The welfare effects of eviction policies
marginalrevolution.com
marginalrevolution.com
The mega-corp landlords are much more savvy when it comes to dealing with grifters and con artists, to the point that they will usually avoid taking them on as tenants (e.g. via extensive background checks). Small-time landlords are getting savvier, but not at the same speed.
> Which is increasingly common.
And given the above, they will be probably become the norm in a decade or so.
I'm not terribly sympathetic to landlord in this situation. As far as I can tell, it's the greedy, lazy landlords that get taken by these people - if you follow the letter of the law, keep your premises in good shape and document everything, it's pretty hard to be taken. Oppositely, a lot of landlords skirt the law on a regular basis.
Easy, by having the government send Men With Guns to confiscate it from you.
You don't just get to send men with guns to take large chunks of peoples wealth without dire social and economic consequences. To believe otherwise is pure fantasy.
In many places in the US we have government officials who decide who gets to live in which house and how much they will pay for rent. Tenants are part owners in properties, sometimes majority owners.
OK, sounds promising
> ..use that tax to subsidize housing
record needle scratch sound.
Subziding housing drives up the price, because it increases demand for housing. Have we not learned this lesson? After so many years, this basic economic fact is still tripping people up?
Please, stop with the housing subsidies. Why do you want to make housing more expensive?
Also, politicians have to be accountable for the subsidies which means that restrictive zoning will burn a pocket into the local budget. They don't give a damn about losses due to rent control. I.e. they privatize political gains and socialize the economic losses.
The idea that the price of housing will not increase if a good is subsidized because the supply isn't "prevented from increasing" is so confused and wrong it literally makes me sad.
We have the data of house prices rising as a result of subsidies. Housing is half land and half structure, and in constrained areas, 80% land and 20% structure. Land does not increase. Moreover even if housing was all structure and land was free, the subsidies cause houses to become bigger, as people can afford more structure, leading per house prices to rise.
Then you continue with a string of cliches, "privatize gains" etc. And a complaint that other people don't care enough.
Well, OK, but what of it? We don't shoot ourselves in the foot because other people don't care.
Adopting policies that make the world a worse place just because you are morally outraged is a terrible way of doing public policy.
So we're saying that making it so tenants can't defend themselves against illegal evictions is going to increase the housing supply incrementally?
I think there's definitely a problem that needs to be addressed, and that many landlords are bad actors in many markets, and that may tenants are bad actors in many other markets. I'm not even sure that landlording makes sense, it's rather feudal. I'm pro realistic rent control. I just think that, short of throwing away the entire system and making a revolution (that would kill millions), we should approach the problem from a carrot and stick perspective, not a stick-only perspective.
If you want to make eviction hard for the average tenant, fine. But if you leave it at that, where's the incentive for renting to riskier tenants? There's nothing re-balancing the risk exposure, nothing that makes up for the risk-adjusted expected loss of renting to a risky tenant. If we want these risky tenants to be housed _while_ preventing undue evictions, we need to fix up the incentive structure so that landlords still have something to gain from renting to risky tenants. Otherwise, why would they do it?
The only "punitive policy" that's being discussed is giving tenants free lawyers so they can defend themselves in court.
I don’t know where this image of the “yeoman” landlord is coming from, these people are clearly financially stable enough to speculate on a human necessity but also want to be able 100% shielded from any risk? That’s not how business works, though maybe that is how business works now given how many companies and banks US taxpayers are expected to bail out.
Well, the state does provide lawyers to the prosecution side, since the prosecutor is the state.
No number of lawyers allows a tenant to just flagrantly break the law.
The thing is, many landlords casually break the law and generally benefit from doing so - they fail to make timely repair, they take deposits unjustly and so-forth. Most tenants put up with this since fighting it isn't worth their while - the advantage the small opportunistic landlord takes is like a tax that tolerable though not pleasant.
Occasionally you get a sort of cagey and kind of crazy person who turns around and uses all the shenanigan of the sloppy landlord against them. The "grifters" - I've seen these types. Sure, they too will break the law but they get their mileage from the normally sloppy and abusive behavior of the small landlord.
