There may be real estate speculators investing on a momentum theory, but renters aren't willing to pay a premium based on the past trend in rental prices. This theory wouldn't support unbounded divergence between land and rent prices, but it would support some divergence consistent with what I've seen over the past few years.

I think for the vast majority of people (no complex investment strategy, pay bills and go on with life) home ownership is incredibly valuable, both for stability and security, as well as for a decent investment to leverage later in life.

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