Whitby residents vote in favour of ending second home ownership
news.sky.com
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Between second homes (and third, fourth and fifth homes), AirBnB/VRBO/etc, the ultra-wealthy parking money in real estate, real estate markets catering to the ultra-wealthy by mostly or entirely building properties for the ultra-wealthy, rampant NIMBYism, institutional buying of residential housing and protecting property values becoming a political goal we have a complete mess on our hands.
Let's start with this:
1. PUnitiviely taxing any property held by a non-individual as an owner. I'm talking at least 10% of the property's value every year;
2. Banning AirBnB in any case where the owner isn't living on the property;
3. Treating all owners as residents in that city, state and country for tax purposes and taxing their worldwide income accordingly. Let New York be for New Yorkers;
4. Ending tax abatements for ultra-wealthy property development;
5. Properties above 200% of the median value should also be taxed at a much higher rate;
6. Property that isn't occupied the majority of the year should also be taxed punitively.
In fact investing stimulates new construction, having the exact opposite effect.
But this isn’t practically true in most major metropolitan areas. When one makes an investment as large as a home, one of the best ways to protect that investment is to block further construction (reducing supply and therefore raising demand on your investment)
Except those with the money to make investments in real-estate are the very same people who have enough money to make the political system work for them.
"Just make that shit illegal" is simply a refusal to understand how complex these incentives are. If it was so simple to just make that shit illegal it would have been done already; we are nearly decade in to the housing crisis in cities like San Francisco and you think people haven't thought about making it illegal? How do you go about doing that? Eventually you will be forced to consider solutions that the GP was referring to.
reason 1: In fact its not investors who block new building, its single home owners who want to 'maintain' their neighborhood.
reason 2: CA has passed a number of resolutions allowing for ADUs, splitting of lots etc. However the city is glacial and beyond opaque in its approval, closing out smaller fish who would try to build things by miring them in requirements that are difficult to meet without a corporate set-up
I say "propaganda" because that's the idea: that market forces will solve the problem. But in reality it's easy to get to a state where a single or small number of market participants effectively corner the market or become so politically powerful that any government works at their behest. This includes blocking new construction to protect and appreciate the value of existing holdings.
Just look at how much in the last 6-12 months you've seen stories that go "20 offers on this house and it went $200k over ask all cash".
The effect of all this is that it's driving rents through the roof, that is adversely affecting the most vulnerable.
[1]: https://localprofile.com/2022/06/07/investors-bought-texas-h...
2. People/Companies refuse contracts based on their principals
3. Other People/Companies take up those contracts
4. Those Companies post job openings to build said houses
5. People take said jobs, they can refuse if they don't want to work for a company working for the Govt.
6. Houses get built
Sounds like regular capitalism to me, no one is being forced to do something they don't want.
If the government are building the houses surely that's the will of the people?
However, you can argue this for just about anything the government does with tax money. It's not wrong per se on an item by item basis of government function. Although, ideally government functions benefit everyone in some regard so in practice its not as bleak sounding. Very few people would be hard pressed to receive zero in return from all functions and programs of a government that is not abusive. Although, unless you get one these houses your not getting anything in return here for this hypothetical 5%, again though that is on an item by item basis. There could be tertiary benefits that one gets, but are hard to quantify with a dollar amount if such a program is working well. Such as a more stable community, ect...
That seems unlikely.
This is pretty much the principle behind distributive and legal justice, expressed crudely. I have no prima facie problem with the idea of a program which is constructed to recognize that everyone is owed shelter, and if it takes declaring that as a "human right" (whatever that might mean) then so be it.
Your father could've quit, changed careers, moved to another state, etc.
Slaves don't get to do that.
[1]: https://www.law.cornell.edu/uscode/text/18/3006A [2]: https://law.justia.com/cases/new-jersey/supreme-court/1992/1...
How about the police force that protects your exclusive access to land (a natural resource)?
Great, except this means less than you think. Negative right (e.g. "freedom from X") free speech means that it's 100% legal for Comcast, Facebook, Twitter, Reddit, various Mastodon instances[0], that weird Trump-only social network, and whatever other platforms are out there to censor you because they're "not the government" and are merely refusing to publish something rather than banning it with the force of law. Free speech online is entirely a positive right (e.g. "freedom to have X"), because it all relies on private actors cooperating to publish your speech. In a negative-freedom world, the Internet is a censorship hellscape.
Positive freedom to speak would be something like net neutrality - i.e. common carrier rules. Nobody is obligated to provide Internet services, but if they do, they can't arbitrarily refuse service to certain people based purely on the user's speech. Right to shelter could work in a similar fashion - i.e. you don't have to build housing, but if you do, a certain percentage of it needs to be cheap housing. Or, instead of just mandating housing just exist, we just have the government spend a certain amount of tax outlays - that we already collect - on new home construction on the open market. We don't compel the workers to build housing with a gun, we compel them with money, which is a kind of compulsion that even the most free-market capitalist society readily accepts as legitimate.
