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We desperately need a ban on real estate being used as an investment vehicle. This isn't a game. We all need a place to live. We all share this planet. We won

We desperately need a ban on real estate being used as an investment vehicle. This isn't a game. We all need a place to live. We all share this planet. We won't be able to do that anymore when all of the habitable land is owned by the 0.1% of plutocrats.

namdnay 4y ago
the problem is that the majority of active voters are using real estate as an investment vehicle. convincing an investor in X to ban investment in X is pretty tricky ...
- Melatonic 4y ago
  That can be a very different scenario though - a family using one (or even multiple) properties as investment vehicles that they are themselves residing in (even if its just part of the year) does not seem unethical at all to me. Foreign investors who are not planning to even live on the property nor rent it out at all? Definitely a crapshoot. It is a small overall percentage of the pie but every bit counts. And giant corporations scooping up tons of single family homes and small apartment complexes is maybe even scarier. Lets face it though - there's a separate problem and it is pretty simple - we just need more housing in places where the demand is high. Personally I think it would be especially helpful in the short term if there were big incentives for individuals to ADU's or inlaw units and things like duplexes, triplexes, or "bungalows" on one property. Easy sell for the public and would open up all of the single family home zones to much more housing and maybe even incentivize families across generations to live together again.
  - dapids 4y ago
    a small overall percentage? More than one third of Vancouver Canada's real-estate is foreign owned.
    - umeshunni 4y ago
      That sounds exaggerated. https://www.theglobeandmail.com/opinion/editorials/article-are-foreign-owners-of-empty-homes-to-blame-for-canadas-unaffordable/ https://www.theglobeandmail.com/opinion/editorials/article-a... seems to say 2-6% https://blog.remax.ca/are-foreign-buyers-still-purchasing-vancouver-real-estate/ https://blog.remax.ca/are-foreign-buyers-still-purchasing-va... says 1.4% in 2020.
      - dapids 4y ago
        As someone who lives in Vancouver, its quite a different story, and most of those I know, really don't understand where these stats come from. There is not a week that goes by I have someone knocking on the door of our family home asking to buy it. There are four owners left on our street that are the original owners, the rest are vacation homes for Chinese, and completely vacant. This is far from exaggerated. https://www.fortunebuilders.com/one-third-of-vancouvers-real-estate-market-is-owned-by-chinese-buyers/ https://www.fortunebuilders.com/one-third-of-vancouvers-real... https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/additional-property-transfer-tax https://www2.gov.bc.ca/gov/content/taxes/property-taxes/prop...
        Pokepokalypse 4y ago
        We sold my daughter's condo 2 years ago, and we're still getting email solititations to buy it. Apparently there's a company sitting behind about a half-dozen shell companies, and they're trying to buy up enough units that they can sit on the association board, and convert the whole complex to rentals; forcing the remaining owners to sell. I'm glad I got her out of there 2 years ago. The rising crime problem there was the motivating factor.
- bonestamp2 4y ago
  You're right, but I assume there would be an exemption for the home you live in. That would be a great exemption too since it might be incentive for people to subdivide their home to create more dwellings.
pessimizer 4y ago
Oh, we'll still live in the same places, it's just the rents will float to as high as they have to be to deplete our disposable income and put us into debt.
- ChrisMarshallNY 4y ago
  I have a friend that is a real estate broker. His job is to act as a scout and local broker for corporations that buy up residential properties, then turn them into rentals. He makes great money. Most of his work is in "distressed" areas. Many NIMBY neighborhoods don't like rentals, but poorer sections of the county don't fight it, and may even welcome it. I'm of two minds about his work. On one hand, John Oliver did a big segment, roasting corporate rentals[0], but I have also seen local slumlords treat renters like garbage (I actually rented from one, at the start of my career, and can attest to that). [0] https://www.youtube.com/watch?v=L4qmDnYli2E https://www.youtube.com/watch?v=L4qmDnYli2E
SnowHill9902 4y ago
Investors can provide liquidity and dampening to an otherwise relatively slow market.
- nanidin 4y ago
  They provide liquidity, but further slow the market if they turn it into a rental with ROI targets.
api 4y ago
The problem is that the instant you sign a mortgage you become a real estate investor.
mchusma 4y ago
There are many good reasons for real estate to be an investment vehicle. You won't convince someone to build a new apartment building if they can't make money. In fact, we really really want people to build more, better housing. The current real estate "market" is certainly far from a "free market". If we live restrictions on supply, by removing things like: - Minimum parking requirements - Maximum height requirements - Aesthetic requirements There are also demand-side subsidies for home ownership that make it more expensive, such as the mortgage tax credit. A land value tax is another way to encourage people to improve the land. https://localhousingsolutions.org/housing-policy-library/land-value-taxation/#:~:text=Land%20value%20taxation%20is%20an,other%20improvements%20to%20the%20site https://localhousingsolutions.org/housing-policy-library/lan.... I agree we can't have real estate be both a great investment (increase faster than inflation) and affordable (decrease on inflation adjusted basis). I think adopting more of a free market here would really improve things for everyone. Note: I also think congestion pricing + eliminating free parking would solve many of the related problems to this issue, and are important parts of a solution.
