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If the government rents out places below market races, it is subsidizing those renters. It is leaving money on the table that it could use to pay for things tha
by anothercomment 10y ago
If the government rents out places below market races, it is subsidizing those renters. It is leaving money on the table that it could use to pay for things that it pays for with taxpayer money from Munich instead.
- posterboy 10y agoIf the price is equal to the utility cost, then it isn't below market rate, but exactly matching it. The other prices are over market rate.
- anothercomment 10y agoHow do you define utility cost - isn't it kind of equivalent to market rate (what it is worth for people to pay)? I can not really make sense of your statement? If the prices are over market rate, how to they find renters?
- posterboy 10y agoUtility cost was the wrong idiom, I meant, like, the overall expenses. Keep in mind the OP before you > ... and that's a big if ... In other words, If the government can operate housing over a long term at break-even, a stabilizing market needs to be converging towards that limit, otherwise they couldn't break even. I was implicitly limiting my remark to the market rate of the expenses, not the income of the operation. The same can be applied to the other side of the equation, the price the inhabitants have to pay. The market can be stable only if both sides match. Of course that's a gross simplification, but so is the term market rate.