Conversely, there are also negative-right conceptions of "housing as a human right", too. It could mean, for example, that zoning laws are unconstitutional. Right now there are plenty of government interventions in the housing market that are there to specifically prohibit certain kinds of housing arrangements - usually multi-family units - in certain areas. These arrangements impinge upon the market's ability to actually supply increased demand, and thus drive up the price of housing and price poorer people out of the market. Even if you entirely deny the existence of positive rights, think taxation is theft, and think Murray Rothbard had some good ideas... how is that not a violation of human rights?
[0] Mastodon is federated, but in practice most people use a large instance if they want to be on the Fediverse. It is possible for instance owners to refuse to federate with one another or block specific users from other instances.
We can see that housing is a right in the same way that freedom from unreasonable search is a right: it is a limit on what the government can do to you. If shelter is a basic right, that means the government cannot force you to be homeless.
A government assumes an obligation to provide housing for its citizens by interfering with their natural ability to provide it for themselves. It is the government which defines the idea of private land ownership, the government which hires police to enforce property boundaries, the government which imposes property taxes, the government which regulates use of public land, the government which enacts zoning codes, the government which requires building permits.
If someone cannot make it through this gauntlet, we cannot demand that they simply lay down and die: government created the problem, so government must solve it. Accepting the existence of shantytowns is one solution; subsidized public housing is another.
First, your rights end where mine begin. Even free speech doesn't mean you get to shout "bomb!" in a crowded theater without consequences. Likewise, your "right" to say something also doesn't mean I have to hear it.
Anything beyond what you think will at some point infringe the rights of others so there are natural limits.
Second, no "right" is absolute. If happen to believe in the current Supreme Court's interpretation of the Second Amendment (namely that it's an individual right, which, to be clear, I don't) then even that has limits. There are limits on what weapons you can own, you have to be 18+ and you (generally) can't be a felon. There are limits on where you take such firearms (eg try to take a firearm onto a plane).
If you can't come up with a down payment, then you have to rent. Because you have this captive group of people who don't have any other option, the result of what you're suggesting is that your 10% tax on non-individually owned property will just be passed along to renters. They'll have to pay it, because they have no other choice. The government will collect their tax money, but at the expense of the least advantaged, not the owners of investment properties.
I can't really respond to your proposal of rent control, because it has no detail on how that would work (How would a newly build apartment building come up with rents that factor in their costs but not the 10% tax? Does any newly built apartment building just have to lose money every month?).
But anyway, rent control is bad because it constrains supply of available units. That's been discussed on HN more times than I can count, so no point in rehashing it here.
In a normal market, when demand goes up supply usually follows. If a lot of people are buying Widget A, pushing the price up, more factories will pop up to manufacture Widget A, bringing the price down again.
But housing is a zero-sum game - the amount of land is finite, the amount the authorities let you build on is even more limited, so the market can't fix itself, it's not a normal market. That's why you do need some kind of intervention to protect the participants. This is all apart from the fact that it's a basic human need.
But medical and housing? Yeah, it has no problem destroying peoples lives.
You can't start a company that says "let's increase the supply of housing because demand is high." You can do that with most other markets.
What I think you're saying is it ought to not be zero-sum because there's enough land - perhaps. I was talking about the ability of market participants to increase supply.
To be clear, I'm not against landlords existing. My guiding principle is that landlords need to exist because forcing people to own property isn't practical or even desirable. There is significant friction with buying and selling houses even if you can get over the financial barriers (eg downpayments).
The simplest way I can put it is that I believe in this guiding principle: Landlords should be part of their community.
What does this mean? Some examples:
1. I'm all for multifamily housing where the owners have 1-2 rental units on their property. This style of housing exists in small pockets of the US as generally a legacy but is now outlawed almost everywhere (most of the US makes anything other than single family housing illegal to build).
2. In the case where the landlord doesn't live on the property they should (IMHO) generally live in the same locale. This is what I mean when I said "New York should be for New Yorkers". Perhaps a better way to say that is "New York should be by and for New Yorkers". Obviously you can substitute any city name there. NYC is just an example; and
3. When it comes to apartments, generally I favour purpose-built rental apartments being built for this rather than renting out condos. Again though local ownership is better.
What is the basis for this conclusion? Other than an emotionally charged "eat the rich" attitude, I mean.
Lolz.
If "made up" is disqualifying, I've got bad news for you about all rights.
