7 ms·

It's quite bizarre any jurisdiction would allow someone to buy housing there when they can't legally live in it.

by causi 3y ago

slavboj 3y ago
Approximately anyone can buy a US-based REIT, even if they're ineligible to enter the country.
- bdcravens 3y ago
  This is less of an issue than owning the home, since in an REIT, you aren't controlling tenant access.
alchemist1e9 3y ago
Why? Should we restrict other investments with similar logic? For example should non-residents not be allowed to purchase vacation properties and lease them? The impulse to enlist the government to regulate private property and investments is not productive and results in endless encroachment of individual liberties and rights to governments.
- Fauntleroy 3y ago
  There's a little too much "housing is way too incredibly expensive for the citizens of the country" going on here for us to really care about "fairness of the open market"
- stormfather 3y ago
  Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation.
  - gsk22 3y ago
    Sure, but the high cost of housing has little to do with non-resident investors, and everything to do with lack of supply.
    - bdcravens 3y ago
      Resident investors are a big part of the problem, however.
      - alchemist1e9 3y ago
        Off with their heads! /s
  - Fauntleroy 3y ago
    Or if we don't want to watch it collapse during ours.
  - alchemist1e9 3y ago
    Blaming foreign investors for a housing crisis is a smokescreen. It's not the demand from investors that's the issue; it's the government's stifling regulations that choke new construction. The mess is because of state failure, not market failure. When sellers freely sell their homes to foreign buyers, they're making choices that benefit them. Why should we deny them that right? The real absurdity is ignoring the elephant in the room: a bureaucratic quagmire that prevents building enough homes to meet demand. Instead of scapegoating investors, slash the red tape and let the market work.
    - function_seven 3y ago
      Yup. The Power of Pricing is a thing that exists whether you want it to or not. Smart policy uses it to great advantage. Dumb policy redirects this to hurt those it intends to help. Rent control, restrictions on production, byzantine zoning and construction rules... all contribute to distorting the market in ways that push back on the original (or at least, stated) intentions. You want housing to be cheaper? Increase supply. That's it. You don't want foreign investment in your properties? Don't make them so damn attractive as pure investment vehicles. How? Increase supply. There's always a boogeyman to be blamed when markets are so broken like this.
      - alchemist1e9 3y ago
        Absolutely correct. Unfortunately and surprisingly the supposedly educated users of HN are overwhelmingly anti-capitalists somehow, your opinion and mine are decidedly in the minority recently, and that is itself fascinating to me, as I can only conclude the education system is completely broken and failing to teach both basic economics which consists of facts and is scientific and also history. I liken it to teaching creationism over evolution, preferring fantasy over reality.
      - denton-scratch 3y ago
        > You want housing to be cheaper? Increase supply. The USA (and maybe Canada) has large stocks of government land. In my country, most land is privately-owned; interfering with landowners' property rights is seriously destabilising. Property law is the basis of most law.
  - inglor_cz 3y ago
    "Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation." Drastic? Well, then: kill NIMBYism. Just off with its head. We know the 18th century in England as the "Gin Craze", future generations will look at our period as the "NIMBY Craze". Large-scale construction is absolutely possible. There were periods of massive construction booms all around the globe, especially after wars (when a lot of housing had to be rebuilt immediately). You can absolutely build a lot of comfortable middle-class housing in a fairly short time. Most German cities were rubble in 1945 and fine again in 1960. But you need density and straightforward approval processes. No artificial scarcity caused by one-family home zoning and endless environmental reviews that are abused to stall developments for decades.
- soggybread 3y ago
  >For example should non-residents not be allowed to purchase vacation properties and lease them? AirB&B has been a terrible experience, so many people buying up houses just to lease them out for a weekend has definitely contributed to rising housing costs and over-all cost of living
  - bdcravens 3y ago
    That's an issue absolutely, but it doesn't answer the question of whether non-residents should be allowed to do what residents can.
    - JumpCrisscross 3y ago
      > it doesn't answer the question of whether non-residents should be allowed to do what residents can Raise that fence too high and you turn landlords into the community's gatekeepers. (How else could a non-resident become a resident?)
      - alchemist1e9 3y ago
        Don’t worry the HN crowd seems to be so far gone from reality and understanding free markets that I’ve encountered numerous discussions where landlords are categorically evil, which is overwhelmingly empirically understood to be extremely beneficial to housing and communities to have landlords invest in them! Of course given the trend has been to remove all education of market fundamentals and inject eduction systems with endless collectivist propaganda we should not be surprised.
- tslocum 3y ago
  Yes. Restricting foreigners from owning domestic assets is the beginning. Next comes restricting / heavily taxing domestic owners that own more than one home. Sooner or later, housing gets closer to being what it's supposed to be (shelter and space for people who need it) rather than a financial vehicle.
  - alchemist1e9 3y ago
    This proposal is a slippery slope to economic disaster. First, restricting ownership rights—foreign or domestic—distorts the market, disincentivizes investment, and ultimately harms those it claims to help by reducing the supply of housing. Second, treating homes purely as shelter ignores the reality that property is also an investment and a key component of individual wealth and economic freedom. Imposing heavy taxes on those owning more than one home would not only penalize success but also discourage rental market contributions, exacerbating the housing shortage. The real solution lies in encouraging development and reducing bureaucratic barriers to increase housing supply, not in draconian measures that trample on property rights and stifle economic growth. Let’s not replace a market-driven approach with a command economy that history has repeatedly shown to fail.
