The sad part is how politicians and organized groups are seemingly afraid to change their direction for fear of voter retribution. Comparing datasets across states and regions, it is not entirely clear to me which had the most effective policies. I would like to see an official CDC report that identifies which policies worked and which did not. I don't think we're going to see a report - because it would become an instant political hot potato.
Eviction moratoriums in 2021 - a full year after the start of the crisis are nonsensical. Individual owners such in the article will eventually lose their properties to deeper pockets - further entrenching wealth disparity.
So much of the official government response has been to support entrenched wealth. Some examples: large stores remained open, while small stores were forced to close in many regions. Financial support was provided to large businesses via PPP funding that wasn't available to small businesses. Capital subsidies of near 0% loans were extend to the largest companies (e.g. the Fed owns Apple bonds) while smaller businesses were left to die on the vine. Connected industries like airlines continue to receive bailouts.
No, the "half" aspect of the measure is the fact they didn't even try to protect small landlords. These laws were not passed by socialists, so the argument that "landlording shouldn't exist anyway" doesn't apply. It never made sense from day 1.
> Eviction moratoriums in 2021 - a full year after the start of the crisis are nonsensica
The US economy is still heavily impacted by the pandemic, and entire sectors are dead or heavily damaged ( e.g. tourism, airlines, etc.). Unemployment is at 6.3%, which is significantly more than pre-pandemic (3.5%). Not to mention all the employed with reduced income ( e.g. restaurant staff, cab drivers etc.).
What do you propose should happen to all those that are still un or underemployed ? What is the bigger problem, millions of people on the streets driven to crime, or millions of property owners losing property and/or money?
But is the second-wave of the economy coming roaring back so that people have jobs to go to in order to pay rent behind us in nearly all datasets in the United States?
Or would those people still be thrown out onto the street with no housing?
Because if there's anything we need to be doing in the United States, particularly on the West Coast, it's bringing more people to homelessness.
We should look forward and choose the best policy for the situation we have at hand, not look backwards with relief that it is getting better.
I don't mean that as an argument in favor of rent control or eviction moratoriums, it is an argument in favor of using the best basis for policy decisions.
I'd rather see the government just hand landlords money vs throwing people who may just be getting back on their feet into disarray. There has to be some point where things go back to normal, but we are at a point where 2 months from now is basically certain to be a better time to do it than right away.
You could make the exact same point towards the renters who were banking on their job to pay the rent. One is called a mortgage while the other is called rent.
There's a difference between working to eat, and investing. Investments have inherent risk, and if you can't bear that risk, don't overleverage yourself.
Reading the article, the owners aren't exactly rolling in it and are also depicted as mostly working class. If it wasn't for a global pandemic, most would have been fine and they would have thought to have invested very conservatively. In my mind, it's just that it's convenient/expedient to make them eat the cost of unpaid rent -
There are plenty of investments that are much more conservative than taking out a loan to buy real estate. Most of them don't even come with mortgage payments.
What "working class" person owns investment property in NYC? They amount of capital required to do that is so enormous that the article calling them "working class" is deeply misleading. They certainly aren't working class in the way that most NYC tenants are.
I love it. Too poor to invest in property? Working class.
Have enough money to invest in property? No longer working class.
It’s attitudes like this that prevent the working class from participating in the generation of wealth through capital. As soon as they dip their toe in, they’re now “rich” and get the rug pulled from under them.
I mean, the ownership of property - particularly land - and the use of that property to derive one's income is exactly what differentiates the working class from the ownership class. Landlords are pretty unambiguously in the latter; rent-seeking is not work.
Property management is work. Owning property is not. For small scale landlords, this is often the same person, and they may do a lot of property management.
A landlord's wealth derives from being a middleman between the tenants and the property, not from the landlord's own labor. That wealth is quite literally the whole point of being a landlord in the first place; if the income from rent didn't significantly exceed the value of the labor your FIL performs as "maintenance", then why would he bother with dealing with all the headaches of property ownership if he could instead just be an employee of the tenants themselves (said tenants forming e.g. a housing cooperative)?