No one gives you rights; certainly they're not granted by a piece of paper. Rights are what you can guarantee and defend yourself and with fellow citizens, through political will or brute force. Everything else is meaningless virtue signaling.
The problem as I see it is government regulation. There was a thread on Reddit from a LA property developer that explained why only luxury apartment buildings ever get built. Long story short is there was so much red tape, regulation, etc that building anything but expensive high rise units was unprofitable. I heard somewhere that for the average home in California, you're paying something like a 50-80k premium because of red tape and regulations.
The solution isn't to add more rules and regulations, but rather to take them away. The way we are going to get more affordable housing isn't through a program where 10% of a high rise's units are "affordable", but by actually making affordable housing profitable. If a developer can build an "affordable" property and make money on it, we will see more of them.
> The results of the vote, which saw just under a 23% turnout, do not carry any legal weight
Wait, all they did was conduct an official opinion poll?
similar to HOAs in the US
(though they have no power to add them to existing properties)
There will always be loopholes and attempts to find them, but that shouldn't necessarily be a deterrent to taking action.
About 70% of my investment income comes through indirect and direct ownership of residential and commercial property. It's just too easy for the wealthy to come in and buy up properties to price others out.
Pay no attention to all those failed states that have already tried this - this time will be different!
Further, your argument doesn’t hold water - food is a requirement, but does it have to be grass fed beef? Could I not make do with soylent green?
This way of thinking is a race to the bottom. It must be avoided at all costs.
What if I own a family farm and want to build a new modern house on some of the property? Do I need to demolish the old one, sell it, be homeless to build a new one?
IMO: the real problem is that it's very hard for individuals to get loans for construction easily (and the ones you can get are extremely risky because the rates can change on you.)
Are there some ideals at work here, or is it a case of people not fully grasping the future consequences of their current actions?
This is a false framing. There are real future consequences to having a community of vacationers - seasonal only restaurants, emptier schools and playgrounds, lack of trust, businesses that can't sustain themselves because the population only occasionally drops by, split voting with opposite interests re: long-term investment.
Your home is where you live, not just an investment vehicle.
It's not an either-or proposition, it can be both at the same time. The issues you mention are real, but would the town be better off with a seasonal restaurant or with no restaurant at all?
I'm no expert in British law, but what would happen if I want to buy a house there and get rejected because I already own one, and then I take them to the court?
They are presumably thinking of their children (who these days can only buy a house with the help of the Bank of Mum and Dad), and the wider community. And themselves too, should they need to upsize. It's not as simple as value up = good, value down = bad.
They might like to sell it (and buy another one) if they want a bigger house (e.g. when they have more kids), or a smaller house (e.g. when the kids have left the nest). Selling their house and buying another one in a more open market (not having such limits on buyers) would mean finding the money to pay for a difference between the lower prices on the limited market and higher prices on unlimited markets.
But more importantly, it saves the local economy.
The problem is that if your town is full of holiday rentals with people who only turn up for 2 weeks in the summer it's impossible to run a local business, because there are no customers for the other 50 weeks of the year. So essentially you end up with ghost towns where the economy is dead for 50 weeks of the year, locals can't afford to live there anymore.
> it's impossible to run a local business
Point taken, but is there anything in the British law that guarantees one a right to run a profitable local business?
> you end up with ghost towns
I agree with your assessment that it's what this (free) housing market is creating. I think it's by design though? If your argument is that this is somehow a market failure necessitating government intervention, you need to prove why the alternative situation is better for everyone, not just the locals.
A case in point - recently one MP came out and said he didn't have confidence in Boris Johnson. Hilariously in retaliation the government announced they were green lighting a fracking site in his constituency. (this isn't very relevant, but it is very funny and demonstrates the limits local councils have)
Seeing this was just an official opinion poll, though, it's mostly irrelevant.
I am certain, for example, that if the planning application would include a clause banning e.g. blacks, LGBT, or non-Anglicans from buying a property, this would be shot down later, even if approved.
The question is, whether limiting current homeowners from buying a property would stand up to the courts' scrutiny or not.
House prices going down is a GOOD thing for the vast majority of the population.
What you also forget is that as a coastal property people buy those houses as holiday homes. So by not living there for 48 weeks off the year, local businesses suffer. By ensuring those homes are lived in means local businesses will flourish.
I'm not going to answer the ad-hominem attack, you know nothing of my situation, and it's irrelevant to the discussion anyway. But I think it's stupid to own a property which brings no revenue and stands empty 95% of the year, but still requires taxes and upkeep.
> House prices going down is a GOOD thing for the vast majority of the population.
On the opposite. House prices going down is a good thing for the unhoused population, and it's a bad thing for the homeowners. In the most markets, more people own houses than not. So the majority of the population usually enjoys house prices rising (at the expense of the minority, of course).
