4 ms·

> if they increase supply so much that housing prices fall, a lot of people will be upside down on their mortgages That doesn't make the house any less suitabl

> if they increase supply so much that housing prices fall, a lot of people will be upside down on their mortgages That doesn't make the house any less suitable to live in. You're still paying exactly the same price for exactly the same house. The only people that will hurt are those who have gotten a mortgage on a property, rented it out to someone, used that rent as leverage to get another mortgage, rented that out to, and so on, and those people are all absolute scum directly contributing to mass homelessness and a generation who can't afford their own roof to sleep under, so I have absolutely no sympathy for any of them. Not a hugely tenable position politically, but I can't pretend to give a toss about someone who profits off of contributing absolutely nothing to society undergoing the same hardship they've caused their fellow citizens for the past several decades.

jelliclesfarm 6y ago
property rights is the basis of capitalism. the whole machine hums because there is an exchange of property, goods, services and money in a free market. housing property is an immovable illiquid asset. it is not only an asset but it is also a speculative asset. unaffordable property prices often benefit the governments more than property owners because its one way to extract hefty property taxes. so the only way to balance interest rates is to keep inflating the value of the homes. its like a ponzi scheme. this usually happens where social programs are disproportionately shouldered by a narrow slice of productive earners vs a broader section of people who are benefit more from social programs than contributing to it..aka negative tax. imagine it like an inverted triangle/pyramid. however, the solution to affordable housing is to build more affordable rental units. not create more home owners. if people can only buy the cheapest properties, how will they maintain it, pay interest on mortgage and pay property taxes? they are better off renting. why govts tries to create more home owners is the reason i mentioned above. to generate more property taxes. the people who suffer most are the bottom most in the socio economic scale. home ownership is not for everyone. the saddest part is that they have them convinced that its a form of credit line and that ends up making it an even more potent speculative asset. throw in foreign investments in residential speculative housing market, it overheats. which will only make housing even more unaffordable. its a vicious cycle.
- deleted 6y ago
  [deleted]
- dzhiurgis 6y ago
  > build more affordable rental units Try saying that to r/NZ
  - jelliclesfarm 6y ago
    I feel the govt should build market rate affordable homes. Singapore does this. Germany doesn’t have an affordable housing issue. Most people rent. My mother worked along with slum clearance board to build homes for low, middle and high income families by creating new townships. There are plenty of success stories.
  - jelliclesfarm 6y ago
    In SF Bay Area, we have spent over 350 million dollars in just one year providing ‘outreach’ to homeless people. That’s just for one year. The money would have been well spent creating employment, building rehab, mental health facilities and groups homes/homes for the unhoused.
- gnat 6y ago
  Speculation is a choice, not a necessity. Investors make that choice, knowing that governments will choose whether or not to support it. Your economic reductionism is blind to political realities: a government that implements unpopular policies will most likely be voted out. Governments don't just create more home owners to generate more property taxes, they create more home owners when enough voters want to become home owners. You say "home ownership is not for everyone" as though that blesses the status quo as some kind of natural permanent state. Home ownership is for those who can afford it. A reduction in prices (lower construction costs, greater supply, etc.) increases home affordability, which increases home ownership. Yes, it may never be for everyone, but equally it can be for more people.
  - jelliclesfarm 6y ago
    Pension funds speculate on Wall Street. It’s all connected. I am just saying that ..at least in the Bay Area..there is an incentive for the govt to keep home prices high. Increase in home ownership doesn’t address affordable housing. It only addresses more tax collection and it also increases debt. People can be housed if there are rental units. And yet that never happens in the Bay Area. Just talking about my zip code. And it seems to me that it’s by design.
afarviral 6y ago
As someone who just bought a 65sqm Unit (semi-detached) in a poor neighborhood near a city for half a million (first home) I'd be happy to see house prices drop... it will screw us in terms of a return on the investment but I can see past my greed. I feel tremendously privileged to be where I'm at and it shouldnt be such a privilege; your average income earner deserves this and better.
WalterBright 6y ago
Since those homes are rented out, how does that contribute to homelessness? Whether the owners live in them or renters, they are occupied.
- indigochill 6y ago
  Probably because when someone takes out a mortgage and then rents the property, it's with the expectation that the rent will offset the mortgage. Therefore the rent costs more than it actually costs to live there as an owner because of the landlord's markup. Meaning fewer people can afford to live there.
  - edogg 6y ago
    The cost of the property reflects the value of the rents, the cost of financing, property taxes and maintenance. Rents are probably not that out of wack with the landlords costs. If the landlords revenue does exceed costs you could see it as either money the landlord needs to save for future major repairs like new roof, new appliances, payment for their labour, return on the down payment invested, etc. if you can’t beat them join them and if you can’t join them then maybe it isn’t quite so easy and cut and dry.
  - WalterBright 6y ago
    But yet the same number of people are housed.
- sellyme 6y ago
  Because they're opposing the building of new cheap housing as it will decrease the value of their investment. Additionally, artificially raising the price in this way will increase the amount of time for which the property is not occupied, but that's a relatively minor effect in comparison to the above.

