The broader problem is lack of housing that can be afforded by the non-wealthy, which is caused in significant part by zoning laws. If more housing was available, the increased supply would better match the demand.
Corporations can buy up all they want… but idle units are unprofitable. Between property taxes, borrowing costs and maintenance (which accrues whether units are empty or not), units need revenue or they are a drag on profits. Cartels fall apart very rapidly under these conditions.
Right now demand outstrips supply by a wide margin. This makes it profitable to buy and rent it out. Build enough housing to put some slack in the market and that equation will rapidly reverse.
TL;DR corporate ownership is a symptom, not a cause of housing supply issues.
https://www.houstonpublicmedia.org/articles/housing/2023/07/...
It is a universal law of economics that people pretend doesn't apply to housing.
In these towns, do you have evidence demand is stable and yet prices rise?
https://scott-wiener.medium.com/yes-supply-demand-apply-to-h...
None of what you said contradicts that. Supply is always measured relative to demand.
And I'm saying supply and demand can get out of whack for reasons that have nothing to do with the government, they can even get misaligned under pro-growth policies.
The challenge is houses are the product of both capital and labor, so even if real capital returns are negative, you get stuck with high prices for construction.
You see much higher wages in sectors where demand for workers outstrips supply. AI architects and neurosurgeons don't need labor organization to capture high salaries.
By exactly your logic, technology has always increasingly displaced demand for labor. This isn't new at all. So-called "reskilling" is always outsourced to the responsibility of labor. The professions you describe are regulated into scarcity on an ongoing basis by capital. Any exception to this rule is simply that. In the aggregate, capital accumulates.
For surgeons, yes. The American medial industry is uniquely exploitative so invests a tremendous amount of capital in backing up its claims of prividing the "best" medical care (only for wealthy people). Of course, the American Medical Association and American Association of Physicians play their parts in contributing to the scarcity by lobbying for extremely expensive education requirements that can only be afforded by those with inherited wealth (with a few exceptions only via charity).
Just as the feudalist aristocracies, the capitalist bourgeoise pull up the ladders behind them. It only works when capital has an incentive. In the case of a few American industries like medical, those incentives are especially strong. However, such incentives do not exist in almost any other country, and salaries reflect this.
I the AMA and AAP driving up is labor driving up costs in its own interest. Same as any other workers association or union working to restrict supply. Capitalists (e.g. hospital owners), have an incentive for lower salaries.
Similarly, its not the owners of salons that pushes things like 1,000 hours of training required for a barber.
Just because it is anti-consumer, doesn't make the person behind it a capitalist. My fundamental point however is independent of the reason for scarcity, but that labor scarcity itself is what drive high salary for those roles, and an oversupply of qualified workers drive down supply in other roles.
I'm sure the idea is abhorrent to the USA, but perhaps removing incentives to be a landlord at every step should be considered... mortgages should be punitive on second properties, taxes exorbitant for rented properties, insurance should be unavailable, etc. Housing should experience disintermediation, those in the housing should be the ones owning the housing.
On this site my karma will suffer for saying this out loud, but a persons fundamental right to shelter, food, health... are just not valued in the US above someone else's right to profit from depriving some of shelter, food and health... at every level it's wrong, but yet capitalism seems to demand it.
You can't have a right to housing without taking away the right to property.
Renters are a Group that are already unprofitable to lend to, so banks would reject most and hike rates higher for the rest.
Your proposal only makes sense if landlords provide no service, but this isnt true. Just like how a bank makes a % interest for taking risk and providing capital that owners wont, landlords do the same thing. Landlords get paid a profit to take on risk and long term liability (to the bank), and again provide capital.
In short, banks loan cash to landlords because they are more credit worthy and take on liability. They in tern loan a home to renters, who have worse credit and much less liability.
It is all about paying a premium for others to take financial risk.
Maintenance is largely ancillary.
Im a landlord. Maintenance is only like 2hrs of my labor per month. However, the unit purchase represents about 10,000 hours of my labor. The renter gets to pay maybe 40 hours of worth of labor per month.
If someone has a job but no assets, how do you expect someone to pay builders and materials? If they could, they would be an owner, not a renter. If they were credit worthy, they would be an owner, not a renter.
Renting is effectively a short term loan for the value of the house.
Try getting a 12 month loan for $1M without collateral, and see what the interest rates are.
