No one gets a second home until everyone has their first.
Rental has its place, there have been plenty of occasions in my life where rental suited me better than ownership. Regulation and enforcement of said regulations would do a lot to protect people in this situation.
Dude from Ukraine was telling me that most people own condos. He was weirded out that the vast majority of people in the US don’t have a vested interest into their neighborhood simply because they believe they won’t live there for long.
Did he mention that a lot of the real estate that people own in most post-Soviet countries is inherited when (grand)parents die, this being first if not the only step towards the market for most people?
None of the people I know from Russia, Kazakhstan, Ukraine and Belarus bought their first apartments on their own through hard work or anything: it’s mostly apartments where your grandma died, apartments that you’re either massively helped with or outright gifted by parents when yuu have a significant other to move in with (so both families join funds, most coming from selling some dead relative’s apartment) or on a wedding day (a rarer occasion), or some mix of that.
Without any help or gifts, you’re lucky to be able to get a mortgage that you can pay off before you’re 60 (at least).
The real estate prices outside the US and the EU may seem nicer, but salaries and expenses sure don’t.
Everybody is screwed, everywhere.
Rental property should be publicly owned. Landlords shouldn’t be a thing.
I can see there being exceptions if you say own a property but have to move swiftly elsewhere and can’t/don’t wish to sell it, in such a case letting it out makes sense.
No, no exceptions. Once there are exceptions people will abuse them. Even if you inherited your parents property if you already have one you should have to pay extra taxes on it from the day they die until the day you sell it, period. Any person, family, business, or corporation should only own one property, zero exceptions.
Edit: /S. Thought that was obvious
Even if you inherited your parents property if you already have one you should have to pay extra taxes on it from the day they die until the day you sell it, period.
This seems needlessly callous to me. At least give them a 6-12 month period to clean up, do repairs, and sell the house. Not everyone that inherits a house is making enough to pay increased taxes right out the gate like you’re proposing. Also, from personal experience, cleaning houses of deceased relatives tend to require a bit of work to get ready for selling and is incredibly emotionally draining. What you’re proposing is going to be extremely painful for the people at the bottom, and emotionally wracking, since as soon as a loved one dies you’re now under the gun to sell.
I agree though, second homes should be extremely heavily taxed. I just think we need to approach it with an even hand and make sure that we are targeting big corporate rental agencies and the very wealthy, and not some family that just lost their parents/grandparents. Something about targeting those people seems needlessly aggressive and not really the intention being discussed…
Rent apartments. Own houses.
*Since some people really need every combination addressed: Rent/own apartments. Own houses.
How do you handle situations where people want to live temporarily in houses? An example would be a traveling nurse that doesn’t want to be in an apartment building.
May people prefer to rent houses over owning one. Many of them I speak to tell me they want nothing to do with house maintenance and upkeep and they prefer to rent so that they don’t have to think or worry about any of the repairs. They like being able to just call the property manager when the hot water stops working or when their kiddo accidentally breaks a window.
Well that’s all well and good until every house rental in your area starts requiring you to either do the maintenance anyway, or pay for it. So you get to pay for the house, and you get to maintenance the house, but you don’t get to own the house.
I’ve watched things change in just the last 5 years where renting a house means you have to maintenance everything that isn’t structural, including lawn care, but you don’t own any stake in the house, and you can forget about putting up a shelf or a new coat of paint. And now that you’re paying the mortgage and taxes on this house, you’re paying for all the utilities for the house, and are fixing all the problems that occur with the house, the landlord gets to send people over whenever they want to that get to go inside your house and look around without you being home just to make sure you’re taking care of it the way they want you to. And then when you leave, either because you found a better deal, or the landlord just doesn’t feel like renting it to you anymore, you get the pleasure of walking away with nothing.
How would you move? Need to time the buying and selling just right?
Just have a government agency be a middle man.
Oh so the government can own residential housing! Theres no way that could possibly go wrong
Too bad. You need a centralized authority to manage territory and governments already do this for land, so they can combine land and the real estate on it and distribute it to people fairly.
