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> growing the permanent rental class means eliminating access to the only vehicle for building wealth This is a policy choice, and I would argue it's a bad ch
by aluminum96 5y ago
> growing the permanent rental class means eliminating access to the only vehicle for building wealth
This is a policy choice, and I would argue it's a bad choice. If we strive to make housing cheaper across the board, households will have more money available to save and invest by other means.
In particular, the incentives created by housing as an appreciating investment are awful. Owners who have all their money locked up in home equity are incentivized to oppose new development, creating an artificial housing shortage.
As a counterexample, consider Germany: virtually all households rent, housing stock is plentiful and affordable, and the middle class is still able to save and build wealth.
- mensetmanusman 5y agoI wish our wealth building was in the form of production machines that families maintain through investment.
- zepto 5y agoWhat do you mean by “ production machines”?
- dodobirdlord 5y agoPresumably investing by buying stock in companies that are economically productive, as opposed to engaging in purely speculative investment like owning land.
- nitrogen 5y agoProbably cottage industry. A machine shop or clothing line in every garage.
- teakettle42 5y agoIsn't Germany experiencing a housing shortage — and soaring rents — in their major cities? That aside, I'm not convinced that encouraging home ownership is bad policy. Home ownership is a direct personal investment in your community, a means of securing one's most base human needs. If people are not building equity in their own homes, someone else is — why is that a superior outcome?
- s17n 5y agoBuilding wealth via housing isn't about savings, it's about leverage.