The original poster I replied to on this thread believed that legal aid for tenants is what allowed these "grifters" operate. I dispute that and even more dispute the idea that not legal giving tenants legal aid would increase the housing supply. As I noted, the so-called grifters know the law and removing their free lawyers isn't going to change much. It's average tenants who need lawyers since they don't make a business of staying in apartment when a landlord is trying to legally or illegally evict them.
Further, a change making it easier for a landlord to illegally evict a tenant wouldn't improve the housing situation - the illegally evicted tenants would be looking for more housing and the opened-up units would be at a higher price.
The other issue is that you can't 'win' in court against someone with no assets. If they owe you thousands, haven't paid rent for months, severely damaged the apartment.... they don't have any assets to seize. And a judge, especially in a blue state, is not to authorize anything harsh. They can essentially not pay rent or badly damage your place with zero consequences
The proportion of rental units owned by individuals used to be a large majority, but has been falling and recently dipped under 50%. As of the 2018 Rental Housing Finance Survey [1], there were 48 million rental units in the United States, with ownership breaking down as:
41% individual
37% LLP, LP, or LLC
3% real estate corporation
3% nonprofit organization
2% general partnership
2% trustee for estate
2% real estate investment trust (REIT)
10% other or unreported
I don't have numbers, but I'd imagine it looks even more skewed in the direction of professional landlords if you looked at major cities.
> 37% LLP, LP, or LLC
All of the individual real estate investors I know wrap their rental properties in an LLC. It's trivially easy to set up and manage an LLC these days.
Unless those numbers are somehow separating out individual LLCs, I would assume a lot of those LLCs are owned by singular individuals.
I would bet that a good chunk of the trend you’re asserting is just small time rental property owners increasingly using LLCs to limit their liability.
In fact, as of the time of that report, one of the largest real estate investors in the US, Blackstone Group, was organized as an LP and went in that category (they changed forms to a Corporation in 2019). A few large real-estate investors still organized in the LLC/LP/LLP form are the BH Companies, UBS Realty Investors, Harbor Group International, AEW Capital Management, and Invitation Homes.
No, creating an LLC for your RE business does not require the use of a management service. The exact same individual landlords can own properties through LLC as without; the LLC just grants them some liability protection.
The rate of increase of professional management is also pretty high: the 2015 survey had 43% of properties professionally managed, which had risen to 54% by 2018. I'd be willing to bet it's more like 60%+ now as there's been quite a bit of buying into the rental market by large investors.
None of this is correct. An LLC is just a legal structure you create for a few hundred bucks using a two page document online. They're not 'passive investors buying into an asset class'.... you can still be a mom & pop with an LLC. I'm sure most tiny retail businesses are an LLC too.
I didn't personally see the statistics about professional 'management' on the page that you linked, but that doesn't make one a large-scale investor either. Property management companies usually collect 5-10% of the monthly rent, which is a tiny amount of money, so they're incredibly small scale or shady fly-by-night operations. I suspect you saw a statistic that includes the guy that mows the grass and patches the roof, and thought that was 'professional management'.
I think a better/more focused stat would be to understand how many properties or units each investor owns, rather than continuing to misread this table about an industry you're not familiar with. If you own 1-2 small buildings, you meet my personal definition of 'mom & pop operation'
Seems like the net size of a corporation is an indicator of how little we as a society want it involved in our daily lives - the bigger they get, the more effectively they are exploiting a rent seeking niche, in this case literally.
In Texas you can use a series LLC to separate risk between properties with a single LLC, but it is the only state I know of that offers it (*I may be misremembering based on a BiggerPockets podcast from a couple years ago).
Almost all of the issues I've had while renting were with small landlords. Corporate landlords at least held up their ends of leases in my experience.
New York City had a decline in evictions when it was enacted (the decline outpaced nearby areas).
I'd also point out that "investments" in a "free market" aren't supposed to be risk-free. If the landlord can't hack it, whelp that's their problem as a speculative investor.