- miguelazo 4y ago
  In more civilized countries, plenty of housing stock is built by the government, which is why it is not treated as an investment commodity for speculation.
  - Plasmoid 4y ago
    The problem is people hate new housing. Until you change public perception of this relegating this to the government is going to make the situation worse. Right now, private builders can bribe people to allow construction if the market price is high enough. If the government had to do it, there would be basically no new construction. It's politically unpopular and very expensive, so it's an easy project to axe.
    - miguelazo 4y ago
      People hate new housing because it’s 95% luxury condos and McMansions in the US, precisely because we rely too much on the private sector to build housing. Of course they will only focus on units with the fattest margins.
gnopgnip 4y ago
Open door is trying to replace realtors, providing a “better”service as a real estate broker. They aren’t competing with buyers or sellers, they aren’t going to own homes long term
- theduder99 4y ago
  yet. remember what happened when zillow got greedy and started to expand into home buying.
  - no-dr-onboard 4y ago
    I'm not sure where the argument is going with this one, but Zillow did poorly for a variety of reasons. They bought at low prices hoping to sell high and tanked their business (Owned By Zillow, not the site). Homes owned by Zillow stayed on the market _significantly_ longer than their traditionally held counterparts. As a homebuyer in the past year I can personally attest that of the 4 realtors I dealt with, not a single one felt inclined to show a "Owned by Zillow" home. In all showings they were poorly maintained and prepped. It *felt* like an abandoned home.
- newfonewhodis 4y ago
  > They aren’t competing with buyers or sellers Lol what? They are literally a buyer and then a seller for a house. So yes they are competing with other buyers and sellers.
- dragonwriter 4y ago
  > They aren’t competing with buyers or sellers They literally are, by acting as both a buyer and a seller. Their publicly claimed business model was that that is incidental, and that they are really a fee-based facilitator, but... that also apparently was knowing fraud, so, maybe it shouldn't be given much weight.
coding123 4y ago
I don't think that's possible, but there are things we can do: - Tax empty houses a REALLY high amount after a month of occupancy loss. This puts extremely high pressure to get the house sold after the month. Living in your house while you sell it? No penalties. - Make renting a house extremely painful for landlords. Renting can be replaced with new forms of community ownership - communities that own X properties in many cities and people can swap (for job relocation and other things). The Landlord business IS the oldest rent-seeking business. Buy a property, rent it out, pay nothing on it for 30 years and at the end of that - it's yours. In my opinion that should be illegal. People that disagree are landlords and people that think renting is the only way. Invent new ways to do short term house ownership. This is the startup capital of the world (HN). - Require unused office space to become homeless shelters if unused after 6 months. Government will pay for the lease at a fixed maximum price. Get your shit leased or house the homeless. The jist of this is that if we did things like this, we would probably have no homeless, the price of homes would come down, and everyone would have a home. In fact we would have such a huge surplus of homes, most people would be able to easily upgrade.
- scarby2 4y ago
  > In fact we would have such a huge surplus of homes, most people would be able to easily upgrade. given that more than 95% of homes are currently occupied we would not have a surplus. while some of your suggestions could have a place there is no replacement for building more homes
- plasticchris 4y ago
  On taxing empty houses - I once had an opportunity which required me to move across the country and my old house sat vacant for months despite pricing it pretty low (when you are 2k miles away it is hard to sell something), and a tax combined with the state laws preventing me from giving it to the bank would have been a perfect storm of misery despite my desire to let someone else live there.
candiddevmike 4y ago
Shelter should be a human right. Everyone who needs housing should be able to get an apartment, for free, and landlords should have to compete against free by offering better places with nicer amenities.
- endisneigh 4y ago
  this must be sarcasm, lol
cactus2093 4y ago
> We won't be able to do that anymore when all of the habitable land is owned by the 0.1% of plutocrats. The homeownership rate in the US has actually stayed surprisingly constant over time, it's fluctuated between about 62% and 69% since the mid 1960's and is now around 65% [0]. We've got quite a long way to go to 0.1%. [0] https://tradingeconomics.com/united-states/home-ownership-rate https://tradingeconomics.com/united-states/home-ownership-ra...
planarhobbit 4y ago
Correct. We do not all share this planet. You’re lucky the plutocrats haven’t put you against the wall and shot you but they simply don’t think you’re worth the effort to dispose of. The moment that effort is decreased enough such that your presence and being is more burden than worthwhile, you will be put out of your misery. If you truly believe that you should have a right, you’ll have to fight for it. Posting on HN calling for a ban isn’t going to cut it. You’ll have to put an end to it and enforce it. Just like they do when they want something.

namdnay 4y ago

the problem is that the majority of active voters are using real estate as an investment vehicle. convincing an investor in X to ban investment in X is pretty tricky ...

