4 ms·

Let's for a second assume that people stay in the same house for 30 years[1]. Why can't they just purchase the house cooperative slowly with each rent payment ?

• CydeWeys 11y ago
  The people in the linked article are frequently moving between housing, though. If they had thirty solid years of employment lined up they wouldn't be in their situation to begin with. What you're proposing is rent-to-own, which the vast majority of people would never make any headway on.
  • petra 11y ago
    What about adding something like transferable shares mechanism - so so you could use your ownership stake in another house if you want you need to move?
    • danbolt 11y ago
      Maybe I'm missing something, but I don't see how that helps if there's little to no equity in the first place.
    • morgante 11y ago
      So, money?
• tmptmp 11y ago
  Maybe it worked for Israel, because it was run by politicians who cared about their people and not by those who cared for the interests of mainly the mega-corporations (e.g. USA) or the interests of mainly the party-workers (e.g. USSR). Such schemes from government are a must. They are much better than "welfare" which just encourages people to be lazy. Edit: added about "welfare".
  • petra 11y ago
    It worked pretty well in the USSR - housing was generally not a problem. Heck even after the collapse of the USSR economy, people still had a place to live. Can you imagine how hellish it would be if it happened in the US , when everything is private and most don't own?
    • golergka 11y ago
      What are you even talking about? Apartments in USSR were infamously hard to get, and even now, significant part of tge population lives in dorms, communal apartments or in buildings too dangerous to live in. Plus, USSR has a long tradition of several generations of the same family living in the same apartment together, a room per family.
• sokoloff 11y ago
  Largely because of the "Dodd-Frank Wall Street Reform and Consumer Protection Act" of 2010. That's right, government protecting the people again; in this case, lease-options or lease-purchase agreements with a financing component where the purchaser is living in the property during the term are now deemed consumer financing arrangements (rather than real estate financing arrangements), which are subject to review by the then-newly-created Consumer Financial Protection Bureau. It all but dried up the willingness of sensible sellers to write lease-options on property where the lessee would live in the structure. Yes, there was some amount of fraud and exploitation under the old laws as well, but now that entire mechanism was closed off to property owners willing to sell and [typically] working-class families looking to buy.
  • yourapostasy 11y ago
    This is interesting. A quick search turned up an article [1] that outlined some of the difficulties with lease-to-own residences I wasn't aware of. However, the CFPB is likely on the losing side if the leases are structured as short-term rentals, terminable at any time, as Rent-A-Center has done [2]. This type of consumerism is likely to be self-correcting over generations of time; I'm seeing far less participation by Millenials and younger generations for this consumerism than older generations, by simple virtue of the fact that they are quite drained of financial resources and growth potential by the time they graduate. If this trend is real and continues, then the velocity of money could seem great while juiced by the Fed, then drop like a cliff function when demographic realities trump monetarism and lack of fiscal policy changes in the US. [1] http://www.mhmarketingsalesmanagement.com/home/featured-articles/april-2011/1539-is-lease-to-own-a-safe-harbor-from-the-safe-act http://www.mhmarketingsalesmanagement.com/home/featured-arti... [2] http://www.huffingtonpost.com/2012/02/03/rent-a-center-cfpb-richard-cordray_n_1250033.html http://www.huffingtonpost.com/2012/02/03/rent-a-center-cfpb-...
    • sokoloff 11y ago
      No, I think it's much worse than that. There's a general sentiment that triple penalties are applicable (or a danger at least) if a seller is remiss in qualifying the lessee/optinee at the time the contract is struck. The idea being that if a few years down the road, the lessee can't qualify for a mortgage and loses all their option premium money, they've been taken advantage of. So, the only safe thing is to underwrite the lessee for a mortgage at the time the contract is written. Hint: most of these people can't qualify for a mortgage, otherwise they'd just buy outright.