If you think it’s problematic, then you need to take better control of your government.
It’s either that or corporations who don’t care hog all of the land and housing.
Sure I will just go ahead and take control of my government, great suggestion.
Chop chop
Posted in a Canadian channel before, because I am Canadian:
The housing crisis arises out of one problem, and one problem only:
Housing as an investment.
That’s not to say foreigners are to blame - at less than 2% of the market, they don’t have any real impact. British Columbia’s laws against foreign home ownership is nothing more than a red herring, a bullshit move designed to flame racism and bigotry. Yes, some of them are just looking to build anchors in a prosperous first-world country, but most are honest buyers.
A better move has been the “speculation tax”. By taxing more heavily any home that remains empty, it encourages property holders to actually rent these units out, instead of holding out for people desperate enough to pay their nosebleed-high rents.
But all of this misses the real mark: housing used purely as investment.
Now, to be absolutely clear, I am not talking about landlords who have a “mortgage helper” suite, or who have held on to a home or two that they previously lived in. These are typically the good landlords that we need - those with just two or three rental units, and that aren’t landlording as a business, just as a small top-up to their day job or as an extra plump-up to the retirement funds they are living off of. By having many thousands of separate landlords instead of one monolith, healthy competition is preserved.
No, there are two types of “investors” that I would directly target:
- Flippers
- Landlords-as-a-business.
1) Flippers
The first group, flippers, also come in two distinct types:
- Those that buy up homes “on spec” before ground has even been turned, and then re-sell those same homes for much more than they bought shortly before these homes are completed. Sometimes for twice as much as they paid.
- Those that buy up an older, tired home, slap on a coat of paint, spackle over holes in the walls, paper over the major flaws in hopes that inspectors don’t catch them, and shove in an ultra-cheap but shiny Ikea kitchen that will barely last a decade, then re-sell it for much more than they paid for it.
Both of these groups have contributed to the massive rise in housing purchase prices over the last thirty years. For a family that could afford a 3Bdrm home in 2000, their wages have only increased by half again, while home values have gone up by five times by 2023.
And this all comes down to speculation driving up the cost of homes.
So how do we combat this? Simple: to make it more attractive for owner-occupiers to buy a home than investors.
A family lives in a home that they own for an average of 8 years. Some less, most a lot more. We start by taxing any home sale at 100% for any owner who hasn’t lived in said home as their primary residence for at least two years (730 contiguous days). We then do a straight line depreciation from the end of the second year down to 0% taxation at the end of the eighth year. Or maybe we be kind and use a sigmoid curve to tax the last two years very minimally.
Exceptions can exist, of course, for those who have been widowed, or deployed overseas, or in the RCMP and deployed elsewhere in Canada, or where the house has been ordered to be sold by the court for divorce proceedings, and so forth. But simple bankruptcy would not be eligible, because it would be abused as a loophole.
But the point here is that homes will then become available to those working-class people who have been desperate to get off of the rental merry-go-round, but who have been unable to because home prices have been rising much faster than their down payment ever could.
This tax would absolutely cut investors off at the knees. Flippers would have to live in a home much, much longer, and spec flippers would be put entirely out of business, because they can’t even live in that house until it is fully completed in the first place.
2) Landlords-as-a-business
The second group is much simpler. It involves anyone who has ever bought a home purely to rent it back out, seeking to become a parasite on the backs of working-class Canadians in order to generate a labour-free revenue stream that would replace their day job. Some of these are individuals, but some of these are also businesses. To which there would be two simple laws created:
- It would become illegal for any business to hold any residential property whatsoever that was in a legally habitable state. This wouldn’t prevent businesses from building homes, but it would prevent a business from buying up entire neighbourhoods just to monopolize that area and jack up the rent to the maximum that the market could bear.
- Any individual owning more than 5 (or so) rental units (not just homes!) would be re-classified as operating as a business, and therefore become ineligible to own any of them - they would have to immediately sell all of them.
