5 ms·

This comment doesn't stand up to scrutiny. There aren't a lot of available statistics on how wealthy landlords are, but for instance, according to a San Francis

This comment doesn't stand up to scrutiny. There aren't a lot of available statistics on how wealthy landlords are, but for instance, according to a San Francisco property owners survey[1], median income for landlords is $90k, only 15% higher than the overall San Francisco median income ($77k). And of course a software engineer's median income in San Francisco is higher ($92k). Either way, there is little evidence that in one of the hottest real estate markets in the country, landlords would be 'substantially' richer than tenants on average. Of course, income is only a component of wealth--no doubt the property owned is worth quite a bit--but, according to the same report, at least 75% of these landlords are still paying mortgages on their properties, and over 10% spend more than their rental income on their mortgages! Since most landlords borrow money to buy property, then attempt to sell access to that property profitably over time, they are more like entrepreneurs than the land baron 'monopolists' portrayed by the Churchill quote above. This isn't wealth redistribution in any direction. It's a trade. Renters get access to property without having to own it. Owners, if they are smart and/or lucky, can profit from property, but of course take a substantially larger up front risk. And, I would be remiss if I didn't point out that Winston Churchill was from one of the wealthiest British aristocratic (read: rentier landowning) families and was born in the family home, this palace[2]. [1] http://sfrb.org/sites/default/files/FileCenter/Documents/1887-SFLandlordSurveyReportFinal.pdf http://sfrb.org/sites/default/files/FileCenter/Documents/188... [2] https://en.wikipedia.org/wiki/Blenheim_Palace https://en.wikipedia.org/wiki/Blenheim_Palace

danharaj 9y ago
I don't think medians are the right thing to look at here. The majority of individual landlords will be small-time, but it's the behavior and impact of the largest landlords that is important.
underwoodley 9y ago
You didn't challenge the statement to GP made, but one he didn't make. He didn't say that landlords are vastly richer than workers. He said that landlords make little or no contribution to the general welfare. Your own comment points out that in SF, the median landlord makes roughly what the median software developer makes. But a software developer in the Bay Area is one of the most productive workers on the planet, with a literally unparalleled opportunity to generate value, both for the company he works for, and for global society/consumers in general. In contrast, the landlord does not produce anything.
- Allower 9y ago
  Renting is a service, of course they don't produce anything. If they weren't providing a service people found valuable (i.e. improving their general welfare) much fewer people would be renting.
- AnimalMuppet 9y ago
  The landlord produces a place for people to stay. Why is that "nothing"? I've rented. I didn't like paying rent every month, but it beat sleeping in my car. Do you think the landlord should provide apartments for free? Returning to Churchill's statement: Every one of those improvements improves every landowner, whether a landlord or a homeowner. For every one of them, they have done nothing - except pay taxes. (But note that the landlords pay taxes too.) So why single out the landlords?
  - logfromblammo 9y ago
    You're ignoring the economic choices not taken. The investor capitalized the builder, and the builder constructed the housing, and the lender capitalized the landlord, and the landlord bought the building, all because they knew that people need to have a place to exist, and that the spot they picked was a likely spot. If renting were somehow not allowed, none of them would have any use for that spot. There would not be that same building there, but there is the possibility that there would be a 12 bed + 1 outhouse shanty/bunkhouse there instead, which would also be better than sleeping in your car, but only just barely. And the cost of your kip would be much less. There is also the possibility that instead of just one 3200 sq.ft. house with grass-covered yard, there would be a low-rise tenement-style condo-plex with 8 units at 1600 sq.ft. each, with limited covered parking and no lawn. With enough of those on the same street, there might also be a bus stop nearby, and competition among local utilities. But by defining that plot as one place for one family to live, the landlord and his financiers has ensured that no matter how big it is, it is too expensive for the renter to easily buy it. If the landlord did not exist, that plot would have to be divided into as many places as is necessary to bring the price down to what those who will be occupying those places can afford to pay each other to stay out of someone else's spot.
- 9y ago
adwhit 9y ago
The point is that the landlord becomes wealthier through improvements to the area, for which s/he is not responsible. i.e. they are capturing public investment. Put concretely, my taxes go towards upgrading the Overground Line which improves the area I live in which increases my rent. I have paid for this improvement twice, my landlord, zero times (their get back their taxes through uplift in property value). Solution - as others have pointed out - is Land Value Tax.
- aaron-lebo 9y ago
  My landlord takes care of their properties and the area around them increases in value partially due to that. Surely they have some responsibility?
- bmmayer1 9y ago
  The landlord has to pay higher property taxes as their property becomes more valuable, which often go in turn to paying for those improvements. It's not a one-way transfer, there's a quid pro quo. Now you may argue landlords get more than they give, but that's an entirely different point.
  - njarboe 9y ago
    True in most places. California's prop 13 caps property value increases for tax purposes to 2% per year. This includes land held by corporations, not just grandma.

