Have you ever tried being a landlord?
Landlords can opt out of the rental market if they aren’t earning enough. Tenants have no such luxury.
It would strongly support homeownership.
If “owners” couldn’t buy up multiple properties and become landlords but could only own 1 homestead...then property values would drop and renters would be capable of affording to own in mass.
Unfortunately, we are about to see in short order what happens when renters stop paying rent in mass and landlords stop paying mortgage in mass.
Hint: the renters and owners (collectively “taxpayers“) will both be robbed by their representatives again, and congress will bail out banks (again) so the banks can foreclose (on owners) and evict (renters).
Great! Housing shouldn't be an investment anyway. There's no reason it has to be; there are plenty of places -- like Japan -- where houses are depreciating assets that expected to be torn down when the owners leave.
Japan has a declining population, which means that rural housing actually can have zero buyers for it, where the population is lower than the number of houses. One in seven buildings in Japan is actually vacant [0].
If their population was increasing faster than housing construction, then housing would actually increase in cost.
[0] https://www.bloomberg.com/news/articles/2019-04-29/japan-s-s...
The reason prices aren't high is that nobody wants to live in an old house. "Old" being 15 years old or more. Even with renting apartments, if it's older than 7-8 years old, agents will almost warn you that the property isn't exactly fresh and sparkling, but it's still not bad. If it's a pre-90s house, it's considered basically unwanted and they'll all but try to give it away. Meanwhile, 90s homes in the US are still marketed as pretty new, and demand seems to be higher for older homes than newer ones. America also has loads of empty houses. It also has loads of property owners who refuse to lower prices because their ego is worth more than their property. Apparently about 1/8 American homes are currently vacant, and the population isn't declining. Price and desirability are the problems.
Japan, is also no stranger to real estate bubbles, having experienced perhaps the worst real estate bubble in modern history in the 90s:
https://www.investopedia.com/articles/economics/08/japan-199...
"At their peak, prices in central Tokyo were such that the Tokyo Imperial Palace grounds were estimated to be worth more than all the land in the entire state of California."
http://www.indianapolisrecorder.com/news/article_b27a7cf6-1d...
https://www.reddit.com/r/UrbanHell/comments/5gx86v/russian_a...
https://commons.wikimedia.org/wiki/File:Petare_Slums_in_Cara...
Authenticity of the reddit post aside, do you have the slightest knowledge of urban development in the Soviet Union, or like, anywhere, or do you just regurgitate links?
A lotta shit got built 'cause you need to house a lot of people after your country's major urban centers got basically raized to the ground, the surrounding countryside along with it, alongside continuing rural->urban migration. Ain't particularly easy to do that well while also trying to recover your economy from a massive fucking brutal invasion.
Yes, Khrushchevkas aren't exactly marvels of architectural longevity; they were never intended to be. They were supposed to last maybe 30-40 years at best, and they're still standing. Sure, they're shoddy and they look like shit now, the countries that built them lacked the capital to replace them as intended--that's another history lesson, but whatever. You mock them for carrying on shambling well past their intended use? They should be lauded for lasting as long as they have, with what limited resources and tight constraints under which they were originally built.
Point is, you want the government to cheap housing and fund it as such, it does so, and the output sometimes ends up surpassing your original goals! You put funding into producing good housing and government can do that too! You ever been to Singapore? You ever hear about the sprawling abject rotten slums of Singapore, that dominate the whole of the nation? No? Curious that.
Would be really fucking strange to hear that a government could build a lot of good housing for its populace and still succeed economically, I suppose, but hey, they did it: https://en.wikipedia.org/wiki/Public_housing_in_Singapore
Do you have any additional info?
Renters are locked out because they don't have down payments. They can't save down payments because rent takes all the extra money.
The sort of instability that renting creates, contributes heavily to the poor performance of children in school.
Why should banks give out personal loans where someone can do whatever they want with the money? Why do credit cards exist? Why are brokers allowed to provide margin accounts?
From the perspective of a bank it's a great deal. Either they get the premiums and interest on a loan or if the landlord defaults, they get the asset. But think of it in terms of the community. This helps concentrate wealth for the wealthy. People with lots of assets are more likely to qualify for a loan and they can afford higher house prices than those with less. This can cause cost of housing in residential areas to increase and lead to locking out new residents from becoming home owners in the area they live.
> Why should banks give out personal loans where someone can do whatever they want with the money?
Personal loans have higher premiums, higher interest rates and lower limits because they are not backed by high value assets.
> Why do credit cards exist? Why are brokers allowed to provide margin accounts?
The simple answer is that they are profitable to the providers.
I don't think high eviction rates are signs of a healthy society.
What profit? The landlord has a $10,000/month mortgage payment and 10 tenants who pay $1000/month rent. If three of the tenants stop paying their rent and you can't evict them and replace them with paying tenants, you still have a $10,000/month mortgage, so now you have to raise the rent on the others by >$400/month each just in order to make the payment.
It's systemic, so all the other landlords are in the same situation and have to do the same thing, which means you can raise the rent by that much without losing tenants to the competition.
The people getting the extra money that the other tenants are paying aren't the landlords, they're the tenants who are living there without paying rent because they can't be evicted. And you can imagine what happens when the other tenants can't afford the higher rent and stop paying too.