4 ms·

Maybe they’re promoting productive investments in real estate, while punishing people for rent seeking off of companies just because they fronted the capital.

bpodgursky 5y ago
You know that most real estate investing is like... buying land and extracting literal rent, right? This is a bizarre take.
- sokoloff 5y ago
  Though they do literally seek rent from their tenants, landlords who provide housing (or commercial real-estate) are not rent-seeking in the economic sense of that phrase, which is to seek to improve your economic position without creating any benefits for others. Providing housing or office space is clearly creating benefit for others.
  - whydoibother 5y ago
    No, they don't. Landlords are complete drains on society. They don't 'provide' housing. They limit supply and drive up costs for everyone else.
    - sokoloff 5y ago
      For multiple periods spanning over two decades in my life, I greatly appreciated the opportunity to live indoors without having to first purchase a house or apartment where I wanted to live.
      - whydoibother 5y ago
        That is possible without landlords. Gov't provided housing, for instance.
        vineyardmike 5y ago
        I greatly appreciate not needing to live in govt housing without buying a house.
        whydoibother 5y ago
        I am assuming you are basing this off the failed and racist public housing that has existed in America. There are better ways though, I assure you.
    - AnimalMuppet 5y ago
      I have a house. I rent out the house. How am I limiting supply?
      - whydoibother 5y ago
        It is one less house people can buy.
        AnimalMuppet 5y ago
        And one more they can rent. If I buy a house, don't live in it, and don't rent it, that's limiting supply.
        whydoibother 5y ago
        It is one more house they won't be able to buy and build equity with. Meanwhile, they will have to pay more than what the mortgage is to rent (you are extracting some kind of profit, after all) and have nothing to show for it at the end.
        AnimalMuppet 5y ago
        By that logic, if I buy a house and live in it, I'm also constraining supply, because it's one more house someone else won't be able to buy. And, sure, it's true, in a nitpicky kind of way; they won't be able to buy it. It's also so absurd that your definition of "constraining supply" is clearly useless.
  - bpodgursky 5y ago
    This is sort of an unreal conversation to be having. If you buy a house to speculate on housing prices, and then rent it out, _you aren't adding anything_. That's entire point of the phrase "rent seeking". You've dumped capital into a limited-quantity good and then extract rent as it becomes more valuable. The only exception is those actually expanding the housing supply (which is hugely valuable and should be rewarded!), but this is a tiny tiny fraction of the housing stock! Most commercial real-estate is not any housing-add over if they didn't exist!
    - vineyardmike 5y ago
      It is true that speculative housing ownership does this, but the flip side is that many people can't actually afford a house (but can afford rent, eg. due to down payment costs), or don't want to own (moves cities often). In larger multi-tenant buildings, the average person wouldn't buy, and the landlord provides services, like maintenance (and sometimes in gyms/etc in higher end buildings). Sure those services can be purchased on the free market anyways, but bundling is pretty common in business.
    - procombo 5y ago
      Where I'm at they can't build houses fast enough. Overall it's a bad market because home owner's are more motived to borrow against their property value (heloc, etc) than move. And everyone else is kinda stuck. I own several rental units. Only freestanding homes. I definitely see myself as providing a value add. I fix things when they break, provide landscaping, provide housing to great people with not-great credit. They don't have to worry about a bunch of different utility bills. All value adds. And I take on plenty of risk where lenders don't want to. I don't get compensated all too well for it either. It's a very active way of investing long term, you may not see the value of, but it's definitely there. I could easily charge 40% more in rent right now, as could many.
    - hahaxdxd123 5y ago
      Insane that you've been downvoted for this. Land value capture is literally THE example of economic rent. Adam Smith identified it in a little book called Wealth of Nations...
- bestcoder69 5y ago
  My take is you haven’t shown a distinction that makes me care either way. More capital income from the wealthiest people comes from equity so it makes more sense as a target for taxes, assuming we want to tax the top more and the middle less.

bpodgursky 5y ago

You know that most real estate investing is like... buying land and extracting literal rent, right? This is a bizarre take.

sokoloff 5y ago
Though they do literally seek rent from their tenants, landlords who provide housing (or commercial real-estate) are not rent-seeking in the economic sense of that phrase, which is to seek to improve your economic position without creating any benefits for others. Providing housing or office space is clearly creating benefit for others.
- whydoibother 5y ago
  No, they don't. Landlords are complete drains on society. They don't 'provide' housing. They limit supply and drive up costs for everyone else.
  - sokoloff 5y ago
    For multiple periods spanning over two decades in my life, I greatly appreciated the opportunity to live indoors without having to first purchase a house or apartment where I wanted to live.
    - whydoibother 5y ago
      That is possible without landlords. Gov't provided housing, for instance.
      - vineyardmike 5y ago
        I greatly appreciate not needing to live in govt housing without buying a house.
        whydoibother 5y ago
        I am assuming you are basing this off the failed and racist public housing that has existed in America. There are better ways though, I assure you.
  - AnimalMuppet 5y ago
    I have a house. I rent out the house. How am I limiting supply?
    - whydoibother 5y ago
      It is one less house people can buy.
      - AnimalMuppet 5y ago
        And one more they can rent. If I buy a house, don't live in it, and don't rent it, that's limiting supply.
        whydoibother 5y ago
        It is one more house they won't be able to buy and build equity with. Meanwhile, they will have to pay more than what the mortgage is to rent (you are extracting some kind of profit, after all) and have nothing to show for it at the end.
        AnimalMuppet 5y ago
        By that logic, if I buy a house and live in it, I'm also constraining supply, because it's one more house someone else won't be able to buy. And, sure, it's true, in a nitpicky kind of way; they won't be able to buy it. It's also so absurd that your definition of "constraining supply" is clearly useless.
- bpodgursky 5y ago
  This is sort of an unreal conversation to be having. If you buy a house to speculate on housing prices, and then rent it out, _you aren't adding anything_. That's entire point of the phrase "rent seeking". You've dumped capital into a limited-quantity good and then extract rent as it becomes more valuable. The only exception is those actually expanding the housing supply (which is hugely valuable and should be rewarded!), but this is a tiny tiny fraction of the housing stock! Most commercial real-estate is not any housing-add over if they didn't exist!
  - vineyardmike 5y ago
    It is true that speculative housing ownership does this, but the flip side is that many people can't actually afford a house (but can afford rent, eg. due to down payment costs), or don't want to own (moves cities often). In larger multi-tenant buildings, the average person wouldn't buy, and the landlord provides services, like maintenance (and sometimes in gyms/etc in higher end buildings). Sure those services can be purchased on the free market anyways, but bundling is pretty common in business.
  - procombo 5y ago
    Where I'm at they can't build houses fast enough. Overall it's a bad market because home owner's are more motived to borrow against their property value (heloc, etc) than move. And everyone else is kinda stuck. I own several rental units. Only freestanding homes. I definitely see myself as providing a value add. I fix things when they break, provide landscaping, provide housing to great people with not-great credit. They don't have to worry about a bunch of different utility bills. All value adds. And I take on plenty of risk where lenders don't want to. I don't get compensated all too well for it either. It's a very active way of investing long term, you may not see the value of, but it's definitely there. I could easily charge 40% more in rent right now, as could many.
  - hahaxdxd123 5y ago
    Insane that you've been downvoted for this. Land value capture is literally THE example of economic rent. Adam Smith identified it in a little book called Wealth of Nations...
bestcoder69 5y ago
My take is you haven’t shown a distinction that makes me care either way. More capital income from the wealthiest people comes from equity so it makes more sense as a target for taxes, assuming we want to tax the top more and the middle less.