jelliclesfarm 6y ago

property rights is the basis of capitalism. the whole machine hums because there is an exchange of property, goods, services and money in a free market. housing property is an immovable illiquid asset. it is not only an asset but it is also a speculative asset. unaffordable property prices often benefit the governments more than property owners because its one way to extract hefty property taxes. so the only way to balance interest rates is to keep inflating the value of the homes. its like a ponzi scheme. this usually happens where social programs are disproportionately shouldered by a narrow slice of productive earners vs a broader section of people who are benefit more from social programs than contributing to it..aka negative tax. imagine it like an inverted triangle/pyramid. however, the solution to affordable housing is to build more affordable rental units. not create more home owners. if people can only buy the cheapest properties, how will they maintain it, pay interest on mortgage and pay property taxes? they are better off renting. why govts tries to create more home owners is the reason i mentioned above. to generate more property taxes. the people who suffer most are the bottom most in the socio economic scale. home ownership is not for everyone. the saddest part is that they have them convinced that its a form of credit line and that ends up making it an even more potent speculative asset. throw in foreign investments in residential speculative housing market, it overheats. which will only make housing even more unaffordable. its a vicious cycle.

deleted 6y ago
[deleted]
dzhiurgis 6y ago
> build more affordable rental units Try saying that to r/NZ
- jelliclesfarm 6y ago
  I feel the govt should build market rate affordable homes. Singapore does this. Germany doesn’t have an affordable housing issue. Most people rent. My mother worked along with slum clearance board to build homes for low, middle and high income families by creating new townships. There are plenty of success stories.
- jelliclesfarm 6y ago
  In SF Bay Area, we have spent over 350 million dollars in just one year providing ‘outreach’ to homeless people. That’s just for one year. The money would have been well spent creating employment, building rehab, mental health facilities and groups homes/homes for the unhoused.
gnat 6y ago
Speculation is a choice, not a necessity. Investors make that choice, knowing that governments will choose whether or not to support it. Your economic reductionism is blind to political realities: a government that implements unpopular policies will most likely be voted out. Governments don't just create more home owners to generate more property taxes, they create more home owners when enough voters want to become home owners. You say "home ownership is not for everyone" as though that blesses the status quo as some kind of natural permanent state. Home ownership is for those who can afford it. A reduction in prices (lower construction costs, greater supply, etc.) increases home affordability, which increases home ownership. Yes, it may never be for everyone, but equally it can be for more people.
- jelliclesfarm 6y ago
  Pension funds speculate on Wall Street. It’s all connected. I am just saying that ..at least in the Bay Area..there is an incentive for the govt to keep home prices high. Increase in home ownership doesn’t address affordable housing. It only addresses more tax collection and it also increases debt. People can be housed if there are rental units. And yet that never happens in the Bay Area. Just talking about my zip code. And it seems to me that it’s by design.

afarviral 6y ago

As someone who just bought a 65sqm Unit (semi-detached) in a poor neighborhood near a city for half a million (first home) I'd be happy to see house prices drop... it will screw us in terms of a return on the investment but I can see past my greed. I feel tremendously privileged to be where I'm at and it shouldnt be such a privilege; your average income earner deserves this and better.

WalterBright 6y ago

Since those homes are rented out, how does that contribute to homelessness? Whether the owners live in them or renters, they are occupied.

indigochill 6y ago
Probably because when someone takes out a mortgage and then rents the property, it's with the expectation that the rent will offset the mortgage. Therefore the rent costs more than it actually costs to live there as an owner because of the landlord's markup. Meaning fewer people can afford to live there.
- edogg 6y ago
  The cost of the property reflects the value of the rents, the cost of financing, property taxes and maintenance. Rents are probably not that out of wack with the landlords costs. If the landlords revenue does exceed costs you could see it as either money the landlord needs to save for future major repairs like new roof, new appliances, payment for their labour, return on the down payment invested, etc. if you can’t beat them join them and if you can’t join them then maybe it isn’t quite so easy and cut and dry.
- WalterBright 6y ago
  But yet the same number of people are housed.
sellyme 6y ago
Because they're opposing the building of new cheap housing as it will decrease the value of their investment. Additionally, artificially raising the price in this way will increase the amount of time for which the property is not occupied, but that's a relatively minor effect in comparison to the above.