danharaj 9y ago

I don't think medians are the right thing to look at here. The majority of individual landlords will be small-time, but it's the behavior and impact of the largest landlords that is important.

underwoodley 9y ago

You didn't challenge the statement to GP made, but one he didn't make. He didn't say that landlords are vastly richer than workers. He said that landlords make little or no contribution to the general welfare. Your own comment points out that in SF, the median landlord makes roughly what the median software developer makes. But a software developer in the Bay Area is one of the most productive workers on the planet, with a literally unparalleled opportunity to generate value, both for the company he works for, and for global society/consumers in general. In contrast, the landlord does not produce anything.

Allower 9y ago
Renting is a service, of course they don't produce anything. If they weren't providing a service people found valuable (i.e. improving their general welfare) much fewer people would be renting.
AnimalMuppet 9y ago
The landlord produces a place for people to stay. Why is that "nothing"? I've rented. I didn't like paying rent every month, but it beat sleeping in my car. Do you think the landlord should provide apartments for free? Returning to Churchill's statement: Every one of those improvements improves every landowner, whether a landlord or a homeowner. For every one of them, they have done nothing - except pay taxes. (But note that the landlords pay taxes too.) So why single out the landlords?
- logfromblammo 9y ago
  You're ignoring the economic choices not taken. The investor capitalized the builder, and the builder constructed the housing, and the lender capitalized the landlord, and the landlord bought the building, all because they knew that people need to have a place to exist, and that the spot they picked was a likely spot. If renting were somehow not allowed, none of them would have any use for that spot. There would not be that same building there, but there is the possibility that there would be a 12 bed + 1 outhouse shanty/bunkhouse there instead, which would also be better than sleeping in your car, but only just barely. And the cost of your kip would be much less. There is also the possibility that instead of just one 3200 sq.ft. house with grass-covered yard, there would be a low-rise tenement-style condo-plex with 8 units at 1600 sq.ft. each, with limited covered parking and no lawn. With enough of those on the same street, there might also be a bus stop nearby, and competition among local utilities. But by defining that plot as one place for one family to live, the landlord and his financiers has ensured that no matter how big it is, it is too expensive for the renter to easily buy it. If the landlord did not exist, that plot would have to be divided into as many places as is necessary to bring the price down to what those who will be occupying those places can afford to pay each other to stay out of someone else's spot.
9y ago

adwhit 9y ago

The point is that the landlord becomes wealthier through improvements to the area, for which s/he is not responsible. i.e. they are capturing public investment. Put concretely, my taxes go towards upgrading the Overground Line which improves the area I live in which increases my rent. I have paid for this improvement twice, my landlord, zero times (their get back their taxes through uplift in property value). Solution - as others have pointed out - is Land Value Tax.

aaron-lebo 9y ago
My landlord takes care of their properties and the area around them increases in value partially due to that. Surely they have some responsibility?
bmmayer1 9y ago
The landlord has to pay higher property taxes as their property becomes more valuable, which often go in turn to paying for those improvements. It's not a one-way transfer, there's a quid pro quo. Now you may argue landlords get more than they give, but that's an entirely different point.
- njarboe 9y ago
  True in most places. California's prop 13 caps property value increases for tax purposes to 2% per year. This includes land held by corporations, not just grandma.