As for № 2, a lot of loopholes can exist that a sharp reader would immediately identify. So we close them, too.
- Children under 24 “operate as a business” automatically with any rental unit. They are allowed ZERO. Because who TF under the age of 25 is wealthy enough to own rental units? No-one, unless these units were “gifted” to them from their parents, in an attempt to skirt the law. So that is one loophole closed.
- Additional immediate family members are reduced by half in the number of rental units they can own. So if a husband has the (arbitrary, for the sake of argument) maximum limit of five, the wife can only have two herself. Any other family member who wants to own a rental unit, and who does not live in the same household, must provide full disclosure to where their money is coming from, and demonstrate that it is not coming from other family members who already own rental units.
By severely constraining the number of investors in the market, more housing becomes available to those who actually want to stop being renters. Actual working-class people can exit the rental market, reducing demand for rental units, and therefore reducing rental prices. These lower rental prices then make landlording less attractive, reducing the investor demand for homes and reducing bidding wars by deep-pocketed investors, eventually reducing overall home values for those who actually want to buy a home to live in it.
Plus, landlords will also become aware of the tax laid out in the first section that targets flippers. If they own rental units that they have never lived in as their primary residence, they will also be unable to sell these units for anything other than a steep loss. They will then try to exit the market before such a tax comes into effect, flooding the market with homes and causing prices to crash. They know that they are staring down two massive problems:
Being stuck with a high-cost asset (purchase price) that only produces a low-revenue stream because renters have exited the market by buying affordable homes, allowing plenty of stock that is pincered by the spec tax that heavily taxes empty rental units, thereby lowering rental prices well beneath the cost of the mortgage on the unit.
By putting these two tools into effect at the same time, we force a massive exodus of landlords out of the marketplace, crashing home values to where they become affordable to working-class people, thereby massively draining the numbers of renters looking for places to rent. Those places still being rented out - by owners who have previously lived in them, or by investors who couldn’t sell in time - would significantly outnumber renters looking for a place to rent, thereby crashing rental prices as renters could then dictate rents by being able to walk away from unattractive units or abusive landlords.
Full disclosure: I own, I don’t rent. But I have vanishingly little sympathy for greed-obsessed parasites that suck the future out of hard-working Canadians who must pay 60% or more of their wages for shitbox rentals to abusive landlords in today’s marketplace. Most people (and pretty much anyone under the age of 30) who don’t already own no longer have any hope of ever owning a house, as their ability to build a down payment shrinks every year, while home values accelerate into the stratosphere.
Creating massive penalties equal to the whole cost of a house for anyone that sells after less than 6-8 years would have devastating unintended consequences. It might make flipping impractical, but it would also hurt a lot of people who find themselves in a position where they need to sell, and would increase the risks associated with buying a house for lower income buyers.
It would help if you targeted the profit from the sale instead of the whole price. Flipping is about buying low, minimizing the cost of improvements, and then selling for a massively inflated amount. Without that profit it’s not worth it. For a normal person, being able to make money on the deal is nice, but at least recouping your costs can keep you economically stable and allow you to move on with your life.
I also think that you would want to combine this with some plan for helping low income buyers with the restoration of neglected properties that would normally be snatched up by flippers.
I also think the arbitrary age restriction on owning a rental property needs an exemption for inherited properties if nothing else. A 20ish year old who inherits a home or rental property when their parent(s) die is not abusing a loophole, and immediately hitting them with additional legal problems and forcing them to sell a house that has a tenant already in there is just unnecessary chaos for everyone involved.
I’m also curious how large apartment complexes fit into this plan. Are they also banned? Do you just need an owner to occupy a (potentially much nicer) apartment in the building? If you can still operate a huge apartment complex, I would expect the market to shift heavily towards those. If you can’t well, that raises it’s own issues around urban housing and population density.
Great ideas. Too bad our politicians don’t listen to us.