    - IncreasePosts 3y ago
      How about an ultimatum? Either people can only own one house without huge tax consequences, OR we open up restrictions on building so we can build a lot more housing stock than we currently do.
    - denton-scratch 3y ago
      > treating homes purely as shelter ignores the reality that property is also an investment But that's the problem, isn't it? The basic necessities of life shouldn't become a vehicle for speculation. FTR, all of my wealth is in two homes.
      - alchemist1e9 3y ago
        Asserting that housing—or any basic necessity—shouldn’t be an investment is a dangerously naive stance that flies in the face of economic reality and human history. Consider food, water, healthcare—all necessities, yet all benefit from private investment and innovation. The collectivist dream to strip away the investment aspect of housing is a recipe for disaster, leading to shortages, degradation, and inefficiency. Your stance isn’t just misguided; it’s empirically proven to fail, fostering misery under the guise of equality. Housing, like any resource, flourishes under conditions of freedom, not under the heavy hand of state control. To suggest otherwise is to ignore the lessons of history and to jeopardize the very foundations of prosperity and freedom.
StopTheTechies 3y ago
[dead]
JumpCrisscross 3y ago
> bizarre any jurisdiction would allow someone to buy housing there when they can't legally live in it Foreign-owned homes are a problem for asset acquirers. Vacant homes are a problem for anyone who needs housing. The former seems to get a lot of visibilty when concerns around the latter get raised.
- alchemist1e9 3y ago
  > Vacant homes are a problem for anyone who needs housing. But they pay taxes without demanding any services and the seller assessed they had better use of the capital, they could buy or build a more suitable home. If I lived in a location with 50% vacant homes all paying property taxes then wouldn’t my schools and streets and all local government services be extremely well funded?
  - JumpCrisscross 3y ago
    > If I lived in a location with 50% vacant homes all paying property taxes then wouldn’t my schools and streets and all local government services be extremely well funded If the polity is smart, yes. It looks like British Columbia gets about 15% of its revenue from property taxes and transfers [1]. So you'd need adjustments to make up for the personal, corporate, sales, fuel, carbon, tobacco and insurance premium (?) revenues the vacant homeowner isn't paying. [1] https://www2.gov.bc.ca/assets/gov/british-columbians-our-governments/government-finances/financial-economic-review/financial-economic-review-2022.pdf https://www2.gov.bc.ca/assets/gov/british-columbians-our-gov... Table 2.3
    - wasimanitoba 3y ago
      Assuming the drop in social program expenditure doesn't already compensate for the drop in tax revenue.
  - causi 3y ago
    Kind of by definition you can't pay more in taxes than you contribute to the economy, therefore unoccupied housing is a drain on the local economy.
caseysoftware 3y ago
In the US, banks issue mortgages to illegal immigrants all the time. Last fall, the Biden Administration went as far as threatening banks who had refused. > “This guidance reminds lenders that denying someone access to credit based solely on their actual or perceived immigrant status may violate federal law.” Ref: https://www.justice.gov/opa/pr/justice-department-and-consumer-financial-protection-bureau-issue-joint-statement-cautioning https://www.justice.gov/opa/pr/justice-department-and-consum...
mytailorisrich 3y ago
Most governments would do anything for foreign direct investment. From many points of view, having foreign investors buy property without immigrating is a best case scenario for governments.
- ericmcer 3y ago
  In the long run (30+ years from now)? Or just for the few years they are in office?
  - mytailorisrich 3y ago
    I think probably in the long run because, all in all, net inbound capital into the economy is positive in the long run. What can cause problems is bubbles and 'over-heating', meaning too much over a too short period, which is when 'less' inbound capital may be sought. But overall best to keep the flow positive.
- againdot 3y ago
  Then that's fantastic! Since housing has come so unaffordable in Canada I'm looking at moving to Japan. I'm seeing detached houses 60m transit from Tokyo for less than a down payment on a condo 60m from Vancouver. So if I buy a place there and move, it's win/win for everyone!
toast0 3y ago
It seems like a waste of limited government ability to act to try to deny this when it's quite simple for an interested foreign investor to form or invest in a domestic corporation that buys housing it doesn't live in, or find a domestic partner to make straw purchases of housing the partner doesn't live in.
ericmcer 3y ago
It feels like selling the next generations future for cash now.
michael1999 3y ago
The historical Canadian project, like all anglo settler projects, is structurally about early arrivals to the frontier making money selling to later arrivals. The idea that housing is primarily for locals is a newer idea.
asah 3y ago
There's "housing" and then there's $5+MM manhattan apartments, which are so inflated above their value as functional housing as to effectively be NFTs. People whine about the pencil shaped buildings but they shutup fast when they see that it causes zero inflation to lower-end housing prices and a big help to city budgets. Also, strategically, having powerful people own expensive real estate influences them to visit and maybe not bomb it... at least, it's better than them never having stepped foot there. The famous example is Kyoto not being nuked because an American leader had seen it firsthand[1]. The Nazis spared Paris was apparently spared for similar reasons[2]. The counterexample is NYC which everybody loves to crap on (Gerald Ford "drop dead", 1993 bombing, 9/11, and lots of failed terrorist attacks since), presumably as a symbol of American greed and excess, but also as a symbol of urban chaos, rot and violence. [1] https://collider.com/oppenheimer-improvised-line-kyoto/ https://collider.com/oppenheimer-improvised-line-kyoto/ [2] https://www.google.com/search?q=Nazis+spared+Paris https://www.google.com/search?q=Nazis+spared+Paris