That is: there's nothing a landlord does that the tenants couldn't do themselves (whether directly or by hiring someone to do it on their behalf). It is therefore not labor alone that defines the relationship between a landlord and one's tenants. Your FIL may be "the hardest working person [you] know", but he's still a middleman in the ownership class.
Sure the landlord is doing something I can’t, as a tenant, can’t do myself - if all I have is an income of a few thousand a month and I need housing, the landlord is providing me housing I couldn’t otherwise afford.
What kind of housing someone can afford is a political question. Our current answer to it is that this should be resolved through market mechanisms, which creates high prices alongside scarcity
Ain't even the market mechanisms themselves that drive the high prices; rather, it's what those market mechanisms track.
Transitioning from land prices to land rental values - i.e. gradually moving toward a 100% land value tax - would address both high prices and scarcity by taxing land consumption - and, accordingly, encouraging urban density in order to amortize that tax, thus alleviating scarcity and reducing residential expenses. Same market at play (a land value tax definitionally taxes the market value of land); vastly improved outcome.
If you're just starting out it doesn't matter if homes are $100k or $1M, you don't have money to purchase.
People act like renting is some sort of evil forced upon people, but don't realize there is a big market for renting. People don't always want to own their own housing.
There’s nothing wrong with renting, I support strong, high quality, inexpensive public housing. I don’t support private landlords and the commodification of housing.
You could pool your money with other people needing housing and collectively obtain that housing, with all y'all having equal ownership of it. This is known as a "housing cooperative" - kind of like if you rented from a corporation, but one in which you and your fellow tenants (and nobody else) are all equal shareholders.
A housing cooperative is about as economically efficient as it gets; you and your tenants would only need to pay the bare minimum to keep up with loan payments (and possibly, as I've proposed elsewhere in this thread and others, a land value tax) and maintenance, with no middlemen taking any cut out of your rent.
If I'm some early 20's person just starting out, no money to my name, I need a cheap place to rent. I don't want to own or in fact, I probably can't own.
And it's not just early 20's people. I moved to a new city for 1 year with the intent of returning. I don't want to buy anything, I want to rent.
Landlord's are providing me a service in that case - housing.
> If I'm some early 20's person just starting out, no money to my name, I need a cheap place to rent. I don't want to own or in fact, I probably can't own.
Which is exactly why it's handy to be able to pool resources with other people looking to do the same thing, thus spreading the debt (if there is any) - and the risks thereof - across multiple parties. Think of it less like a real estate purchase and more like a startup, because that's what it is.
> I moved to a new city for 1 year with the intent of returning.
In which case a housing cooperative would've served your needs just fine. Again, less like owning a home outright, and more like owning a share in a company (because, well, you would own a share in a company). And when you're done with it you can sell that share.
But I don't want to buy and sell into a cooperative. I can't pool my money, I have none beyond my paycheck. I want to rent a place. I need landlords for that.
I've heard stories about cooperatives in NYC and the bureaucracy can be a negative. It sounds like an HOA or condo board.
This seems like a great theoretical internet take and not applicable to the real world in the least.
So some 50 year old blue collar dude who saves just enough to buy a duplex and live in half of it, but can’t stop working or he’ll starve, has suddenly been propelled from the working class into the lazy, cigar-smoking, top hat twirling capital class?
If he wants to not be in that "lazy, cigar-smoking, top hat twirling capital class" (as you put it - because apparently hyperbole and gross misrepresentation of an argument counts as "discussion" on Hacker News nowadays), he is welcome to transition his ownership of that duplex into, say, a housing cooperative consisting of himself and the other half of that duplex (or - more likely - a cooperative for the land and the duplex's exterior, and retain ownership of his own unit while putting the other unit up for sale - effectively forming a COA, but cooperatively owned).