A co-op is another form of corporation. Dense, multi-family structures should be done that way.
What we don’t want is for housing to be a speculative investment. Remove the profit motive of holding a house that’s empty and reselling.
Up until very recently most housing in Finland was co-ops, and it’s still extremely common although many new developments are built and owned by corporations which then rent them out.
I live and own shares in a new housing co-op (proportional to the size of my apartment), and all of us together own and run the building and we’re renting the property from the city (although you can buy your share of that property off from the city if you don’t want to pay that rent.) It’s not a perfect system by any means but it’s better than corporations owning everything; ideally the people who live in a building are the ones who decide how it’s run, but of course that’s sort of gone out the window too with rich people just buying properties speculatively and to rent them out. If enough of the shareholders in a building are rent-seekers, upkeep of the building is going to go way down because they don’t live there themselves and don’t give a shit about whether it’s a nice place to live in, they care about making a profit.
no real estate taxes for the first house owned, heavy and progressive taxes starting on the second, is an idea
companies get called people all the time, i’m starting to believe it, but i still think they don’t need shelter, so they shouldn’t be able to aquire a basic human need
That sounds like a solution but isn’t. In my experience, the corporations I had as landlords were completely aware of what they are allowed to do and are obligated to do. The private landlords I had were the craziest bitches imaginable. Stuff didn’t happen as it should have, laws were intentionally misinterpreted and twisted, etc.
The reason why my experience differs so much is laws. Here in Germany, we’ve got strong renter’s protection laws. They are still too weak in some places but really, really clear in most. So while my private landlord tried to make me pay for repairs, the company doesn’t bother with such illegal bullshit, sends over a contractor they work with regularly and shit gets done.No person should be allowed to own more residential property than they’re realistically need for living.
I’m just curious how we’ll define “realistic”, because someone who’s into just software programming might be satisfied with a studio apartment. I can’t live without my basement workshop however. I like to make stuff.
That’s valid. But, for example: You don’t need a dozen of different houses.
Landownership is wrong all together.
If you think about it, it is completely absurd, why anyone assumes the right to ‘own’ a piece of land. Or even more land than the other guy. Someone must have been the person to first come up with the idea of ownership, but it is and was never based on anything other than an idea, and we should question it.
After all inheritance of landownership is a major cornerstone of our unjust and exploitative society.
Every generation, people want to try new things and it’s nice. But landownership can and has been and good thing in a way that just going back to “anarchy” wouldn’t work. E.g. creation of ghettos, who gets to farm the best land, etc.
So then the suggestions are that the land are owned and “managed” by the state apparatus. Now we have a few famines in history to show us how gaining favor in a political system is not the best way to manage the land.
I’m open to better suggestions but just shitting on land ownership seems easy and unproductive.
Holy shit I didn’t expect such a quality comment in this discussion.
I would argue that corporations shouldn’t be able to own residential land, and regular people shouldn’t own more than two land pieces.
I’m pretty sure the Native Americans didn’t believe in land ownership, at least not individual land ownership, more of a communal version, and it worked out well for them. They had huge societies, vast trade networks, and were able to feed themselves fine. It requires a different, non-capitalist, non-Western mindset, but it can work.
Their huge societies in no way are comparable to the population we have today.
Neither was the Western population at the time, but it scaled up fine. There’s nothing saying alternative systems of land ownership can’t scale up either. The only reason we went with the current one is because it benefited the people who killed everyone else.
Now we have a few famines in history to show us how gaining favor in a political system is not the best way to manage the land.
Doesn’t that also mean The Irish famine shows private land ownership isn’t the best way to manage land?
The potato famine was caused by a new type of blight being brought from the Americas back to Europe.
I don’t see how being beaten by a novel disease has anything to do with private land ownership.
People like the idea of the stability ownership offers. You can’t be kicked out of your house or off your land you own because your income dropped out lost a job. How would you suggest this stability is maintained?