It's quite bizarre any jurisdiction would allow someone to buy housing there when they can't legally live in it.

by causi 3y ago

It's quite bizarre any jurisdiction would allow someone to buy housing there when they can't legally live in it.

slavboj 3y ago

Approximately anyone can buy a US-based REIT, even if they're ineligible to enter the country.

bdcravens 3y ago
This is less of an issue than owning the home, since in an REIT, you aren't controlling tenant access.

alchemist1e9 3y ago

Why? Should we restrict other investments with similar logic? For example should non-residents not be allowed to purchase vacation properties and lease them? The impulse to enlist the government to regulate private property and investments is not productive and results in endless encroachment of individual liberties and rights to governments.

Fauntleroy 3y ago
There's a little too much "housing is way too incredibly expensive for the citizens of the country" going on here for us to really care about "fairness of the open market"
stormfather 3y ago
Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation.
- gsk22 3y ago
  Sure, but the high cost of housing has little to do with non-resident investors, and everything to do with lack of supply.
  - bdcravens 3y ago
    Resident investors are a big part of the problem, however.
    - alchemist1e9 3y ago
      Off with their heads! /s
- Fauntleroy 3y ago
  Or if we don't want to watch it collapse during ours.
- alchemist1e9 3y ago
  Blaming foreign investors for a housing crisis is a smokescreen. It's not the demand from investors that's the issue; it's the government's stifling regulations that choke new construction. The mess is because of state failure, not market failure. When sellers freely sell their homes to foreign buyers, they're making choices that benefit them. Why should we deny them that right? The real absurdity is ignoring the elephant in the room: a bureaucratic quagmire that prevents building enough homes to meet demand. Instead of scapegoating investors, slash the red tape and let the market work.
  - function_seven 3y ago
    Yup. The Power of Pricing is a thing that exists whether you want it to or not. Smart policy uses it to great advantage. Dumb policy redirects this to hurt those it intends to help. Rent control, restrictions on production, byzantine zoning and construction rules... all contribute to distorting the market in ways that push back on the original (or at least, stated) intentions. You want housing to be cheaper? Increase supply. That's it. You don't want foreign investment in your properties? Don't make them so damn attractive as pure investment vehicles. How? Increase supply. There's always a boogeyman to be blamed when markets are so broken like this.
    - alchemist1e9 3y ago
      Absolutely correct. Unfortunately and surprisingly the supposedly educated users of HN are overwhelmingly anti-capitalists somehow, your opinion and mine are decidedly in the minority recently, and that is itself fascinating to me, as I can only conclude the education system is completely broken and failing to teach both basic economics which consists of facts and is scientific and also history. I liken it to teaching creationism over evolution, preferring fantasy over reality.
    - denton-scratch 3y ago
      > You want housing to be cheaper? Increase supply. The USA (and maybe Canada) has large stocks of government land. In my country, most land is privately-owned; interfering with landowners' property rights is seriously destabilising. Property law is the basis of most law.
- inglor_cz 3y ago
  "Something drastic has to be done about the cost of housing if we're to leave a functional society to the next generation." Drastic? Well, then: kill NIMBYism. Just off with its head. We know the 18th century in England as the "Gin Craze", future generations will look at our period as the "NIMBY Craze". Large-scale construction is absolutely possible. There were periods of massive construction booms all around the globe, especially after wars (when a lot of housing had to be rebuilt immediately). You can absolutely build a lot of comfortable middle-class housing in a fairly short time. Most German cities were rubble in 1945 and fine again in 1960. But you need density and straightforward approval processes. No artificial scarcity caused by one-family home zoning and endless environmental reviews that are abused to stall developments for decades.