Don't put the hyperbole on me. I'm just repeating what I hear from the far left. They love to pain landlords as some evil 1%ers when in fact many are middle income people trying to get by.
And great, start a cooperative. But for everyone else who wants to rent a place, there are landlords.
The difference being that you can choose to take out a loan and buy a house, but you can't really choose not to pay rent (unless you want to be homeless of course, but that's not an option I would recommend to anyone)
Except now people are literally choosing not to pay rent. And there are no consequences. So who wins in this scenario? The landlord is screwed over, and the house is taken by the bank. Then they sell it at a loss cause its filled with a useless nonpaying tenant and that bombs all the housing prices in the neighborhood. Millions of dollars will be lost, corporations will come out ahead, and everyone is worse off. Brilliant, this moratorium.
Excuse me, but if a libertarian website tries to paint the landlords as victims by giving some extreme (but still anecdotal) examples, I'll take that with a grain of salt. Especially the first example:
>Gao discovered that one of his former tenants had given her keys to a friend who had moved in without permission. Gao has never met the squatter now living in his house and is afraid to contact this person out of fear that he'll be sued for harassment.
So it's not that the tenants were forced to stop paying rent, someone who doesn't even have a rental agreement has simply moved in, so the landlord would have every right to get them evicted, but chooses not to for... reasons?!
Do you also find it hard to sympathise with people who are trying to escape the trap of poverty? If I made assumptions about your circumstances, would I be surprised?
I really don't understand why we insulate landlords from investment risk so much. At the end of the day they can sell the place to mitigate their losses. What recourse could renters have?
As Hasan Minhaj pointed out, the result of thousands of minor landlords going bankrupt will be the further consolidation of the industry into large commercial landlords (which are worse).
I think this goes beyond simple overleveraging. For landlords, an aspect of their risk mitigation was the ability to have legal recourse for non-paying tenants:
> Weaver ... says the eviction moratorium is just a "pause" because it doesn't mean that "the landlord can never collect the rent."
> In practice, though, collecting rent money will be extraordinarily difficult after the moratorium is lifted. The case backlog in housing court could mean that landlords will wait years for their cases to be heard, and recovering large sums of money is difficult under the best of circumstances.
> Owners say that having almost no legal recourse when their tenants don't pay their rent was not part of the deal when investing in real estate. Landlord groups around the country have sued on the grounds that halting the judicial process that allows them to retake their property violates their due process rights.
I think it was reasonble for landlords to assume that, in the worst case, they may not be be able to find a renter but would at least have the ability to live in the house themself. Now they can't even do that.
I feel the same way about rent control. It's not fair for society at large to make property owners eat the cost or the lost potential income alone. I am aggressively pro rent control and pro eviction moratorium during the pandemic, but I am for a (progressive) tax to fund these programs. It's just unfair to make yourself feel good by supporting these programs when you don't have any skin in the game.
I'm not naïve though, I know that if you raise taxes to fund these programs as a society as opposed to a property owner having to fund it alone, those programs will lose their popularity. This is a case where most people's support for these programs is literally all talk. And yes, some property owners are scum and/or large corporations and people will game the system. But then you address that with oversight with teeth.
What is the moral basis of rent? Rent is by definition differentiated from service provision in that it is simply the use of a legal right to extract an income.
I don't see a moral basis, so I don't see how anything that impacts the interests of renters can be unfair. Bad on pragmatic level, perhaps, but not a moral one.
There would be a moral basis with a 100% land value tax or a property tax that approximates it.
Without it, though, rent is partially a stream of income derived from labor (upkeep, management, construction) and partially a stream of income derived from a state granted monopoly over a parcel of 4 billion year old land.
The moratorium is, in part, tacit recognition of this. Everybody knows that a large slice of rental income is completely unearned - even landlords.
I am interested in constructing new housing and renting it out, comments like yours make me wonder why I should even bother and even if I did why would I have any reason to give an antagonistic tenant any favors if it will bite me in the ass?
