5 ms·

The whole model of housing is broken in most countries,including the US. It's interesting that entire economies are willing to subsidise food to make it as avai

The whole model of housing is broken in most countries,including the US. It's interesting that entire economies are willing to subsidise food to make it as available as possible, but the second most important thing in human life-shelter,is completely overlooked. I'm not arguing that everybody should live in large mansions free of charge, however the fact that people who work do struggle to keep roof over their heads either via rent or mortgages is absurd. Also,how society deals with periods of uncertainty,or difficulty. For instance someone takes a mortgage for 30 years period and then ends up having some temporary hiccups on year 5 that can be resolved in a few months ( i.e. unemployment). So instead of saying something like: 'ok, you are having difficult times,which is li ke 1% of the entire period,so you'll simply have to pay this longer', we say: 'tough luck, get out!'.

willj 6y ago
And in fact, by the Rule of Threes [1], depending on where you are, housing is more important than food and water. [1] https://en.m.wikipedia.org/wiki/Rule_of_threes_(survival) https://en.m.wikipedia.org/wiki/Rule_of_threes_(survival)
nkrisc 6y ago
I always wondered: is it really cheaper for a bank to repossess a house than it is to pause payments for a few months? Or are they just so skittish that they're not willing to take any chance of non-payment longer than, say, a few months?
corebit 6y ago
We've tried free and low cost housing for decades in the US and its been a disaster every single time. Every. Single. Time.
- cosmodisk 6y ago
  So called social housing wasn't a huge success in other countries either. However the failures aren't because of the housing per se. What a lot of those schemes did, was simply getting a large piece of land and building large, soulless housing estates and filling them with often poor people with a lot of challenges.And then everyone says: OK, this isn't working. But housing is only a part of the equation: the location, access to education,work,and health services. How dangerous and antisocial behaviour isdealt with in such estates.Can people be simply kicked out for poor behaviour instead of semi tolerated for years?
- nine_zeros 6y ago
  Why is this the only other option? How about removing rent controls and other regulations around building smaller low cost units and then charging a 15% vacancy tax on any unit that is empty for 3 months? This way we are increasing supply and not encouraging hoarding.
  - inetsee 6y ago
    "regulations around building smaller low cost units"; I think this is a fundamental problem for dealing with low cost housing issues. Many cities have building regulations mandating minimum sizes for apartments, and requirements for a minimum number of parking spaces, even for apartment complexes close to public transportation. This makes it impossible for builders to build low cost housing. The problem of low cost housing has been around for a long time; the pandemic is just making it a much bigger problem. Unfortunately, building an apartment complex takes time, and if the pandemic crisis is resolved (for some definition of resolved) in a year or 18 months, the low cost housing problem will just go back to what it was before the pandemic.
    - danaris 6y ago
      I mean, to some extent, what you're saying is, "Cities require apartments to be better than prison cells, and it's hard to make massive profits making genuinely livable housing that can be provided to people who don't make much money." Which...yeah, the purpose of low-income housing should be to provide housing that people can still thrive in, no matter their income, not to make massive profits for the real estate or construction companies. The cities themselves should be footing the bill to make sure their people are well-cared-for. It's already been proven in multiple instances to cost less than dealing with homelessness and its consequences, even if the people they're providing housing for can't pay a single cent (at first).
csomar 6y ago
> that can be resolved in a few months I'm not sure about the US but I think you are not kicked out from the first day / first month. For auto-leases, the bank might wait a couple months max; but for houses it's usually negotiable with the bank. For the bank, it's a lengthy process that requires selling the house to recover their capital. It's not something they want to go through unless the economy is super strong and they can sell the house really fast. Right now, it might be hard to 1. sell the house fast and 2. sell the house at a good enough price to recover their capital. If you are only a few months away from a job you should be able to negotiate but my guess is that some (many?) people shouldn't have gotten into these loans in the first place.
- madengr 6y ago
  Lets say you are $150k into a $200k mortgage, then default. What prevents the bank from selling it at $50k, which is just enough to recover their principle?
  - cableshaft 6y ago
    Good question. I assumed that's how foreclosures work, and why you can get such good prices on them.
    - csomar 6y ago
      You get lower than market prices but there are some catches: The foreclosure is a long process because they need to wait for the highest bidder, you need to deposit something like 1/3 of the house price, you need to pay some other fees, etc...
  - csomar 6y ago
    Nothing, in fact the bank might actually make more profits from fees (and they collect the interest in advance). So while you might get away with a few months of delinquencies, it's not a situation you might even want to be in.
  - voisin 6y ago
dariusj18 6y ago
Many banks have mortgage forbearance, they recognize that life happens. Unfortunately it's not uniform, some will tack it on at the end, others will require any missed payments to be payed at the end of the forbearance. Additionally the US does have housing programs[1], so I wouldn't call it "completely" overlooked. [1] https://www.hud.gov/topics/rental_assistance https://www.hud.gov/topics/rental_assistance
dennis_jeeves 6y ago
>The whole model of housing is broken in most countries,including the US. Broken? Well, as with many things, the problem is that there is a model to start with. No civilized society in my view should have income or property tax. (for the record there are no civilized societies by that definition). In a country with plenty of land, land zoning/restriction should be the bare minimum. The collective human enterprise is messed up beyond belief.
deleted 6y ago
[deleted]

