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Why is it good for the government to buy up property and rent it at below market prices? That's just a handout and is inefficient, discouraging denser housing.

• toomuchtodo 7y ago
  Call it what you want, that's what they're optimizing for. Some people can't afford market prices, and this is the hack around that market failure. You call it a handout, I call it compassionate government.
  • ikeboy 7y ago
    A far better "hack" would be LVT+get rid of zoning and other restrictions on building. That would actually reduce market prices instead of requiring a subsidy. >Compassionate government Nope, a government driving up market prices by restricting new construction is not compassionate just because they tried to help a handful of families buy below market.
    • toomuchtodo 7y ago
      This is in Houston. They already have some of the most lax zoning in the country. You're free to your opinion this is "inefficient" and causes "perverse incentives". In the meantime, people get homes they otherwise wouldn't. Some of us consider that a win.
      • ikeboy 7y ago
        The article is about land trusts in general, not just the one in the headline. Regardless, the correct solution is to implement LVT. Without that, almost by definition market prices will be higher than they should be. The market failure is the government permitting people to buy and sell land. A small trust buying up some land and taking it off the market doesn't fix the underlying failure.
        • toomuchtodo 7y ago
          And like a carbon tax, a land value tax will never be implemented in the US due to entrenched interests. > The market failure is the government permitting people to buy and sell land. A small trust buying up some land and taking it off the market doesn't fix the underlying failure. This argument is hopeless. Good chat.
          • ikeboy 7y ago
            Fine, you want a policy that's better than the one described in OP but feasible on a small scale? Have the city buy up land and rent it out at market price. Allow any kind of housing to be built on top of it, have no requirements for income etc. Then use the profit this produces over the current system to directly subsidise low income households. This is more efficient and has the same subsidy effect.
            • deleted 7y ago
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        • gowld 7y ago
          The article is literally about preventing speculation by capping resale prices. That's pretty much equivalent to preventing buying and selling.
          • deleted 7y ago
            [deleted]
          • ikeboy 7y ago
            Preventing buying and selling of housing is actively harmful. Land shouldn't be sold, it should all be owned by the state and leased out at market value; equivalently, implement LVT at close to 100% of land value. The state setting a maximum sale price and subsidizing demand is not that.
            • WalterBright 7y ago
      • mikem170 7y ago
        >This in Houston. They already have some of the most lax zoning in the country. Houston has zoning, they just don't call it zoning, and it's a mess. https://kinder.rice.edu/2015/09/08/forget-what-youve-heard-houston-really-does-have-zoning-sort-of https://kinder.rice.edu/2015/09/08/forget-what-youve-heard-h... The parent was talking about the government getting out of the way and letting people build denser neighborhoods. Japan has a good zoning model, based on population density and flexible land use. In the U.S. zoning is used to restrict the supply of housing. Building codes exist for safety. What is the reason for zoning? To protect to investment of current homeowners and screw everyone else?
        • toomuchtodo 7y ago
          Zoning is so that a meat packing plant isn’t built next to a residential neighborhood. I won’t disagree that there are challenges with zoning, where upzoning is an uphill battle (I myself face these challenges as a real estate investor who prefers to build multi family properties in an effort to create affordable housing), but I understand why it exists and have an appreciation for the intent behind it.
          • enaaem 7y ago
            But what if I want to build a home next to a meatpacking plant? The Japanese zoning system designates nuisance levels to land. The lowest level only allows residential and the highest allows industrial. The general principal is that you are allowed build a low nuisance building in a high nuisance zone, but not vice versa.
    • harimau777 7y ago
      Is there an alternative to zoning that still protects people from externalities such as someone building a loud nightclub or a dangerous chemical plant next to someone's home?
      • bluGill 7y ago
        Blanket noises ordancenes. If I'm not a nightclub but I blast loud music am I okay? If I want to build a nightclub with good sound insulation so you can't hear why should you care?
        • KozmoNau7 7y ago
          A nightclub doesn't just produce noise. Nightclubs attract crowds, some of which will be rowdy, drunk and belligerent. They will urinate and defecate in doorways, cause property damage and may be violent, depending on the type of crowd the club attracts.
• itronitron 7y ago
  >> Why is it good for the government to buy up property and rent it at below market prices? Subtract cost from benefit then add future resale value of property.