No one wants a medium income rental due to that. And I'm thinking about being a landlord - as I'm moving - and evicting a tenant that refuses to pay for 6 months while I still need to maintain the property and pay mortgage is prohibitive. The risk there is scary high for what shouldn't be risky.
I'm not making this up and these are not my rules or opinions. It's just the logical conclusions these people come up with, given the environment they're faced with.
this dynamic will always be true: "folks with higher incomes are seen as less likely to trash the place, less likely to sue, less likely to stop paying"
Basically, this is somewhere I think govt. _constructive/supportive_ intervention is needed, because today's punitive policies creates economics that don't allow a humane end result.
I think we should build more single unit affordable housing! And shove it all over the place, in affluent neighbourhoods! Help people leave their problems behind.
This thread is getting deep for HN and it's hard to respond, but I had shoved my random thoughts on this in https://twitter.com/AntoineGrondin/status/145489614700107776...
We know how to plan this properly. Mistakes will no doubt be made but there is no reason to think they will be this obvious.
Almost everything you describe is the effect of a housing shortage. The new houses wont happen overnight, it takes quite a bit of time to create a surplus.
if they could fix the housing crisis my bombed out city straight after ww2, I'm pretty sure the US is able to do so 80 years later with modern construction methods.
https://www.quora.com/Was-Adam-Smith-against-landlords?share...
The Soviet Union didn't have landlords to deal with, but the housing situation was not any better - just instead of apartments being unaffordable, you'd get in a queue for public housing that was like 20 years long...
At the beginning of their project, many people lived in huts so the step up to small stark apartments was a huge step up for millions. After a few decades though, they appear to have failed to improve their housing infrastructure at a fast enough rate. I don't know exactly why.
Some sources I've read say that once Krushev (and his base of support) were in power, they redirected resources into consumer goods to try to match western lifestyles too early. The previous plan was to constantly reinvest in heavy industry which creates exponential growth by providing the material basis for more heavy industry. This shifting of resources away reduced the rate of growth as the population continued to grow and resulted in a stagnating standard of living.
This makes intuitive sense to me so far, but I have not done enough research to say this is conclusive.
I would point out that in the US, we have the perception of being able to move wherever you want given enough money. However, in reality we are restricted (queued) by the affordability of housing and moving. The people at the top do have real freedom, but the bottom sections (most of them not present in this highly paid programmer forum) have very little.
That aside, you can't look at economics of USSR in isolation from its politics. For example, under Stalin, most peasants were effectively tied to their land in kolkhozes and sovkhozes - they couldn't freely move to the cities where the better-paying jobs were, and thus couldn't compete for housing there.
The urban centers had something like 10-20% of the population. If the peasants all moved to the cities, there would a) be not enough jobs and b) no food as no one would be producing it.
And I'm not saying that producing those things is an investment, but rather that Soviets consciously invested into heavy industry to the (rather significant) detriment to the rest of the economy, so as to have manufacturing capacity to produce them.
> The urban centers had something like 10-20% of the population. If the peasants all moved to the cities, there would a) be not enough jobs and b) no food as no one would be producing it.
Well, the peasants wanted to move to the cities because the pay and the overall quality of life there was better. Peasants in kolkhozes were essentially serfs, with the government coming and literally taking the "excess" of their food output away. This could have been solved by, you know, actually paying them properly for that food. But why pay when you don't have to, and would rather spend that money elsewhere - e.g. on industrializing the cities?
One thing to keep in mind here is that Bolsheviks were very much not a peasant party. In the Constituent Assembly (which was directly elected by the population), they were a minority, and the most numerous party was the Socialist Revolutionaries, who actually represented the immediate interests of the peasants. Which is precisely why the Assembly did not rubber-stamp the Bolshevik government, and was forcibly dissolved.
Similarly, in village councils, Bolsheviks rarely had a majority - so they introduced kombeds to override those unruly councils. Also, when the council system was first codified in the 1918 Soviet constitution, the Congress of Soviets (i.e. the ultimate legislative body) had one representative for every 25,000 constituents of urban councils, and one representative for every 125,000 constituents of rural councils - i.e. one factory worker effectively had the same voting power as 5 peasants .