No, it's quite simple. Being a landlord is being a business owner. You are providing a service and in exchange you get paid enough to make construction of housing worthwhile. Except, most landlords break even and only get paid in the form of building equity. It'll take decades to pay the mortgage off.
>The moratorium is, in part, tacit recognition of this. Everybody knows that a large slice of rental income is completely unearned - even landlords.
>Few would seriously believe that the sky high rental incomes derived from these is really earned, for instance
If nobody is paying for the house then there will be no house for you to live in. It's that simple.
The moral basis comes from how the majority have agreed to structure society. A family isn't legally allowed to go to an unoccupied piece of land, start cutting down trees or making mud bricks into a shelter and stay there. We have divided up the land (a limited resource) into parcels of private ownership with government-enforced property rights.
With that comes a moral responsibility to make sure that everyone can obtain reasonable shelter. On the other side, for the person that owns the land, they provide access to what they own (as per the legal system that society has agreed upon -- private transfer of property, the banking system, etc). Not only do they provide access, they also provide the service of upkeep to the dwelling, upkeep of fixtures and security (locks, access control, etc). So it isn't like they are sitting back and collecting an income from the air that other people breath.
If you dig just a little deeper into precisely how this was done, it gets extremely ugly very fast.
The only real argument for not resetting an inequitable distribution of land ownership is that the owners of unearned privilege have a habit of defending that privilege with extreme violence.
The US invasion of Cuba subsequent to their land redistribution was one example of this.
moral basis comes from how the majority have agreed to structure society
That’s more of a rationalization than a moral foundation. The land we’re talking about (in North America), in a lot of cases, was stolen by means of violent force from the indigenous people who lived here before the arrival of European settlers. If we’re going to call that a moral basis, then we’re back to arguing the account of Thrasymachus [1] and might makes right. It’s a cynical take on justice, to be sure, but also a difficult one to counter.
I don't care about "enforcing contracts" as an abstract concept. If a contract is unjust, there is no reason it should be enforced. A contract that forces someone to pay $X a month or face homelessness during a huge economic crisis is not a just contract.
If the landlord is literally just collecting rent and doing nothing to maintain the property and not taking on associated risks and responsibilities (liability for injury and catastrophic failures like electrical fires; having to pay, primarily, state and local taxes on the property), then sure, there's absolutely nothing good about rent.
But most rents are not executed in that manner. The owner of the property is still responsible for maintaining it, is responsible for repairs if the tenant breaks something and bails, is responsible to the government for the property taxes, is responsible to the bank (or other lender) for the mortgage, is responsible for the safety of the parties inside the house, and so on. It's not a "Hey, fuck you little guy you owe me $1000/month and I don't care that you have no running water and that the lights spark when you flip that switch." situation.
I hope that eventually we will return to more predictable police power and broad taxation, as described by this quote: “The Fifth Amendment’s guarantee that private property shall not be taken for a public use without just compensation was designed to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole” (Armstrong v. United States https://supreme.justia.com/cases/federal/us/364/40/).
Another option would be a social housing program to buffer evictions and provide human rights (food and shelter are one, there's absolutely no discussion about this) to those in most difficulty.
Of course this approach will be met with howls of criticism about market distortion, having something to do with "social(ism)", and removing incentives to work hard.
Philosophically - there is a solid discussion to be had.
Where does the right to food or shelter originate?
I want to eat and I want shelter. But how and where am I going to get it? Do I have a right to compel someone else to feed and shelter me?
How does my desire for food and shelter turn into a right?
If food and shelter are a right - does it follow that it is now an obligation on someone else to provide me food and shelter? Society is just a group of individuals. Someone is going to have to build a house and someone is going to have to grow potatoes and apples. Do they have an obligation to share the product of their work with me?
