4 ms·

It would help a lot of people, but it also hurts a lot of people with mortgage. Liberalizing zoning and implementing LVT would help, but it would means massive

by kiba 5y ago

It would help a lot of people, but it also hurts a lot of people with mortgage. Liberalizing zoning and implementing LVT would help, but it would means massive structural change in our society. It's a true fix, but that true fix requires that we have important and difficult conversations about said structural changes.

davidw 5y ago
It's not going to hurt owners that much, really, not those in it for the long haul. It's unlikely that in a liberalized market, all else being equal, prices would truly crater, as builders would pull back. You'd probably get something more like Germany has been, where prices are fairly stable and boring, rather than an exciting market to speculate in.
epistasis 5y ago
People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further. This is a huge drain on the economic productivity of the younger generations, and anybody who was not able to afford to buy in to the scheme before the recent climbs. It's time to make housing behave at most like a savings account, rather than an investment account.
- davidw 5y ago
  Exactly. > This is a huge drain on the economic productivity of the younger generations Economists have attempted to quantify the effects of this, and the numbers are huge: https://www.aeaweb.org/articles?id=10.1257/mac.20170388 https://www.aeaweb.org/articles?id=10.1257/mac.20170388
- Marsymars 5y ago
  > People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further. Depends on jurisdiction. Canada's housing market has most of the same problems as the US's, but you can't really lock in low interest rates for longer than five years - so if you raise interest rates, you leave people five years from now underwater and having to renew for the next two decades at high rates.
commandlinefan 5y ago
> hurts a lot of people with mortgage How so? The only downside (for people who already own a house) I can see of building more housing is that prices wouldn't rise as much as they historically have. AFAICT rising house prices only benefit real estate speculators, not actual homeowners who live in the house - my taxes are a percentage of the appraised value of the house, and they go up every year to the point where I'm starting to wonder if I'll be able to afford them in 10 years. I can't really "cash out" the value I have in the house either - or I could, but then I'd have to buy another house to live in at the same inflated prices.
- davidw 5y ago
  In something that I'm sure is entirely a coincidence, states with raging housing crisis like California and Oregon limit the amount taxes can go up every year, so that homeowners see a lot of benefits and fewer direct costs of the rising prices.
  - commandlinefan 5y ago
    Texas limits the increases to 10% per year. And it goes up by the full 10% every year. 10% every year for just 5 years is a 61% increase. Compound interest hurts taxpayers the same way it helps investors.
    - davidw 5y ago
      10% is a lot healthier than Oregon's 3%.
      - loco5niner 5y ago
        Yikes! You're wanting to raise my monthly payment by $170 per month after 5 years. I saved for years to buy a house so I would have a stable platform for raising a family, not to get rich. It sounds like you're just wanting to punish people who saved their money and put it in a wise investment, when actually, that's what everyone should be doing.
rastapasta42 5y ago
> It would help a lot of people, but it also hurts a lot of people with mortgage. My buddy's dad owns 20 properties, preventing younger generations from owning a place for themselves. Just imagine how much value and how many jobs he could've created by investing that money into manufacturing instead of increasing rents and making younger people's lives more miserable.

by kiba 5y ago

davidw 5y ago

It's not going to hurt owners that much, really, not those in it for the long haul. It's unlikely that in a liberalized market, all else being equal, prices would truly crater, as builders would pull back. You'd probably get something more like Germany has been, where prices are fairly stable and boring, rather than an exciting market to speculate in.

epistasis 5y ago

People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further. This is a huge drain on the economic productivity of the younger generations, and anybody who was not able to afford to buy in to the scheme before the recent climbs. It's time to make housing behave at most like a savings account, rather than an investment account.

davidw 5y ago
Exactly. > This is a huge drain on the economic productivity of the younger generations Economists have attempted to quantify the effects of this, and the numbers are huge: https://www.aeaweb.org/articles?id=10.1257/mac.20170388 https://www.aeaweb.org/articles?id=10.1257/mac.20170388
Marsymars 5y ago
> People with mortgages have been making out like bandits for decades, and have recently locked in historically low interest rates that leverage their economic gains even further. Depends on jurisdiction. Canada's housing market has most of the same problems as the US's, but you can't really lock in low interest rates for longer than five years - so if you raise interest rates, you leave people five years from now underwater and having to renew for the next two decades at high rates.

commandlinefan 5y ago

> hurts a lot of people with mortgage How so? The only downside (for people who already own a house) I can see of building more housing is that prices wouldn't rise as much as they historically have. AFAICT rising house prices only benefit real estate speculators, not actual homeowners who live in the house - my taxes are a percentage of the appraised value of the house, and they go up every year to the point where I'm starting to wonder if I'll be able to afford them in 10 years. I can't really "cash out" the value I have in the house either - or I could, but then I'd have to buy another house to live in at the same inflated prices.

davidw 5y ago
In something that I'm sure is entirely a coincidence, states with raging housing crisis like California and Oregon limit the amount taxes can go up every year, so that homeowners see a lot of benefits and fewer direct costs of the rising prices.
- commandlinefan 5y ago
  Texas limits the increases to 10% per year. And it goes up by the full 10% every year. 10% every year for just 5 years is a 61% increase. Compound interest hurts taxpayers the same way it helps investors.
  - davidw 5y ago
    10% is a lot healthier than Oregon's 3%.
    - loco5niner 5y ago
      Yikes! You're wanting to raise my monthly payment by $170 per month after 5 years. I saved for years to buy a house so I would have a stable platform for raising a family, not to get rich. It sounds like you're just wanting to punish people who saved their money and put it in a wise investment, when actually, that's what everyone should be doing.

rastapasta42 5y ago

> It would help a lot of people, but it also hurts a lot of people with mortgage. My buddy's dad owns 20 properties, preventing younger generations from owning a place for themselves. Just imagine how much value and how many jobs he could've created by investing that money into manufacturing instead of increasing rents and making younger people's lives more miserable.