These kinds of things is why there were so many large peasant uprisings in Soviet Russia early on, to the point where they had to use poison gas to effectively suppress some of them.
Taxes on money and land holdings. If you spend your money you do not "win" because you pay transaction taxes (VAT etc) or you increase your exposure to risk in the financial markets. If you don't spend your money you lose because you pay the wealth tax for nothing.
The reason why a land value tax works is that land already exists. It's supply is inelastic. The owner of the land did nothing to create it. So taxing the owner for holding onto land will not discourage him from working (building a house and renting it out). The tax revenue can be used to pay for public infrastructure like transportation then the value of the land goes up which will directly fund the infrastructure. A holding fee on land discourages speculation because the expected value of holding onto land without utilizing it is negative. The reason why land speculation is so profitable is that location is a monopoly. As the community around the land develops the speculator benefits off the work other people while doing no work himself. It's especially bad when income taxes are used to fund infrastructure. As the government does more infrastructure projects and charges higher income taxes your rent will go up as the value of the land goes up.
Just a thought experiment: A single tax implementation of land value taxes implies that you've paid your taxes by paying rent. Rent would still be expensive but products and services would be cheap and your income would be higher.
I think it'd make sense. It's beneficial to govt. to keep people productive and ultimately off the street. Hence (in a capitalist system) they want to encourage the market to provide housing to people who would otherwise not get it. If the government came involved into transactions as a guarantor for people in need, and provided incentives and reassurances to landlords that they would not be disadvantaged if they provide housing to those in needs, I believe there would be less homeless people in the street, and more generosity from landlords.
E.g.:
(1) if I have no upside and a high risk exposure in providing housing to a recovering addict, will I do it if I'm then unable to evict that person when they fall back down into addiction? No, I wouldn't, even if in my heart of heart I wish I could help them.
(2) if on another hand, the government came and said "we'll guarantee this market rate, and will facilitate eviction proceedings and pay for repairs if things don't work out", would I be willing to risk it and rent to that person? Probably yes, there would be enough structural support to encourage me to do some goodwill help.
The problem is that the stick presented in (1) is what's going on right now, and there's no carrot (2). It's basically the policy makers telling landlords: all you, don't you dare taking in tenants who are a higher risk! Because if you do, we'll be watching!
* * *
In coordination with this, I think a smart policy would be to combine this idea with something else: instead of trying to build affordable housing projects, try to spread these initiatives around. Avoid the creation of ghettos. If a govt. agency was to support someone's tenancy, the agency should try to spread these people uniformly around town, mixing them with all strata of society, instead of putting all these people in the same geographical area. This would encourage reintegration in a constructive environment. People living in their walled gardens would be annoyed, but ultimately, the people in need of help would be allowed a chance to heal in a safer environment.
So, I was already broke from thousands in unpaid rent, then got notice that she was fighting the eviction and would be represented in court by a pro bono lawfirm. So I had to scrounge my last $ and remember not to fill up my gas tank all the way, to hire the town's cheapest attorney to go in and settle, letting her stay an extra month free of charge to agree to leave. Finally she illegally overstayed that and only left the day before the cops were to show up and forcibly remove her. This is all while she's living on gov't cheese and blowing her money on booze and festivals.
In all I was out many thousands of dollars I didn't have and basically couldn't sleep in my own rented room for over a month, and got fought in court by fancy lawyers paid with tax-deducted charity money. I spent a while seriously considering, and my only other option would have been, to end my own lease and leave and let my landlord deal with trying to remove her.
So no, I was actually at risk for becoming homeless due to this situation as the "landlord", and I get fairly angry when its described in this blithe way as if the person fighting the eviction is always the poor little guy and the "landlord" is always BlackRock having to eat a 0.001% hit to their profit margins.
It is only fair way for system to work.
I was 1/2 a day """""late""""" with rent (as in, it was the 1st, and i didn't have it when the landlord came to see me in the morning, as i was on my way to school) came back to find the locks changed, was told i was evicted and even if i paid rent for the next month, all it would get me was my property back.