I find framing things as "rights" is counterproductive. It creates all sorts of entitlement issues. I think it's better to say that society functions better - that is everyone, in total, is generally happier and healthier, if we all agree to work together to provide certain things for each other.
Forget about whether it's a right. Personally, I'd rather live in a society with free, happy people who aren't scared and desperate. I'd prefer it more than being extremely wealthy in a society where large numbers of people are barely able to scrape by. It's just overall a better experience to live in.
Agreed. Raising the floor for everyone by supporting each other is a great objective. It would be beneficial for all of us to greatly reduce food, shelter, income and healthcare insecurity.
But this isn't the way our current political discourse is going. Instead new rights are being created seemingly by the day. Voters are asked by politicians to demand their rights. If housing is a right, then some politician will eventually say that vacation homes are also a right. If employment is a right, then employment at the workplace of your choosing is a right.
If my 3 year old is about to pass away from starvation, and you walk by with a loaf of bread. I'll ask first, if you say no - I'll still be taking that bread.
Any parent would do the same. Who has a right to that bread? The person who bought it? Or the person who fought and "won" it from the other? Didn't I work just as hard to take it from you?
Is it right that a three year old die, if it could be avoided?
There was a time land was basically first come first serve claim any parcel you want and live off the toil of your labors. Lots of today's land owners I'm sure are predecessors of those first land-lords.
You feel you have a right to "peace" and that the police will protect you from crime.
If you're walking home with a bunch of junk food, and warm bread - you might see one family that salivates, maybe you can outrun them. What happens when 90% of society are those people?
Every year more people are getting pushed down into the dumps. Society is just one big social contract, I won't hurt you because I'm okay, things are good. I got food, water, heat, electric, I can't complain. I'm also too busy playing on my android phone to worry about what you have, or want to take it -- the incentive to commit a crime just isn't there...
Take away all my things, my home, my clothes, and make my kids starve and you'll see a very different version of me, probably a version I never knew existed. A lot of society is the same.
Society functions when everyone is at least "comfortable" and it degrades into anarchy and gotham city-like when everyone is relegated to squalor. If you don't believe me, consult the history books on the French Revolution and see how well it turned out for Marie Antoinette and her compadres.
Most buyers factor in Rent Control when buying the building, and so many end up using the Ellis Act (in CA) to get rid of the tenants.
We are not talking about naive buyers anymore who are blindsided by rent control.
Rent Control might be the only reason some middle class investors can afford to become landlords? Most rich guys don’t want the hassle of an Ellis Act eviction.
They just build luxury condos that only rich people can afford. (My world is San Francisco. In a more fair world, no one should tell a man what he can do with his property, but the world is not fair. Poor people don’t get many breaks.)
While I’m on my box—Sausalito is feverishly trying trying to rid Richardson Bay of Anchor-outs using underhanded tactics. They are targeting the poor people as usual. The only bright side is the victims moved to Dunphy Park because they didn’t know where to go. Sausalito tried to remove them, but someone filed a temporary restraining order with the courts.)
> It's just unfair to make yourself feel good by supporting these programs when you don't have any skin in the game.
The worst part about rent control is that there is zero accountability. Politicians pat themselves on the back for "lowering" prices without actually solving the underlying problem. The problem will only get worse over time until it becomes unbearable.
Clearly some landlords are getting hurt due to some tenants taking unethical advantage of the situation. But I think we need to wait to draw broad conclusions until this can be systematically analyzed at the macro level, rather than doing so from the one-off anecdotes in the article.
Landlords are part of the financial system. Deciding landlords must take the loss on rent so that their tenants can be safe is sensible health and social policy during the acute uncertain phase of the pandemic last year. That uncertainty is now gone.
If the government wants to house people in rental properties indefinitely, then the government can pay to do so at the prevailing market rates.
Sunk cost. They'll lose their equity stake in the property (as well as future income) if the bank forecloses on the property because the landlords aren't making mortgage payments.