Melatonic 4y ago
That can be a very different scenario though - a family using one (or even multiple) properties as investment vehicles that they are themselves residing in (even if its just part of the year) does not seem unethical at all to me. Foreign investors who are not planning to even live on the property nor rent it out at all? Definitely a crapshoot. It is a small overall percentage of the pie but every bit counts. And giant corporations scooping up tons of single family homes and small apartment complexes is maybe even scarier. Lets face it though - there's a separate problem and it is pretty simple - we just need more housing in places where the demand is high. Personally I think it would be especially helpful in the short term if there were big incentives for individuals to ADU's or inlaw units and things like duplexes, triplexes, or "bungalows" on one property. Easy sell for the public and would open up all of the single family home zones to much more housing and maybe even incentivize families across generations to live together again.
- dapids 4y ago
  a small overall percentage? More than one third of Vancouver Canada's real-estate is foreign owned.
  - umeshunni 4y ago
    That sounds exaggerated. https://www.theglobeandmail.com/opinion/editorials/article-are-foreign-owners-of-empty-homes-to-blame-for-canadas-unaffordable/ https://www.theglobeandmail.com/opinion/editorials/article-a... seems to say 2-6% https://blog.remax.ca/are-foreign-buyers-still-purchasing-vancouver-real-estate/ https://blog.remax.ca/are-foreign-buyers-still-purchasing-va... says 1.4% in 2020.
    - dapids 4y ago
      As someone who lives in Vancouver, its quite a different story, and most of those I know, really don't understand where these stats come from. There is not a week that goes by I have someone knocking on the door of our family home asking to buy it. There are four owners left on our street that are the original owners, the rest are vacation homes for Chinese, and completely vacant. This is far from exaggerated. https://www.fortunebuilders.com/one-third-of-vancouvers-real-estate-market-is-owned-by-chinese-buyers/ https://www.fortunebuilders.com/one-third-of-vancouvers-real... https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/additional-property-transfer-tax https://www2.gov.bc.ca/gov/content/taxes/property-taxes/prop...
      - Pokepokalypse 4y ago
        We sold my daughter's condo 2 years ago, and we're still getting email solititations to buy it. Apparently there's a company sitting behind about a half-dozen shell companies, and they're trying to buy up enough units that they can sit on the association board, and convert the whole complex to rentals; forcing the remaining owners to sell. I'm glad I got her out of there 2 years ago. The rising crime problem there was the motivating factor.
bonestamp2 4y ago
You're right, but I assume there would be an exemption for the home you live in. That would be a great exemption too since it might be incentive for people to subdivide their home to create more dwellings.

pessimizer 4y ago

Oh, we'll still live in the same places, it's just the rents will float to as high as they have to be to deplete our disposable income and put us into debt.

ChrisMarshallNY 4y ago
I have a friend that is a real estate broker. His job is to act as a scout and local broker for corporations that buy up residential properties, then turn them into rentals. He makes great money. Most of his work is in "distressed" areas. Many NIMBY neighborhoods don't like rentals, but poorer sections of the county don't fight it, and may even welcome it. I'm of two minds about his work. On one hand, John Oliver did a big segment, roasting corporate rentals[0], but I have also seen local slumlords treat renters like garbage (I actually rented from one, at the start of my career, and can attest to that). [0] https://www.youtube.com/watch?v=L4qmDnYli2E https://www.youtube.com/watch?v=L4qmDnYli2E

SnowHill9902 4y ago

Investors can provide liquidity and dampening to an otherwise relatively slow market.

nanidin 4y ago
They provide liquidity, but further slow the market if they turn it into a rental with ROI targets.

api 4y ago

The problem is that the instant you sign a mortgage you become a real estate investor.

mchusma 4y ago

There are many good reasons for real estate to be an investment vehicle. You won't convince someone to build a new apartment building if they can't make money. In fact, we really really want people to build more, better housing. The current real estate "market" is certainly far from a "free market". If we live restrictions on supply, by removing things like: - Minimum parking requirements - Maximum height requirements - Aesthetic requirements There are also demand-side subsidies for home ownership that make it more expensive, such as the mortgage tax credit. A land value tax is another way to encourage people to improve the land. https://localhousingsolutions.org/housing-policy-library/land-value-taxation/#:~:text=Land%20value%20taxation%20is%20an,other%20improvements%20to%20the%20site https://localhousingsolutions.org/housing-policy-library/lan.... I agree we can't have real estate be both a great investment (increase faster than inflation) and affordable (decrease on inflation adjusted basis). I think adopting more of a free market here would really improve things for everyone. Note: I also think congestion pricing + eliminating free parking would solve many of the related problems to this issue, and are important parts of a solution.