soggybread 3y ago
>For example should non-residents not be allowed to purchase vacation properties and lease them? AirB&B has been a terrible experience, so many people buying up houses just to lease them out for a weekend has definitely contributed to rising housing costs and over-all cost of living
- bdcravens 3y ago
  That's an issue absolutely, but it doesn't answer the question of whether non-residents should be allowed to do what residents can.
  - JumpCrisscross 3y ago
    > it doesn't answer the question of whether non-residents should be allowed to do what residents can Raise that fence too high and you turn landlords into the community's gatekeepers. (How else could a non-resident become a resident?)
    - alchemist1e9 3y ago
      Don’t worry the HN crowd seems to be so far gone from reality and understanding free markets that I’ve encountered numerous discussions where landlords are categorically evil, which is overwhelmingly empirically understood to be extremely beneficial to housing and communities to have landlords invest in them! Of course given the trend has been to remove all education of market fundamentals and inject eduction systems with endless collectivist propaganda we should not be surprised.
tslocum 3y ago
Yes. Restricting foreigners from owning domestic assets is the beginning. Next comes restricting / heavily taxing domestic owners that own more than one home. Sooner or later, housing gets closer to being what it's supposed to be (shelter and space for people who need it) rather than a financial vehicle.
- alchemist1e9 3y ago
  This proposal is a slippery slope to economic disaster. First, restricting ownership rights—foreign or domestic—distorts the market, disincentivizes investment, and ultimately harms those it claims to help by reducing the supply of housing. Second, treating homes purely as shelter ignores the reality that property is also an investment and a key component of individual wealth and economic freedom. Imposing heavy taxes on those owning more than one home would not only penalize success but also discourage rental market contributions, exacerbating the housing shortage. The real solution lies in encouraging development and reducing bureaucratic barriers to increase housing supply, not in draconian measures that trample on property rights and stifle economic growth. Let’s not replace a market-driven approach with a command economy that history has repeatedly shown to fail.
  - IncreasePosts 3y ago
    How about an ultimatum? Either people can only own one house without huge tax consequences, OR we open up restrictions on building so we can build a lot more housing stock than we currently do.
  - denton-scratch 3y ago
    > treating homes purely as shelter ignores the reality that property is also an investment But that's the problem, isn't it? The basic necessities of life shouldn't become a vehicle for speculation. FTR, all of my wealth is in two homes.
    - alchemist1e9 3y ago
      Asserting that housing—or any basic necessity—shouldn’t be an investment is a dangerously naive stance that flies in the face of economic reality and human history. Consider food, water, healthcare—all necessities, yet all benefit from private investment and innovation. The collectivist dream to strip away the investment aspect of housing is a recipe for disaster, leading to shortages, degradation, and inefficiency. Your stance isn’t just misguided; it’s empirically proven to fail, fostering misery under the guise of equality. Housing, like any resource, flourishes under conditions of freedom, not under the heavy hand of state control. To suggest otherwise is to ignore the lessons of history and to jeopardize the very foundations of prosperity and freedom.

