3 ms·

I'm really confused... The thing of value you are providing as a landlord is housing. How is it skimming? Putting money towards a house/condo instead of investi

I'm really confused... The thing of value you are providing as a landlord is housing. How is it skimming? Putting money towards a house/condo instead of investing it in business has an opportunity cost. You lose out on the profits from dividends/interest/cap gains. That has to be replaced. If you charge too much rent, other people will under-cut you. The price is set by available housing. Where is the deceit? Do you feel you would owe people the freedom to use your property free-of-charge? What about the mortgage payments you endure? The maintenance/upkeep (roofs, siding, carpet, plumbing, electrical, all amortized over the life of the building)? Should this be a loss you take in order to let someone else sleep in your house? Disclosure of bias: In Seattle where I live, the cost of real estate is higher than the prevailing rents, when you factor mortgage payments, maintenance, utilities, HOA, etc. This makes it a little easier for me to see the equity in pricing between rentals and owned homes. It may be different in your parts of the world.

t2015_08_25 11y ago
It's got nothing to do with deceit or skimming, it's power. There is no fraud, it would be simply taking advantage of people beyond the amount of value that I would be interesting in providing. Your allusion to a market that would correct the price doesn't account for a market which no tenants can enter because none of them can afford the entrance (a 20% down payment). They'll get the benefit of housing no matter how much I would charge, but if I charge more than the value of the maintenance and accounting them I would be exploiting them, taking advantage of their inability to produce capital in the time it's taken me to produce it. And everyone else who is in the position I am could exploit them just as easily so the market doesn't help there. It's like gas prices: if so many gas stations can compete, how come they prices aren't driven down to nothing? Because of the entrance cost to the market. You can't start a well and refinery, so you have to go to one of the established ones. For luxury items like phones, art, fancy cars, etc., I don't care about charging people a lot of money. But for water, air, food, medical and housing, which people have no choice to acquire or consume I'm not going to gouge them. This is not some rational choice about what a person or market theory can or should do, this is my personal code of ethics.
- OrwellianChild 11y ago
  Not trying to change your mind, and I appreciate the chance for a dialogue... Your perspective seems based on the idea that housing (shelter) is a basic need and should be provided for, and at some fundamental level I'm inclined to agree. (In my mind, it would be pretty basic housing...) I did want to call attention to your gas prices example... Gas prices are driven down to approximately the cost of getting more oil out of the ground, refining it into gasoline, and transporting it to your local Chevron. These are costs inherent to "making gas" - it's not free. The same goes for housing, so whether you'd have renters pay it or have the government pay it for them, someone's going to have to cut down trees, pour concrete, level land, install plumbing, etc. This is this "value" of the housing I'm talking about, which is separate from the moral right to shelter that seems to guide your judgement on the issue. Thanks for being willing to engage me in the discussion!
  - kamaal 11y ago
    >>Your perspective seems based on the idea that housing (shelter) is a basic need and should be provided for There is a very unfortunate problem with this line of thinking. It takes a lot of effort/money to build a house. You need to procure raw materials, pay for human labor and various other expenses, this is apart from acquiring land. And the problem with this kind of 'equality for all' argument towards housing is you are assuming, that a good quality home should either come at a cheap price or some one being ready to pay and make up for everybody else. Both of them are problematic, why should every single economic link in the chain related to building a house suffer? Or why are we expecting some people to pay taxes and have houses built for every one else? You don't have the right to anything unless the cost of achieving that is literally free or negligible.
    - branchless 11y ago
      This is so wrong it hurts. The cost of the "house" is the land. Building houses has never been cheaper. Just like everything else has never been cheaper.
      - 11y ago

t2015_08_25 11y ago

It's got nothing to do with deceit or skimming, it's power. There is no fraud, it would be simply taking advantage of people beyond the amount of value that I would be interesting in providing. Your allusion to a market that would correct the price doesn't account for a market which no tenants can enter because none of them can afford the entrance (a 20% down payment). They'll get the benefit of housing no matter how much I would charge, but if I charge more than the value of the maintenance and accounting them I would be exploiting them, taking advantage of their inability to produce capital in the time it's taken me to produce it. And everyone else who is in the position I am could exploit them just as easily so the market doesn't help there. It's like gas prices: if so many gas stations can compete, how come they prices aren't driven down to nothing? Because of the entrance cost to the market. You can't start a well and refinery, so you have to go to one of the established ones. For luxury items like phones, art, fancy cars, etc., I don't care about charging people a lot of money. But for water, air, food, medical and housing, which people have no choice to acquire or consume I'm not going to gouge them. This is not some rational choice about what a person or market theory can or should do, this is my personal code of ethics.

OrwellianChild 11y ago
Not trying to change your mind, and I appreciate the chance for a dialogue... Your perspective seems based on the idea that housing (shelter) is a basic need and should be provided for, and at some fundamental level I'm inclined to agree. (In my mind, it would be pretty basic housing...) I did want to call attention to your gas prices example... Gas prices are driven down to approximately the cost of getting more oil out of the ground, refining it into gasoline, and transporting it to your local Chevron. These are costs inherent to "making gas" - it's not free. The same goes for housing, so whether you'd have renters pay it or have the government pay it for them, someone's going to have to cut down trees, pour concrete, level land, install plumbing, etc. This is this "value" of the housing I'm talking about, which is separate from the moral right to shelter that seems to guide your judgement on the issue. Thanks for being willing to engage me in the discussion!
- kamaal 11y ago
  >>Your perspective seems based on the idea that housing (shelter) is a basic need and should be provided for There is a very unfortunate problem with this line of thinking. It takes a lot of effort/money to build a house. You need to procure raw materials, pay for human labor and various other expenses, this is apart from acquiring land. And the problem with this kind of 'equality for all' argument towards housing is you are assuming, that a good quality home should either come at a cheap price or some one being ready to pay and make up for everybody else. Both of them are problematic, why should every single economic link in the chain related to building a house suffer? Or why are we expecting some people to pay taxes and have houses built for every one else? You don't have the right to anything unless the cost of achieving that is literally free or negligible.
  - branchless 11y ago
    This is so wrong it hurts. The cost of the "house" is the land. Building houses has never been cheaper. Just like everything else has never been cheaper.
    - 11y ago