5 ms·
Does inflation include rent? If inflation goes up then my landlord will have to pay more for his potatoes. My landlord’s sole source of income is the rent I p
by gorgoiler 4y ago
Does inflation include rent? If inflation goes up then my landlord will have to pay more for his potatoes. My landlord’s sole source of income is the rent I pay him. Does that mean I have to pay more rent, so he can afford his potatoes?
The cost of potatoes goes up for me as well. So am I being hit twice by the potato price hike — once for me and then again for my landlord?
In a fair world, renting a property is paying for the right to live somewhere and nothing more, but I feel like in the unfair world landlords feel entitled to rent as an income stream and as such when the potato price goes up they will ask for a “pay raise” (rent rise) to cover it.
- DoktorDelta 4y agoTurns out, our landlords are also living paycheck-to-paycheck, just not their paycheck
- adolph 4y agoAre we all not the paycheck of others and they our own paycheck?
- maest 4y agoBy that logic, when you pay for potato, you also pay for the gas used to transport the potatos. But you already pay for gas when you drive around, so you're getting hit by inflation twice.
- redorb 4y agoYour paying for the right to live there. What the money you pay is used for is none of your business. I find it a lot healthier to not worry about the money after I spend it, it's no longer mine for I have agreed to trade it away.
- throwaway0a5e 4y agoIt's not worth worrying about but it's worth caring about IMO. Buying a sandwich from a sandwich shop who's landlord will likely donate to politicians that want to make your life suck is the smaller stakes but closer to home version of nations buying oil that funds people who hate them.
- hackerlight 4y agoThis libertarian worldview is only coherent for goods like food or computers, where the quality and safety of supply is regulated but the quantity of supply isn't. Property is a whole other ball game. In every market economy you see tremendous capture of government by landlords. They rig the game by constraining supply. The free choice worldview breaks down given that shelter is a necessity, and the only place I can get it from is this cartel that has 2x-ed the price of the good via their capture of government. That delta in price is theft facilitated by government force, masquerading as a free transaction between consenting parties. Libertarians are supposed to be against regulatory capture and crony capitalism, and the property market is like a textbook example of this kind of depraved capture of government by special interests.
- dane-pgp 4y agoWell said, but it's interesting that you contrast "goods like food" with "shelter", suggesting that only the latter "is a necessity". That doesn't invalidate your point, but I think it requires a more subtle argument than if you had given a different example like maybe transport.
- hackerlight 4y agoYou're right that it needs to be fleshed out more subtly. I think the main point is that government constraints on supply is theft, whenever those constraints are applied onto an entire market with no good substitute. Not theft as understood in a current legal sense, but functionally equivalent. The interest group (landlords, steelmakers) are stealing from customers (renters, builders) by lobbying government for supply constraints (zoning laws, steel tarrifs). The mechanism of theft is artificially higher prices paid by the consumer, with no way out given an absence of substitutes. Whether the good is a necessity or not is somewhat moot to the question of whether theft is occurring. Even if I buy unnecessary gym equipment, I am still being robbed if the price is 2x higher due to government corruption. It is more pernicious when the good is a necessity, like shelter, though, because the theft becomes mandatory.
- kergonath 4y ago> Your paying for the right to live there. What the money you pay is used for is none of your business. Sure. The moment smug Tory landlords stop nagging me about the price of avocado toast.
- zmgsabst 4y agoJust wait until you find out your internet bill has a potato surcharge because their engineers need to buy potatoes too.
- gorgoiler 4y agoBut I don’t mind that — it’s the asset owners pretending they are workers that I mind. I suspect I just hate renting / landlords, and it’s nothing more complex than that.
- mutatio 4y agoIf something goes wrong with a property, the landlord foots the bill, right now construction costs are out pacing inflation.
- claudiawerner 4y agoThat's a very big 'if', yet no matter how small or big that potential/risk is, I'm still expected to pay the same amount for his potatoes just in case something goes wrong? And even then, many landlords will try and blame you and take it out of your deposite!
- mutatio 4y agoIn the UK deposits are protected, disputes favour the tenant.
- stemlord 4y agoAre you trying to justify wildly overinflated rents with meager or uncommon repair costs?
- mutatio 4y agoCorrecting a false statement. There are risks with property and being a landlord.
- 4y ago
- spywaregorilla 4y ago> Does inflation include rent? Inflation is measured by the changing price of several things. Yes, rent is one of them.
- dazc 4y agoSadly, there are some landlords who do feel entitled to be making a living from renting out a single house. OK, this may be an extreme but it pretty much sums up the parasitic nature of our dysfunctional housing market.
- sfg 4y agoHe can't charge more unless someone will pay it. It doesn't matter what he feels entitled to. It is just supply and demand. Like many others during such inflationary periods, he might simply end up with less purchasing power.
- bitshiftfaced 4y agoIf people would be willing to pay 100x the current cost of rent, then your landlord would charge that much. It's based on how much people are willing to pay, not on the landlord's living standards.
- roflyear 4y agoWrt rent, what other options do people have? Living on the street?
- kergonath 4y agoCouncil homes, for the most part. Still rent, but (usually) much lower, with very different conditions, and the money does not go to private landlords.
- substation13 4y agoThere are nowhere near enough council houses for this to be an option for most people, and to qualify you need a painfully low income.
- kergonath 4y agoIndeed. But it is one of the options between renting and sleeping under a bridge.
- s1artibartfast 4y agoIn theory, 100x housing prices would spur more building. Lowering the price. In reality, building is constrained for a multitude of reasons
- mihaigalos 4y agoYou could change cities, countries, continents. Yes, the prices are rising everywhere but rents in i.e. eastern Europe are 3-5x lower than in the west.
- 4y ago
- tsss 4y ago"you" personally: probably yes. "you" as in everyone: probably no, over the long term. Rent is more or less always the maximum that buyers can afford because it is an inflexible good where supply can not be easily increased (in fact it is decreasing despite the shortages). But it can take a long long time until the market forces take effect.
- jerf 4y agoWhile you can understand inflation that way, that strikes me as trying to figure out the forest by studying a single tree. Better to look up the treatment of it as the interaction of money supply and money velocity. I'm not saying this is a complete picture either, it's only the beginning of the process, but it's probably a better starting point than trying to start at something so micro and trying to work your way up to macro. Such a path is theoretically possible but long and filled with peril.
- throwawaymaths 4y agoIt's not "being hit twice", though. Inflation is a change, so if you're already paying for a and b, and both a and b go up 10% then a + b goes 10%, not 20%.