(reminder, they were demanding i rent for the next month, that hasn't happened yet, as condition to retrieve my property, while telling me it wouldn't result in me being allowed to stay in said unit i just paid the next months rent on.)
Had to use legal counsel help to put a stop to that bullshit.
A few didn't pay me for the last 5 months, and things did not work out with the state.
I will never rent a property again. This pandemic has shown me exactly who is disposable. No governor will again decide that my tenants don't need to honor their payment agreements.
May landlords vanish; I am no longer among their number.
https://en.wikipedia.org/wiki/CARES_Act#Foreclosure_and_evic...
followed by a rant about the indignity of the poors having access to legal representation (?!?!). And an appeal to mom-and-pop immigrants to provide smoke cover for commercial real estate developers and the local landed gentry.
This is where "eat the rich" comes from. I'll take my flag-dead for this one.
Everyone that has a dispute with a landlord is a grifter and con artist? That's a strawperson to beat all strawpeople.
> When I worked in commercial real estate
Is that the attitude toward renters in your industry?
Why would landlords be expected to be any more honest? IME, everyone who has had a legal dispute with a landlord has been an honest person with an honest claim (though not always legally supported), and landlords have had enormous power over them. I have no doubt there are some bad people in both camps.
If the court finds in favor of the tenant, that means the landlord screwed up (and probably broke the law, too).
Market stabilization against short term shocks (i.e. temporary rent subsidy) functions like unemployment insurance, stabilizing the entire market and not increasing homelessness.
The effect of a tax increase is more distributed so that it is less likely to be directly passed on to consumers.
Increasing taxes shifts the burden more indirectly so it is less likely to be directly passed on to consumers.
With rent assistance the landlords continue to receive rent, so it may be easier for them to absorb the costs.
Since people receiving rent assistance can keep receiving the assistance if they move to a better deal, competition between landlords is still in place.
I saw a video of one guy threatening hotel staff who the cops would not forcibly remove and the courts are not requiring it because it was not deemed threatening enough. He is still in the room months after the incident, not paying, with the individual hotel owners and staff eating the cost.
If you impose a tax on buildings, that gets shifted onto tenants. If its a tax on land (ie, the rental value of the location), the landlord has to eat it and it gets fully capitalized into the price, which means the landlord can't pass that on to the tenants and it actually brings the price of the land and rents down. There's a long string of empirical studies that back up this finding, the latest being this one out of Denmark:
https://www.zbw.eu/econis-archiv/bitstream/11159/1082/1/arbe...
I'm not quite sure I understand the difference here, but I may be misunderstanding why a tax on the buildings and a tax on the land is different? Are you saying a tax based on rental prices? Otherwise I would assume any cost to the landlord would eventually get passed on to the tenet, being the source of revenue.
The landlord has to pay the tax whether they're renting it out or not, but what kind of tax you're assessing affects how much they can charge in rent to their tenant.
When you tax something, the cost typically gets "passed on" because you are changing the marginal profitability of that thing, and this causes the supply to decrease, which drives up the price.
We can make more buildings. But we can't make more land (locations).
So theory has long held that a tax on the value of land (also known as a site value tax) cannot be passed on to tenants, because it's not like someone says "well the cost of holding land went up this week Charlie, better make slightly less land this quarter." Though they can and absolutely do in fact do that with regards to, say, housing construction (and gasoline, and cigarettes, and sirloin steaks, and plush dolls, and anything else you might want to tax).
And this is exactly the empirical effect that the referenced research paper (and many more like it) find in practice. If you assign a split-rate property tax which taxes two things: land, and improvements (buildings, essentially) at different rates, and you have a natural experiment where you randomly vary the tax rate on the improvements and the tax rate on the land, you will find that the price of the property goes down proportionately to the tax rate on land (full capitalization of land taxes), but that doesn't happen with the portion of the tax rate that falls on buildings.
See this for more on the underlying theory: https://astralcodexten.substack.com/p/your-book-review-progr...
