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> 1. Abolishing landlords is not the answer (I see a lot of people suggest this).

I am so baffled by this. Seems like a mental smokescreen for NIMBY homeowners to protect themselves from the realization that they are the problem.

If every landlord was murdered today and replaced with a homeowner, there would not be the slightest impact on either the home price crisis or its root cause, the artificial restriction in supply caused by NIMBY zoning and regulations.

In fact, the supply pinch would probably get worse. Big landlords can benefit from expanded supply if they own that expanded supply. Single-home homeowners see only the risk of disruption to their environment. A city full of single-home homeowners might never build anything, anywhere, ever again.

(Just in case anyone asks, I am not a landlord. I'd have to be a multi-millionaire to even contemplate it in my area.)

Living in EU. Please tell me what should I do with my money, so I won't starve when I'm on pension in 20-30 years? Current situation is, that my lifetime savings are being eaten by inflation due to rising wave of social benefits given to everyone in exchange for votes. Real estate is virtually only option, that does not require additional part-time work, in order to turn profit beating inflation.

Why not Vanguard Total Market Index? That's what my 401(k) is in.

The stock market is overvalued and risky but so is real estate. I'm sure there are still lots of better-than-nothing companies to invest in.

You want to put money into things that are going to be making money in the future. Real estate is one, but businesses are another.

I have some ETFs/stock too. However: * lack of diversification seems unwise. * volatility and risk seem to me to be higher on a stock market. * taxation is approx twice higher on capital gains. Costs of investing on more mature markets, than local markets are not helping too. * my children will need a place at some point. Giving them some option seems to be wise, given what's happening to real estate market (I see some irony in that statement, but when in Rome...)

In general I would much prefer to not deal with real estate, but it simply would mean a lot bigger risk of a few unpleasant decades at the end of life.

All well and good, but notice that you moved from "I need real estate to appreciate faster than inflation or my family will suffer" to "I'd prefer to have real estate as part of an optimal investment portfolio because I believe it will produce better risk-adjusted returns". We're not really talking about actual desperation here. We're talking about your desire to maximize your family's well-being.

If that's what you care about, it would be wise to consider the impact on society as well. Society doesn't do well when resources are only accessible to a wealthy elite, and a stunted society will hurt your childrens' future. So maybe it's not such a good idea for real estate to be a scarce, rapidly appreciating asset, if it leads to unaffordable housing and economic desperation for the masses, political instability, etc.

I'm not saying don't invest in real estate, only that the political conditions that make real estate a good investment may be bad for society at large.

(6) - what do you mean by “should have the right”? Anyone has the right to buy a trailer park, including The residents.

I mean if a sufficient number of residents support it, they can forcibly purchase the land or building they're sharing as a cooperative.

Of course, they should pay market rates for it. Think of it as a private application of eminent domain. As far as I'm concerned, the rights of people to live in the homes they technically own without being extorted by a REIT who owns the land those houses sits on trumps property "rights" of REITs.

Worldwide this sort of thing does happen. Example: the UK system of leasehold/freehold.

Guessing GP means “have the option to buy”, regardless if the current owner is selling.

> 1. Abolishing landlords is not the answer (I see a lot of people suggest this). Ownership is a barrier. Rental properties are useful.

This is circular.

A big part of the reason ownership is a barrier is that landlords—usually large corporate ones—own all the available properties in an area, and have exactly zero intention of selling individual units. This, of course, raises prices.

There are two big problems with your statement:

1. You ignore the big problem that buying a house shouldn't be the only way of finding somewhere to live. Like, that's just not realistic. You're 18 and you want to move out of your parents' house. Is your only option really to buy a house while working at Dairy Queen?