miguelazo 4y ago
In more civilized countries, plenty of housing stock is built by the government, which is why it is not treated as an investment commodity for speculation.
- Plasmoid 4y ago
  The problem is people hate new housing. Until you change public perception of this relegating this to the government is going to make the situation worse. Right now, private builders can bribe people to allow construction if the market price is high enough. If the government had to do it, there would be basically no new construction. It's politically unpopular and very expensive, so it's an easy project to axe.
  - miguelazo 4y ago
    People hate new housing because it’s 95% luxury condos and McMansions in the US, precisely because we rely too much on the private sector to build housing. Of course they will only focus on units with the fattest margins.

gnopgnip 4y ago

Open door is trying to replace realtors, providing a “better”service as a real estate broker. They aren’t competing with buyers or sellers, they aren’t going to own homes long term

theduder99 4y ago
yet. remember what happened when zillow got greedy and started to expand into home buying.
- no-dr-onboard 4y ago
  I'm not sure where the argument is going with this one, but Zillow did poorly for a variety of reasons. They bought at low prices hoping to sell high and tanked their business (Owned By Zillow, not the site). Homes owned by Zillow stayed on the market _significantly_ longer than their traditionally held counterparts. As a homebuyer in the past year I can personally attest that of the 4 realtors I dealt with, not a single one felt inclined to show a "Owned by Zillow" home. In all showings they were poorly maintained and prepped. It *felt* like an abandoned home.
newfonewhodis 4y ago
> They aren’t competing with buyers or sellers Lol what? They are literally a buyer and then a seller for a house. So yes they are competing with other buyers and sellers.
dragonwriter 4y ago
> They aren’t competing with buyers or sellers They literally are, by acting as both a buyer and a seller. Their publicly claimed business model was that that is incidental, and that they are really a fee-based facilitator, but... that also apparently was knowing fraud, so, maybe it shouldn't be given much weight.

coding123 4y ago

I don't think that's possible, but there are things we can do: - Tax empty houses a REALLY high amount after a month of occupancy loss. This puts extremely high pressure to get the house sold after the month. Living in your house while you sell it? No penalties. - Make renting a house extremely painful for landlords. Renting can be replaced with new forms of community ownership - communities that own X properties in many cities and people can swap (for job relocation and other things). The Landlord business IS the oldest rent-seeking business. Buy a property, rent it out, pay nothing on it for 30 years and at the end of that - it's yours. In my opinion that should be illegal. People that disagree are landlords and people that think renting is the only way. Invent new ways to do short term house ownership. This is the startup capital of the world (HN). - Require unused office space to become homeless shelters if unused after 6 months. Government will pay for the lease at a fixed maximum price. Get your shit leased or house the homeless. The jist of this is that if we did things like this, we would probably have no homeless, the price of homes would come down, and everyone would have a home. In fact we would have such a huge surplus of homes, most people would be able to easily upgrade.

scarby2 4y ago
> In fact we would have such a huge surplus of homes, most people would be able to easily upgrade. given that more than 95% of homes are currently occupied we would not have a surplus. while some of your suggestions could have a place there is no replacement for building more homes
plasticchris 4y ago
On taxing empty houses - I once had an opportunity which required me to move across the country and my old house sat vacant for months despite pricing it pretty low (when you are 2k miles away it is hard to sell something), and a tax combined with the state laws preventing me from giving it to the bank would have been a perfect storm of misery despite my desire to let someone else live there.

candiddevmike 4y ago

Shelter should be a human right. Everyone who needs housing should be able to get an apartment, for free, and landlords should have to compete against free by offering better places with nicer amenities.

endisneigh 4y ago
this must be sarcasm, lol

cactus2093 4y ago

> We won't be able to do that anymore when all of the habitable land is owned by the 0.1% of plutocrats. The homeownership rate in the US has actually stayed surprisingly constant over time, it's fluctuated between about 62% and 69% since the mid 1960's and is now around 65% [0]. We've got quite a long way to go to 0.1%. [0] https://tradingeconomics.com/united-states/home-ownership-rate https://tradingeconomics.com/united-states/home-ownership-ra...

planarhobbit 4y ago

Correct. We do not all share this planet. You’re lucky the plutocrats haven’t put you against the wall and shot you but they simply don’t think you’re worth the effort to dispose of. The moment that effort is decreased enough such that your presence and being is more burden than worthwhile, you will be put out of your misery. If you truly believe that you should have a right, you’ll have to fight for it. Posting on HN calling for a ban isn’t going to cut it. You’ll have to put an end to it and enforce it. Just like they do when they want something.