Additionally, the more a house is "worth" on paper, the more people are willing to invest in it (renovations, keep-up), which is usually a good thing for the economy.
> What you also forget is that as a coastal property people buy those houses as holiday homes.
I don't forget that, I completely understand the situation. What I don't know is the situation in a neighbouring town which is not coastal and where no rich londoners are buying.
That minority is slowly becoming a majority. Home ownership in NZ is the lowest ever. It’s down to like 60-65%. The market is becoming completely unaffordable.
Raising prices is good for high income earners and people who have homes to leverage from.
> Additionally, the more a house is "worth" on paper, the more people are willing to invest in it (renovations, keep-up), which is usually a good thing for the economy.
People who can barely afford a house cannot renovated it. When a mortgage payment is 2-3 times the cost of renting you don’t have disposable income to renovate.
> House prices going down is a good thing for the unhoused population, and it's a bad thing for the homeowners.
The ONLY time prices falling is bad for a home owner is when the value of the house is less than what they paid.
If I read it right, the homeowners outnumber the non-homeowners 2:1 then? This would mean twice as much votes for measures getting prices up than against these measures.
> The ONLY time prices falling is bad for a home owner is when the value of the house is less than what they paid.
I disagree, not on the question "are prices going up good?" but on the question "do most people like the prices going up?". I think most people who own property want to see their property go up, not down, in price; and I think the majority of the population owns property, and so falls into that group. In other words, I think that on a referendum of whether to get all property up by 50% or down by 30% the people would act in their own self-interest, and the "up" would win.
If you could magically track down every person who would in the future purchase a new-build home in Whitby, and did a vote of those people, then they would presumably be massively against having their home under a restrictive covenant forcing someone to live there the whole time.
> every person who would in the future purchase
does not exist yet.
Obviously everyone on the beach doesn't want the beach to get crowded, so they'll say no..
But the democratic approach is to also ask those who were planning on arriving at the beach later, even though they haven't arrived yet.
But if you insist, this is more like folks wanting to make sure there is enough beach for everyone and that everyone can use it - so they make limits on the portions of beach that people can own.
Citizenship provides for voting rights while away for some countries. Eg in UK you can vote for up to 15 years after leaving the country. In NZ you can vote up to 3 years after you last visited. In Australia it’s 6 years.
It makes sense to me (maybe not for 15 years but 3-6 ok). As a citizen who will return home eventually, it makes sense to look out for the country by helping pick its stewardship.
https://www.gov.uk/voting-when-abroad https://vote.nz/voting/how-to-vote/vote-from-overseas/ https://www.aec.gov.au/overseas/enrolment.htm
Quoted: ...track down every person who would in the future purchase a new-build home in Whitby, and did a vote of those people...
Humans are owed /nothing/ not a single solitary thing. We /strive/ for things, such as equality, and freedom of speech.
Placing blame on X for Y's suffering is a straw-man argument, with straw-man solutions that fail spectacularly when trials are performed.
Basic income? Yup 3 countries tried it, and ditched it immediately.
Basic housing? Yup countries, counties, and states have tried this, and it failed miserably.
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Morality, which is what the 'everyone deserves a house' mentality is, cannot be legislated; ever.
Change comes by doing, not by forcing others to do for you. This world needs a giant enema.
Basically, it seems to be a great scheme for resident to have a new home built at little cost by reselling their existing older home at an increased value.
Look at the Swiss Federal Act on Second Homes at https://www.fedlex.admin.ch/eli/cc/2015/886/en to see a proper legislation to that effect. It prevent alteration of usage of existing homes in communes with second homes in excess of 20%.
The measure as described will:
- lower the demand and price for buildable terrain
- increase demand and price for existing homes
Both are financially favourable to existing homeowner residents but not to first time buyer who will still have to compete with investors on the older homes market.
I'm either misunderstanding your claim, or it doesn't make superficial sense.
If every home must be a primary residence, you have reduced demand because investors (who are often able to spend more than a resident/owner) can't buy there.
Talk to anyone who has tried to buy a house in a developed country in the last 5 years. They were very likely competing with cash offers from investors, often at an insane (I would say speculative) premium.
I have observed this locally while looking at condos and vacation homes, but it also makes theoretical sense and is supported by data:
https://www.sandiego.edu/business/documents/centers-and-inst...
Just to be clear, I don't. I'm a homeowner whose home value would be hurt by measures like these, but I support them anyway. I think it would be hard to pull off, but the country would be better off if landlordship/non-primary homes were heavily taxed or banned altogether.
In that vein, I see Airbnb as a cancer on society that is among the most evil and harmful companies that no one realizes is having the effect that it's having.
Bernie Sanders should be asked for his opinion on the matter.