StopTheTechies 3y ago

[dead]

JumpCrisscross 3y ago

> bizarre any jurisdiction would allow someone to buy housing there when they can't legally live in it Foreign-owned homes are a problem for asset acquirers. Vacant homes are a problem for anyone who needs housing. The former seems to get a lot of visibilty when concerns around the latter get raised.

alchemist1e9 3y ago
> Vacant homes are a problem for anyone who needs housing. But they pay taxes without demanding any services and the seller assessed they had better use of the capital, they could buy or build a more suitable home. If I lived in a location with 50% vacant homes all paying property taxes then wouldn’t my schools and streets and all local government services be extremely well funded?
- JumpCrisscross 3y ago
  > If I lived in a location with 50% vacant homes all paying property taxes then wouldn’t my schools and streets and all local government services be extremely well funded If the polity is smart, yes. It looks like British Columbia gets about 15% of its revenue from property taxes and transfers [1]. So you'd need adjustments to make up for the personal, corporate, sales, fuel, carbon, tobacco and insurance premium (?) revenues the vacant homeowner isn't paying. [1] https://www2.gov.bc.ca/assets/gov/british-columbians-our-governments/government-finances/financial-economic-review/financial-economic-review-2022.pdf https://www2.gov.bc.ca/assets/gov/british-columbians-our-gov... Table 2.3
  - wasimanitoba 3y ago
    Assuming the drop in social program expenditure doesn't already compensate for the drop in tax revenue.
- causi 3y ago
  Kind of by definition you can't pay more in taxes than you contribute to the economy, therefore unoccupied housing is a drain on the local economy.

caseysoftware 3y ago

In the US, banks issue mortgages to illegal immigrants all the time. Last fall, the Biden Administration went as far as threatening banks who had refused. > “This guidance reminds lenders that denying someone access to credit based solely on their actual or perceived immigrant status may violate federal law.” Ref: https://www.justice.gov/opa/pr/justice-department-and-consumer-financial-protection-bureau-issue-joint-statement-cautioning https://www.justice.gov/opa/pr/justice-department-and-consum...

mytailorisrich 3y ago

Most governments would do anything for foreign direct investment. From many points of view, having foreign investors buy property without immigrating is a best case scenario for governments.

ericmcer 3y ago
In the long run (30+ years from now)? Or just for the few years they are in office?
- mytailorisrich 3y ago
  I think probably in the long run because, all in all, net inbound capital into the economy is positive in the long run. What can cause problems is bubbles and 'over-heating', meaning too much over a too short period, which is when 'less' inbound capital may be sought. But overall best to keep the flow positive.
againdot 3y ago
Then that's fantastic! Since housing has come so unaffordable in Canada I'm looking at moving to Japan. I'm seeing detached houses 60m transit from Tokyo for less than a down payment on a condo 60m from Vancouver. So if I buy a place there and move, it's win/win for everyone!

toast0 3y ago

It seems like a waste of limited government ability to act to try to deny this when it's quite simple for an interested foreign investor to form or invest in a domestic corporation that buys housing it doesn't live in, or find a domestic partner to make straw purchases of housing the partner doesn't live in.

ericmcer 3y ago

It feels like selling the next generations future for cash now.

michael1999 3y ago

The historical Canadian project, like all anglo settler projects, is structurally about early arrivals to the frontier making money selling to later arrivals. The idea that housing is primarily for locals is a newer idea.

asah 3y ago

There's "housing" and then there's $5+MM manhattan apartments, which are so inflated above their value as functional housing as to effectively be NFTs. People whine about the pencil shaped buildings but they shutup fast when they see that it causes zero inflation to lower-end housing prices and a big help to city budgets. Also, strategically, having powerful people own expensive real estate influences them to visit and maybe not bomb it... at least, it's better than them never having stepped foot there. The famous example is Kyoto not being nuked because an American leader had seen it firsthand[1]. The Nazis spared Paris was apparently spared for similar reasons[2]. The counterexample is NYC which everybody loves to crap on (Gerald Ford "drop dead", 1993 bombing, 9/11, and lots of failed terrorist attacks since), presumably as a symbol of American greed and excess, but also as a symbol of urban chaos, rot and violence. [1] https://collider.com/oppenheimer-improvised-line-kyoto/ https://collider.com/oppenheimer-improvised-line-kyoto/ [2] https://www.google.com/search?q=Nazis+spared+Paris https://www.google.com/search?q=Nazis+spared+Paris