If you want more sources on the empirical findings I'm happy to provide that to.
> If they can't make a profit at that rate then they'll eventually sell the property, or develop it for a more profitable use.
This is exactly the political purpose of land value taxes, by the way! Under a sufficiently high land value tax, the only way to make land more profitable is to IMPROVE it by building useful stuff on it. So if the improvements go untaxed (you don't get penalized for building stuff), but the location is taxed, you incentivize people to build stuff lots of people need, such as dense housing rather than parking lots and single family homes.
Only because the substitution good to rent is purchase which would also be subject to the same taxation.
The only reason rent and property value are correlated is that they are substitution goods, but the linkage is not fixed. Simple examples would be say student towns, not every student is going to be able to chose between rent and purchae etc.
In the case of a moratorium, the landlord takes an immediate, complete, revenue hit. In the case of tax increases, the landlord pays something extra, spread out over both time and the taxed population.
It's like the difference between not getting a paycheck and having your rent go up.
Secondly, how much landlords pay in tax is less relevant than what incentives the policy sets up. On the part of landlords, eviction moratoria incentivise not renting to higher-risk tenants at all. Higher taxes + rent subsidy would have the opposite effect, with more reason to rent to high risk tenants, and renting out properties that might be marginal otherwise.
I don't know all the details of this, obviously, but this sort of policy analysis is much more about how it shifts incentives on the margin, rather than who pays more and who pays less.
Shifting the burden to the landlord, especially at a time of transient shock, is not only a direct tax, it's a tax when they may be themselves suffering a revenue shock just as their tenants are. Even replacing a tenant isn't automatic; there are transient costs and it can take time. While subsidizing the tenants takes cash from a large base (including debt, borrowed at a much lower rate than a landlord can get). That's the surface difference.
But you may ask "who cares? Why do the landlords a favor?" Well there's a systemic issue in such a shock (think of swimming in the ocean when a wave drops you then lifts you independent of your swimming). Keeping the tenants in situ means the landlords can continue economic activity (doing repairs, buying lunch, going on vacation, etc). The tenants can too -- if nothing else they can look for a job rather than looking for a job AND looking for a place to live. Or they may not have actually lost their job, but just suffered from transient reduced demand (e.g. fewer haircuts) which might end up being complete job loss if they lose housing. Essentially you are preventing a liquidity crisis.
And there are second order consequences as well: as the paper shows homelessness increases; this is a general tax on everyone not just in social programs but in all the followon consequences of having a lot of people on the streets.
It's the same argument for subsidising farmers, even if most of them these days are big businesses: they suffer a lot of transient economic pressure (busts and booms) but we need a reliable food supply. So we engage in dreadfully wasteful behavior because we've decided it's better to pay that than suffer a food supply shock.
Taking someones profits to zero means they 'break even' on their expenses. Taking someones revenue to zero means they have to pay all their costs out of their own pocket.
How is firing someone different from them going up a tax bracket?
The point is to limit the risk for landlords. Maybe they will earn less on good tenants, because of taxes, but they won't hesitate as much before taking "not as good" tenants.
https://www.usatoday.com/story/news/politics/2021/08/25/89-f...
Reminds me of Wimbledon. Oddly reported as a "windfall" but no doubt they were called "stupid" for spending $2mil a year on pandemic insurance.
It has learnt from the SARS outbreak, taking out pandemic insurance since 2003
https://www.insurancetimes.co.uk/news/wimbledon-set-for-coro...
If there would be eviction moratorium, I will think twice before renting out and will only ever consider wealthy tenants and exclude anybody who may have any problems in the future. If there were anything like Paris laws where the tenant may refuse to evict at all, I will just take the property off market.
This is basic game theory. The only reason why there's supply is because it comes no strings attached.
Right now the only requirement for me is that you need a security deposit. That'll get adjusted to credit checks, criminal checks, and leases that allow me to void them over basically anything I can get away with per the law.
Others, I fear, won't work within the law and start screening on perceptions, stereotypes, and personal history with individuals that get projected onto groups.