The problem we're seeing in the housing "market" today isn't that people with no job or assets can afford a home, the problem is that prices have been inflated under speculation so much that we've passed the point where even a median earner can't afford a home.
My hcol house cost. $1.5M. The labor and materials to replace the structure are assessed at $1M,leaving 500k for the land. There are no empty lots around so I'm inclined to think that land in the bay area is worth that. I know I paid 500k to live closer to my job.
In fact, in my most recent home with 12 zones of sprinklers built with zinc piping 30y ago, I had to personally replace half of the valves and a whole manifold so that I wouldn't have to choose between losing my deposit for the yard dying, or paying $1000/month to run the worn out system. I've had issues with every property I've rented, and every single landlord I had any beef with was more than willing to strongarm me using the lopsided law rather than manage their own properties.
Another story. I was a newlywed and went to sign a 6 month lease. 5 months pass and we want to leave, give them notice, and move out at the end of the month. Well, the teenager running the leasing office counted wrong and wrote it for 7, and when we went to turn the key in they told us we owed $1200. Sure, I didn't catch the error either, but they said nothing at notification and were unwilling to split the difference. They sent it to collections and just had the gov take it right from my bank account.
Or how about my rental before my first story, where they sent a sprinkler guy to "fix" the sprinklers, he checked out the issues I raised and said he was going to get parts. He never returned. Later that week I noticed that the lawn was terribly dry, I check the timer and turns out the landlord just asked the guy to surreptitiously unplug the controller so they didn't have to pay for the water.
And that's not even getting into the economic impact of usury on housing, and how every day its taking away the dream of owning a little something of their own from people that arguably put more labor towards keeping our society healthy than probably any of the data shuffling nerds on this site.
But hey, if you think it's great that people can't afford a home I guess you can consider it something different.
You're welcome, bye.
What part do you think worked out well?
If private parties have no incentives or possibilities to build, you're left with government housing, and governments are prone to overpaying and underdelivering.
The only way to ensure a right to food and shelter is by ensuring that there's enough food and shelter to be had in the first place, something which we've seen socialist systems struggle with.
The only way is to build, build, build, and when the population density demands it, build tall and build small. Apartment complexes with 5-20 floors are a far better and far cheaper idea than sprawling suburbs.
https://www.statista.com/statistics/246355/home-ownership-ra...
Come nineties, oughts and today and the huge majority of housing units made are for tourism and speculation and are just empty most of the year. Landlords appeared too, some of those accumulating wealth from renting/Airbnb'ing their previously built summer houses, a lot came from money laundering/extraction. Housing itself has very little if any taxation so it became a wealth store and its just a big circle of socially bad incentives. Usually when there is a big political arrest it would turn our that the person had like 20 houses/flats/boutique hotels. Nothing usually comes out of it, but thats a different problem.
In the last 20 years the young people got totally screwed by lack of housing and many people emigrated unable to afford even to rent a flat and have some leftover money. Or to put it in the scale, more people emigrated than at any point in the last 150 years. People don't emigrate if they're fine with what they have. And politicians care even less because people who emigrated won't vote in the elections. And did I mention that most of them are landlords too?
My point is, a political system be it "communism" (quoting you), "socialism", "democracy" or whatever has very little with how they deal with the problem. The reality is usually much more complex than applying easy labels.
It was not caused by lack of will to build houses, but lack of construction capacity. Over time, the problem lessened and ultimately by late 70s it was almost unheard of to find a homeless person in a city. Even people with serious problems like alcoholism were housed almost always.
Unfortunately this resulted in lots of gray cheap blocks of flats. Looks drab. Over time also got improved.
Homeless people are around again and number is on the rise, shortage is around again. Very expensive "apartments" that are tinier and worse made than communist housing are sold for barely attainable sums now. They just look better on the outside.
The problem is what will happen is that any US regulations around this will end up targetting middle-class “landlords” who rent out an extra home. And the real issue of huge corporate real estate holdings will be just fine.
It’ll scratch the itch of people wanting to beat down someone in their neighborhood, "boomers", etc who rents out something due to petty envy, but unlikely to solve the issue meaningfully.
A lot of average people buy real estate because it’s one of the few inflation hedges left for them.
Same argument for food, basic clothing, healthcare, education, transportation, etc. right? There is an argument to be made for communism, but it's not got a great-looking track record.