Do the banks want to be in the situation of being landlords (even temporarily) of a huge number of tenants who are not or cannot pay rent? Doubtful. Does that mean they're a little less likely to foreclose on a rental property when there are lots of small landlords in this situation? Probably. Would I want to gamble a rental property on a banks reluctance to foreclose owing to the widespread nature of the problem? Absolutely not.
It honestly blows my mind that we didn't do this. It would have still been a mess, but at least in my mind a more manageable mess with less total harm.
Which of those two groups (landlords vs banks & debt holding funds) pays the most to lobbyists and campaign contributions to all parties? Sorry to be cynical but how can we not be so until it's properly cleaned up?
> Landlords are part of the financial system. Deciding landlords must take the loss on rent so that their tenants can be safe is sensible health and social policy during the acute uncertain phase of the pandemic last year. That uncertainty is now gone.
I thought the eviction moratoriums were more to avoid adding a giant homelessness crisis on top of the already-existing pandemic crisis. It was a secondary benefit that they would also help those people socially distance to help control the pandemic.
Ideally the government would have stepped in with effective programs to support existing financial relationships to avoid disruption (e.g. paying employers to keep employees on the payroll, which I think Germany did), but some people strongly believe we shouldn't have nice things like that.
I don’t understand how a waiter and a home-care provider can afford to buy a rental property that is apparently worth charging $80,000/yr in rent. I’m in the wrong business!
[edit: to be clear, this is tongue in cheek, though the circumstances where a bank made this loan seem unusual to me]
By being extremely frugal. Did you read the part of the article where the owner does not live in the house. The owner lives in a "cheap studio apartment nearby with their two young daughters". That is how!
> By being extremely frugal. Did you read the part of the article where the owner does not live in the house. The owner lives in a "cheap studio apartment nearby with their two young daughters". That is how!
You’re referring to Gao, I’m referring to Won. Different people.
>Take Won, a Chinese immigrant landlord who asked that we only use her last name. She owns a two-family house in Queens and works as a home health aide caring for an elderly couple. Her husband is a waiter at a restaurant in Manhattan's Chinatown, though he's barely been able to work since the pandemic began. Won says her tenant owes her more than $80,000 in back rent. "I just want the government to open the court," she tells Reason.
She owns a house in New York City. To put it mildly, NYC real estate is not cheap. How did she do it? Cash transaction? Is it mortgaged? Those are two very different types of ownership... but Reason makes no distinction between the two. Why? If she was on the hook for a mortgage payment, surely they would have brought it up, since it would have made her case much better. But they didn't.
The tenants owe $80,000 over a year? $6,666 a month? How big is this house? When did Won buy it? How much did she pay?
It would be two very different stories if Won had bought the place in 1970 for ten grand, versus a $2 million straw buy for a PRC upper party member. Reason doesn't want to tell us which, because it is an explicitly ideological publication, funded to promote a specific view of the world. I don't blame Reason for wanting to be the NYT of Libertarianism, but you do need to apply a degree of critical thinking to what they say.
There is absolutely zero chance a home health aide bought a house in New York City by "being frugal" any time in the 21st century. Either she bought it many decades ago, or the money came from somewhere else.
Frugal is not plausible but a straw buyer for a PRC member (and who is going to voluntarily talk to a newspaper) is? I'd argue buying in the Bronx or Brooklyn in the 80s, putting in sweat equity where possible and reaping the benefits much later is much more plausible.
FOMO? Leverage? I have a couple of anecdotal stories I know personally: a friend of a friend working in a jewelry store recently purchased a Manhattan condo as an investment that brings in around $3,000 in monthly rent.
A few years ago I was visiting Vancouver and living in an AirBnB (private room in a house) when prices were dropping, and the owner (a school teacher) was crying about how over-leveraged she was with her million-dollar-plus house, and how she was trying to get sell it, even at a loss.
I guess if you define yourself as only a "restaurant employee" and never consider doing anything else you might be right. The thing about humans is that they are flexible, adaptable, and creative and can do many different kinds of tasks.