In short, the quicker it is to evict someone for failure to pay, the less protections a landlord needs to use or worse, invent, to protect their livelihood.
And do what with it? Pay taxes for it to be empty? Sell it (thus providing exactly the same unit of living space to the market)?
At the very minimum I could never consider any vulnerable people as tenants. And this is a red light for any housing policy, really!
This decision isn't made though vague horror stories, there are people I know who've had tenants do thousands of dollars worth of damage before they're forcibly evicted. It's not worth the risk.
I'm not sure if it's everywhere, but in some states you legally cannot do this if you still owe a mortgage. The mortgage requires home owners insurance, and the insurance companies won't sell you home owners insurance on an empty house. We were forced to rent our house when we needed to move (during the slump, so no buyers) due to this.
This is only true if being a landlord is your "day job."
The risk of a tenant trashing your property is the entire value of the home.
I know a few folks that are apprehensive of the markets just cashed out, took a mortgage and bought a condo to rent. Especially if they bought a couple of condos I can't imagine they'd otherwise have the income or reserve to pay out-of-pocket when their tenants refuse to. I'm as liberal as they get but this kind of thing feels like over-stepping from the government; I agree tenants need to be helped, but not by moving the hardship upstream in the economy - maybe the government should pay their rent instead. Dunno, feels very strange.
So what.
They bought a spare house and wanted to farm people for what they felt was a safe 8% while doing minimal work themselves. The situation changed. Life sucks doesn't it.
We don't bail market investors out in a market crash and at least they're (outside of REITs, and you can guess my views on those) not speculating on the essentials of literally living.
Why should we offer landlords a bung off the back of hard-working taxpayers who are, a large minority, already handing over vast amounts of their take-home to landlords anyway.
Worst comes to the worst they foreclose on their spare home and the bank who took a stupid risk lending eat the loss from the tenant.
Every annual company statement contains a risks section which usually includes the unforeseens such as changes to legislation. That's what's happened here, why should rent seekers get kid gloves?
Imagine you wanted to sell your Facebook stock once it starts crashing (to buy another stock that maybe performs better) but the government says no you can't because Facebook employees will be affected so not only are you obligated to hold the stock, but you'll also need to pay out of pocket to keep it.
Just to be clear, I have no sympathy for the slumlords and rental corporations, I'm talking about regular folks that chose the rental market as more risk-adverse investors and maybe put all their savings into a single property that they fixed up and are maintaining themselves.
I think more risk-averse people would avoid a single property as their entire investment portfolio.
Everyone says "diversify" your investments. if you are more-risk averse, you should not be putting all your money into 1 bet or 1 property.
And asking landlords not to throw people on the street at no additional cost (let's say they do evict, who is going to be doing viewings at the height of the pandemic?) to them is a very low impact ask.
Edit: I think the root cause disagreement is how we categorise housing, as an essential or an investment. I can see why you'd be squeamish about such heavy-handed intervention with investments but my view is that's a category error. This is like wartime rationing, people need to eat and they need to live.
Agree that for most home-owners, it'd be a mistake to regard their own home they live in as an investment. FWIW, I have no dog in this race, I'm neither a landlord nor a tenant (I -and my mortgage provider- own the home I'm living it).
> Just to be clear, I have no sympathy for the slumlords and rental corporations, I'm talking about regular folks that chose the rental market as more risk-adverse investors and maybe put all their savings into a single property that they fixed up and are maintaining themselves.
A core problem is that so many of us have never met one of these people. 100% of my landlords have either been large corporations or slumlords. So when people say "think of the small landlord trying to be nice" we wonder where that person is.
Back when I rented, the corporate apartments were the worst experience since there was zero flexibility to anything, all was managed with zero tolerance based on the company playbook.
Renting from individual owners was a delight though since I was dealing with an actual human. Very flexible about everything, always open to discuss options.
But at least they repair stuff. Whenever I had a system break my corporate landlords sent somebody over that day without question. With individuals I’ve had to pull teeth to get even critical maintenance done.