willj 6y ago

And in fact, by the Rule of Threes [1], depending on where you are, housing is more important than food and water. [1] https://en.m.wikipedia.org/wiki/Rule_of_threes_(survival) https://en.m.wikipedia.org/wiki/Rule_of_threes_(survival)

nkrisc 6y ago

I always wondered: is it really cheaper for a bank to repossess a house than it is to pause payments for a few months? Or are they just so skittish that they're not willing to take any chance of non-payment longer than, say, a few months?

corebit 6y ago

We've tried free and low cost housing for decades in the US and its been a disaster every single time. Every. Single. Time.

cosmodisk 6y ago
So called social housing wasn't a huge success in other countries either. However the failures aren't because of the housing per se. What a lot of those schemes did, was simply getting a large piece of land and building large, soulless housing estates and filling them with often poor people with a lot of challenges.And then everyone says: OK, this isn't working. But housing is only a part of the equation: the location, access to education,work,and health services. How dangerous and antisocial behaviour isdealt with in such estates.Can people be simply kicked out for poor behaviour instead of semi tolerated for years?
nine_zeros 6y ago
Why is this the only other option? How about removing rent controls and other regulations around building smaller low cost units and then charging a 15% vacancy tax on any unit that is empty for 3 months? This way we are increasing supply and not encouraging hoarding.
- inetsee 6y ago
  "regulations around building smaller low cost units"; I think this is a fundamental problem for dealing with low cost housing issues. Many cities have building regulations mandating minimum sizes for apartments, and requirements for a minimum number of parking spaces, even for apartment complexes close to public transportation. This makes it impossible for builders to build low cost housing. The problem of low cost housing has been around for a long time; the pandemic is just making it a much bigger problem. Unfortunately, building an apartment complex takes time, and if the pandemic crisis is resolved (for some definition of resolved) in a year or 18 months, the low cost housing problem will just go back to what it was before the pandemic.
  - danaris 6y ago
    I mean, to some extent, what you're saying is, "Cities require apartments to be better than prison cells, and it's hard to make massive profits making genuinely livable housing that can be provided to people who don't make much money." Which...yeah, the purpose of low-income housing should be to provide housing that people can still thrive in, no matter their income, not to make massive profits for the real estate or construction companies. The cities themselves should be footing the bill to make sure their people are well-cared-for. It's already been proven in multiple instances to cost less than dealing with homelessness and its consequences, even if the people they're providing housing for can't pay a single cent (at first).

csomar 6y ago

> that can be resolved in a few months I'm not sure about the US but I think you are not kicked out from the first day / first month. For auto-leases, the bank might wait a couple months max; but for houses it's usually negotiable with the bank. For the bank, it's a lengthy process that requires selling the house to recover their capital. It's not something they want to go through unless the economy is super strong and they can sell the house really fast. Right now, it might be hard to 1. sell the house fast and 2. sell the house at a good enough price to recover their capital. If you are only a few months away from a job you should be able to negotiate but my guess is that some (many?) people shouldn't have gotten into these loans in the first place.

madengr 6y ago
Lets say you are $150k into a $200k mortgage, then default. What prevents the bank from selling it at $50k, which is just enough to recover their principle?
- cableshaft 6y ago
  Good question. I assumed that's how foreclosures work, and why you can get such good prices on them.
  - csomar 6y ago
    You get lower than market prices but there are some catches: The foreclosure is a long process because they need to wait for the highest bidder, you need to deposit something like 1/3 of the house price, you need to pay some other fees, etc...
- csomar 6y ago
  Nothing, in fact the bank might actually make more profits from fees (and they collect the interest in advance). So while you might get away with a few months of delinquencies, it's not a situation you might even want to be in.
- voisin 6y ago

dariusj18 6y ago

Many banks have mortgage forbearance, they recognize that life happens. Unfortunately it's not uniform, some will tack it on at the end, others will require any missed payments to be payed at the end of the forbearance. Additionally the US does have housing programs[1], so I wouldn't call it "completely" overlooked. [1] https://www.hud.gov/topics/rental_assistance https://www.hud.gov/topics/rental_assistance

dennis_jeeves 6y ago

>The whole model of housing is broken in most countries,including the US. Broken? Well, as with many things, the problem is that there is a model to start with. No civilized society in my view should have income or property tax. (for the record there are no civilized societies by that definition). In a country with plenty of land, land zoning/restriction should be the bare minimum. The collective human enterprise is messed up beyond belief.

deleted 6y ago

[deleted]