You don't get handed a random job by the job fairy and then that's the only thing you ever get to do for the rest of your life.
Yes, and that person did not blindly consign themselves to their fate as a "restaurant employee". They acted and are also a landlord, because people are not one-dimensional characters that fill in the background in your worldview. They are people in their own right with their own ambitions and plans and are capable of directing their own lives. They don't have to live within whatever narrow conception you happen to have about their current employment.
It's much easier to earn $80k by not paying rent though. If we assume that the Chinese landlords had a well paying job they still had to spend years saving up money. A tenant can just decide to stop paying at any time if he knows he is immune from the court.
One reason why the housing market is such a shitshow is that there is antagonism between both sides. Tenants hate landlords, landlords hate tenants. Nobody will ever consider doing favors because the other side betrayed them.
Double 3/1 duplexes in Queens go for about $1M; the monthly payments on this are about $5200/month [1]. Each unit will rent for about $2700/month [2][3], so you're making a profit of about $200/month and paying down the principal steadily. You just need to cover a $200K down-payment. Minimum wage in NYC is $15/hour, so a two-earner couple working 40-hour weeks makes about $60K/year; it could be up to $90K if they each have work 12 hour days, as many Chinese immigrants do. Live in a 1BR apartment and you're spending about $15K/year on rent, maybe $25-30K/year on all expenses. You can save up for that down payment in about 4 years.
I don't have too much sympathy for them because the risk of being unable to find a tenant and hence unable to make your mortgage payment is precisely why not everybody levers up as much as possible to buy a rental property. But that's how the numbers work out. Most people on HN could probably do it, if they had the savings habits and risk tolerance of that couple.
The article is about immigrants. The parents of immigrants don't live in the U.S, so it's extremely unlikely that they got property through inheritance. (You can't apply statistical conclusions about a large group [all Americans] to individual subgroups [Chinese immigrant waiters & home-care providers] without adjusting your priors, and in this case there is a very strong prior for "parents did not own property in the U.S.")
There is nothing stopping family members in the US from gifting or passing on property to their immigrant family members, or inheriting property through marriage.
unless there is data pointing to abuse like this being widespread, I think the alternative of evicting those who can't pay rent in pandemic is still a greater sin
It's kind of a damned if you do, damned if you don't situation, isn't it?
I feel like the stimulus cheques should have been made out exclusively to people who:
1. lost a job
2. suffered a wage cut
3. suffered a significant loss of revenue
Number 3 would include landlords and freelancers. I'm one of the lucky people for whom the pandemic increased savings (by decreasing spending), so I don't think it's appropriate that I received two (!) stimulus cheques. I've donated one to Wikipedia and the other to a couple of local charities, but I'm sure there's a smarter way to redistribute that money...
Is it much exaggeration to say the message from the far left and from the establishment to those who staked all their capital on one or two rental properties is tough sh!t?
Investing in real estate is like investing in anything else: you're taking a risk and you can, in fact, lose money. Sounds like some of these landlords were irresponsible and didn't understand that before staking all their capital
Cea Weaver, who is used as a foil and whose perspective is unfairly maligned in this article, is basically 100% correct. Landlordism should not exist. Housing is a human right and should not be an investment commodity.
> Emergency policies enacted in times of crisis are prone to becoming permanent, which some members of the #CancelRent movement say is the goal.
This is a good thing. The COVID crisis has exacerbated the huge inequalities in housing in the US, and now is a better time than ever to fix things.
So, if I own an apartment / house / room, I can't go and have a contract with another person willing to take on that contract and live in my place by the agreed rules beforehand?
I believe in a world in which housing is a public good and a human right, so that no one would have to rent from anyone else in order to have access to housing. In this world, housing would cease to be a profitable investment vehicle, and thus landlordism would no longer exist.
Could I "enter in a contract" to lease "land that I own" in a national park? No, because national parks are a public good that everyone shares in their ownership and right to access. Housing should be the same way.