2. The idea that a market can be cornered like this is overly simplistic and history is littered with the bodies of those that have tried. Like anything, the pendulum swings back and forth on this. You only have to go back to 2008 to a time when the market was flooded with available units. What you have now is people who 100% have legitimate concerns that I support but tend to overstate the doom and gloom as being forever. Obviously that doesn't help them now but the idea that someone can forever lock people out of the housing market just doesn't hold water. Structural changes in the market will come along and change the equilibrium.

IMHO one of the most damaging things to the housing market has actually been AirBnB.

> Is your only option really to buy a house while working at Dairy Queen?

Why shouldn't there be houses—or apartments—you can afford to buy while working at Dairy Queen?

Because NIMBY homeowners would prevent the construction of sufficient supply to drive prices to that level of affordability.

People are so fixed with the models of what has happened and won’t even consider what could be done.

You know you could buy a home with 0% down. The government could back the loans and have very low interest rates on these loans. It’s all possible - but we’re stuck in such a strong capitalistic mindset that we ignore other possible ways of running the country and imagining home purchases.

There’s also no reason we couldn’t have the government building beautiful and delightful buildings that are also attainable for everyday workers. It’s because we are stuck in our capitalistic mindset and so anti-government that we cannot imagine other ways of doing things.

Government regulation, voted in by NIMBY homeowners, is the primary reason we have inadequate housing supply. So what do you think will happen when the government proposes building housing? Will the NIMBYs just roll over and take it if the government does it?

You need a strong legislative body - which of course - we don't have. They're in the pockets of corporate interests and billionaires. They have no interest in addressing the needs of the people.

But it's totally doable btw. See China. They use eminent domain like a mofo.

IMO, an important political heuristic is "don't expect more government intervention to solve problems that are caused by government in the first place". In this case,

1. We have expensive housing because we don't build enough.

2. We don't build enough because of anti-growth city regulations enacted by NIMBY politicians elected by NIMBY homeowners.

Corporate interests and billionaires aren't the ones that keep anything from getting built. They're your homeowner neighbors with lawn signs that say "NO ON EVERYTHING" each election season.

In a supply pinch, government subsidies just inflate home prices further, pouring more money into home sellers' pockets, the same way government-subsidized college tuition has poured more money into colleges' pockets. You can't solve a government-caused supply problem with government subsidies. Instead, you have to ask yourself the hard question - do I want much more housing? Do I want economically dynamic cities to grow, with all the problems that can bring? Most voters in these cities don't, and that's why we have the expensive cities we have. There's not enough to go around, so what supply there is goes to the highest bidder.

Now, regarding China - it relies heavily on private developers. The CCP learned decades ago that people just aren't motivated to work unless they own the rewards. This led Deng Xiaoping to transform China into an effectively capitalist economy ruled by a one-party corporate technocratic autocracy. The end result is that China is still owned by rich people, they're just rich people in the Communist Party. If you think money and power are uncomfortably close in the US, wait until you learn about the CCP! If the US government had the power of the corrupt Chinese political elites, Jeff Bezos could be disappeared for months (or forever) without any explanation whatsoever from anyone, and everybody would have to take it in stride. They can build infrastructure, yes, but it comes at a heavy price. And most people are kept out of the cities by the hukou system, which is NIMBYism on steroids.

This isn't even remotely true. There isn't a single multifamily housing company anywhere in the US that owns more than 1% of the rental units (that's just rental units, not even all properties) in any major urban area. Housing is quite possibly the most commodified industry in the US outside of agriculture.

For point (4), people who live out of state still have to pay property taxes on the property they own in another state.

That's true. Typically that property tax rate is higher for out-of-state residents too.

I'm suggesting going further than that: owning property in that place makes you a tax resident. That means all your income is subject to state and city taxes. You'd still get credit for taxes paid in other states (as you do now for the most part) so you don't get double-taxed.

But let's stop giving tax breaks to people who reside in Monaco for tax (ie no tax) purposes and park their money in real estate in London, SF, Vancouver, NYC and Hong Kong.

Great write up. I hold the same view but hadn't written it out in such a way. Thanks!