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Comment by skohan | Hacker News Reader

The thing is, what's the alternative?

I live in Berlin, and my neighbours are in their 70's. Should they be forced to find a new flat way outside the city because the rent triples over the course of a few years so young tech workers relocating from London can have a place in the cool part of town?

The rental market is different in Germany than it is in other countries: less people own their homes, and getting a housing contract feels a lot more like a permanent thing than when I was living in the US. You pay 3 months rent up front as the security deposit, and most flats don't come with a fitted kitchen so you have to take care of it yourself.

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> Should they be forced to find a new flat way outside the city because the rent triples over the course of a few years so young tech workers relocating from London can have a place in the cool part of town?

yes

why should they get to stay in berlin and have their housing subsidized?

Because civilization requires compassion, empathy, and meeting people's basic needs in a stable manner.

i don't find it particularly compassionate or empathetic to subsidize someone's apartment just because they were living in it when a rent control bill was passed. yes, that person has a claim to some kind of housing, but why should they have a claim to the exact same kind of housing in perpetuity?

Supporting pushing them out while not offering any solution besides saying they have "a claim to some kind of housing" is essentially supporting throwing them out on the street in their 70s period.

that's not what i said. we should have good housing policies, but rent control is a bad housing policy.

Because they lived there half if not all their lives and want to continue to live there. It's as easy as that and it's a legitimate reason.

In the end, the Senate of Berlin is looking out at least in theory for the people of Berlin, not nomad developers or other people looking to move there.

being enabled to continue doing something (at the cost of others!) just because you want to keep doing it is not a particularly legitimate reason

also, if people move to Berlin, they also become the people of Berlin.

> being enabled to continue doing something (at the cost of others!) just because you want to keep doing it is not a particularly legitimate reason

We are not talking about getting tickets to an NBA playoff game, we are talking about housing. If someone has been living in a city for their entire life, it's not reasonable to expect that due to "market forces" they should have to pick up their entire life and move to an unfamiliar place because they can't continue to compete in the market into their golden years.

Every other aspect of living is also subject to inflation. The berlin government is a hero for the poor, this is all it is. The Mietendeckel is not a good thing for a young person or a family but rather for old people and those who have been living in the city for a long time. It creates a class of haves.

The Berlin government considers it a legitimate reason, and since they get to make the rules that's all that matters in this case. If the people of Berlin would disagree, it's up to them to elect a new government with different views on the topic.

"I want to move to Berlin", on the other hand, is not a particularly legitimate reason to kick out a current resident for a newcomer.

Competing for housing exclusively on grounds of wealth also doesn't benefit young workers?

Aside from on HN, most wealth is owned by the old, not the young.

build more housing

why is this mutually exclusive?

Rent control could technically be done by handing money to tennants to then hand to landlords, but in practice it's done by taking money away from landlords. Obviously, that's going to keep landlords from being able to give that money to construction companies.

Another possible solution would be to take money away from tenants and landlords both to give directly to construction companies. That's socialized housing. However in the long run it's not likely to be much cheaper, because it's not like landlords are making that much profit in the first place. The profit in renting is about the cost of capital, the government is not going to do much better.

Wouldn't Vienna be an obvious counterexample of your claim?

Which claim, and how?

Vienna has achieved a very good result with socialized housing, in terms of keeping costs down and providing adequate housing stock. It seems like an example of the government solving the problem of housing better than the market.

Well, it's not like there's a counterfactual Venice with a market to compete with the real Venetian government. But even accepting your claim at face value, all I said was that the government paying construction companies was not likely to outperform landlords paying construction companies by that much, because the best they could do would be to get rid of the (actually quite small) cut that landlords take for themselves. It's not exactly axiomatic that a well-functioning democracy can't sign the same contracts that landlords do, it's just that the amount to be gained is limited by a force all socialists should be intimately familiar with: the tendency of the rate of profit to fall.