Unfortunately land will fall into disrepair if someone doesn’t actually own it. They have no incentive to invest in its upkeep if it can just be taken away at any moment. There’s a reason rental buildings have a reputation for being unkempt, the renters don’t want to pay for the upkeep since it’s not theirs and the landlords don’t want to pay for the upkeep because they don’t live there.
It gets even worse if government owns it, it would take 6 months just to get a light bulb changed let alone a new roof or hedges trimmed.
That might be the case in your country, but there are many cultures that are perfectly capable of sharing and keeping common infrastructure in good conditions. Your personal experience isn’t generic and globally true.
A country’s land should not be owned by individuals, in my opinion, but used by those who need it and when they do so. A country’s land is what makes it a land, so it cannot be owned or sold. Someone inheriting it from someone who took it and maybe sold it should give no legitimate claim to possession.
It goes back to when good agricultural land discovered to be so ridiculously effective at feeding people.
Not the beginning of wealth, but certainly one of the oldest still used store of wealth.
So much has been fucked up by discovering agriculture, it was also the beginning of institutional slavery.
You’re not wrong but surely you don’t mean to say that mankind should never have discovered agriculture, right? At that point we may as well say that gaining sentience fucked everything up because it was the beginning of wilfully hurting others despite having the capacity for empathy (aka doing evil things).
but surely you don’t mean to say that mankind should never have discovered agriculture, right?
RETURN TO MONKE
No I’m serious, and I understand you mean well but I can’t have this discussion meaningfully with you without writing 8 paragraphs of context.
There’s a lot of what Pratchett called ‘lies to children’ when it comes to non-university anthropology, things we learned in school that were kind of outdated already and gross oversimplifications.
We were told that agriculture allowed the free time to specialize and was the beginning of culture but the truth is that all that hunter-gatherer man needed to hunt to feed himself and 3 other people was about 6 hours of actual work a week. And specialization already existed with stone knapping and pottery.
There’s a lot more to it but I don’t really have the patience to keep writing this.
Well, you did a good job condensing where you were coming from in two paragraphs. Enough to make me realise that I mistook your original meaning completely. I hadn’t heard the 6 hours of work a week number before. In fact, I’ve never really questioned the logic I was taught with regards to agriculture being the start of civilisation due to freeing up hands and allowing people to settle down, because hunter gatherers would have to roam around at least a little to follow herds or seasonal effects on available forage. That understanding was based on what I’ve learned in history 101 at high school though.
I started out a bit argumentative because I read your comment as an overly dramatic lamentation that I took to mean something like: “people are so bad I wish we weren’t born/evolved”. Thanks for taking the time to kindly explain. I’m always interested in having a possible blind spot or internalised assumption revealed and to reassess entrenched beliefs.
One other thing to point out is that agriculture allowed for large mobile armies.
For hunter gatherers it wasn’t easy to stockpile enough long term storage portable food to take to war, nor could you predict periods of bounty (which is why so many ancient cultures had prohibitions to making war during winter that almost no one broke) to plan long term campaigns. This style of sustenance also kept nomadic band population low as following the herds and the reduction of ease of hunting and complications in moving gave significant advantage to smaller social units.
We see a radical increase in social group size with the advent of agriculture, eventually leading to more permanent town and eventually city living instead of nomadic bands as you generally needed to be in one place to keep others from taking your crops and tending them year round.
I fully understand that there are a lot of luxuries and even just basic life improvements that wouldn’t be available to us if we had kept as small hunter gatherer bands, and maybe a lot of people alive now couldn’t survive or thrive in that kind of environment, it would be a very, very different world than what we know today but one thing I do know is that of we had never discovered agriculture we would never have eventually become a species that could kill off 95% of the life on the planet with the press of a button.
As someone who lives in a corporate owned building which is an unmitigated disaster, I agree.
If you don’t like it why don’t you move to a better building with better management?
You realize moving is a big deal, right? I could talk for 20 minutes about the challenges but the biggest one currently is that I’m extremely far from my lease’s end date.