First of all, it's Vienna, not Venice. And you don't need a counterfactual Vienna to compare it to cities of similar size and economic characteristics.

> the best they could do would be to get rid of the (actually quite small) cut that landlords take for themselves

Again, I think this claim is easily contradicted by the success of Vienna's housing market. The thing is, if you took the market as it is today, and the government just bought all the housing properties at market rates, then yes you would only see savings in terms of the profit margin which is currently enjoyed by landlords. But if the government takes the role of providing housing as a public good, it can change the incentive structure of the market in a way which benefits renters.

For instance, if your goal is to maximize rent profits, you will make decisions to maximize the year-over-year increase in rent, and you will build more units in a way which maximizes the rental price per unit. That's how you end up with so many shoebox-sized luxury condos in Toronto that nobody really wants and an under-served affordable housing market. If you treat housing as a public good, you make decisions to keep rent prices stable, and you build more housing to serve the need rather than the profit motive.

>If you treat housing as a public good, you make decisions to keep rent prices stable, and you build more housing to serve the need rather than the profit motive.

This argument strikes me as the tail wagging the dog. Vienna has no motive to limit housing since they build such an enormous percentage of it. If rents go up because the government of Vienna doesn't build enough housing, they will be removed from office. Profit is profit. Developers will build anything and everything that they can. The issue lies in the extreme costs involved in building anything new at all, mostly in graft by local municipalities and residents. If a municipality with a broken real estate market allowed housing to be built with less effort, more housing would be built.

Forty percent of Manhattan's buildings could not be built today.

https://www.nytimes.com/interactive/2016/05/19/upshot/forty-...

So would you advocate that there be no zoning/building regulations? The article you linked has a slightly misleading title; it would be more accurate to say: "with today's zoning laws, 40% of the buildings in Manhattan would have been replaced by slightly smaller buildings which allow more light to reach the street." I already find Manhattan overly dense, and I can imagine those regulations were put in place for good reason.

In Berlin, we have had laws on the books forever which prevent tall buildings and excess density, and I'm glad because if developers had their way, they would build high-rises where all the parks currently are, and this would not be a city I would want to live in.

In general I'm not a fan of over-regulation or excess government intervention, but when it comes to housing, I think it does make more sense to treat it as a public good. Government is not perfect, but people should have some voice in how their community develops, and this will not be the case if housing development is left only to private interests.

Is that how rent control is done in Europe? In the U.S. at least, rent control isn't taking money away from anyone. All rent control stipulates is that for the duration of your lease you cannot raise rent a certain percentage, such as 4% a year. Not having rent control allows rents to exceed earned wages for working people and pushes them to the street sooner than it pushes them out of the city.

That's taking money from landlords, (the point of reference is what everyone would have in the absence of a policy) and results in less money available for construction than would otherwise be. In the presence of supply problems you'd have to fix that either by taking money from tenants to give to construction companies (tax funded social housing) or by relaxing rent control so that the money goes tenant->landlord->construction.

If rental prices are rising faster than 4% a year than certain landlords are losing profit aka bearing the cost.

It's absurd to make certain individuals pay for others housing in a random way.

That’s how it was approached somewhat here in Australia. NRAS effectively did give money to the suppliers of housing so that rents could be lower to eligible people.

https://www.dss.gov.au/our-responsibilities/housing-support/...

Also minimize middle-persons and standardize the sales and transfer and ownership contacts (preferably at a state or higher level).

The goal should be to make it easier and more orderly to transfer property ownership, while also providing protection to those making the sales.

The standard contacts should also include enumerations of inspection agencies and what type of inspections were performed (and when), and the various types of insurance which might also be optional and cover protection for buyer / seller / etc.

Sounds great.

We just refinanced and I couldn't believe how burdensome and slow the process was. I don't understand why I had to talk to a person at all.

The German government has absolutely no interest in lowering the taxes they collect from property sales.

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