I don’t really get how this is possible. They should be able to take out a loan against the property to pay for any expenses, and just sell it at the end to pay off debts if they need to once this is over. They’re upset about lost income but not really struggling... Their net worth is just as high as a renter with a few hundred thousand in the bank. I would have a hard time feeling sorry for somebody in that position
You’re assuming they own the property outright with no mortgage, which is pretty unlikely. If they have a loan already the bank might not want to loan them more money against the property in the current market. And if they sell it, to who? It’ll be at a massive discount right now and they might not be able to cover the amount they owe to the bank.
> You’re assuming they own the property outright with no mortgage, which is pretty unlikely.
If they own property in New York City and were able to qualify for any sort of mortgage on a working class dual-income, then it's highly unlikely that they bought that property at any point within the last 30 years, in which case - if there was a mortgage - it should be long paid-for by now.
This is why I really like Vienna’s housing policy. They have half a million affordable housing units which are very nice. They’ve removed the private profit motive and speculation on land value that drives up housing prices. And if they needed to put a hold on rent collection, it would be the government that suffered the loss rather than private owners.
"On September 4, 2020, the Centers for Disease Control and Prevention (CDC) issued a national eviction moratorium that is currently set to expire at the end of March."
The CDC issued a moratorium?
"Won says her tenant owes her more than $80,000 in back rent. ... But we did find that the father in the family is currently employed in the construction industry, and that the tenants are renting a second apartment in a house in Queens Village, where they've also stopped paying rent and owe $12,000 to the couple that owns the house, who are also Chinese immigrants."
So they're renting two apartments and not paying for either?
It's weird that Reason didn't manage to contact any of the renters. I wonder how much effort they put in? Or I wonder if it is a hit-piece?
I have a friend who has lived in the same place for 20 years and has built a family there. They've never missed rent and have been excellent tenants, but nevertheless they're being pushed out and the property is being sold to developers. The developers are trying to intimidate my friend and hoping he doesn't know his rights and just leaves quietly - typical prisoner's dilemma final game betrayal that many property managers pull on people.
Were it not for the eviction moratorium my friend's family would have to up-end two decades of their life during a pandemic when none of them are vaccinated and one is immunocompromised, while juggling kids and trying to find a job. I understand there are some people taking advantage of these circumstances by not paying rent, but the fact is a lot of people are in pretty dire circumstances right now without many options.
Obviously this situation is also terrible for the people highlighted in this piece too and I feel for them - they worked hard and built something from nothing, and highlighting their story is important. I'm of two minds about what to feel about the broader context though, as non-residence real estate is ultimately an investment which carries risks, including unforeseen risks like pandemics. We learned quite recently in the 2008 recession that over-leveraged real estate is a systematic risk, and whether its a pandemic or a financial crisis, it's prudent that investors be able to manage a shock of at least 12 months without rent. Even absent external circumstances, a pipe could burst or another maintenance nightmare could emerge that would make an investment property uninhabitable for a long time.
Its very unfortunate that the US has such an investment-oriented view of residential real estate. In times like these, that approach pits people against each other rather than brings us together to better manage the crisis. Housing insecurity is an awful thing to have to deal with, and if everything is simultaneously quantified into 'how much am I going to make/lose', the fabric of society is going to tear.
I'm really struggling to find sympathy with the landlords in this situation.
From multiple angles:
1. Landlords already serve no real market function. They're middlemen - literal rent-seekers that offer no real service to their tenants. And somehow I'm supposed to feel bad for them?
2. The bulk of the housing shortages throughout the US (and other developed nations, for that matter) derives directly from the treatment of real estate as an investment rather than, you know, merely space to live/work/play. People buying homes (particularly low-density ones, mind you!) as "investments" are the perpetrators of that shortage, not somehow the victims; not only do they consume an outsized portion of the housing supply, but they have a vested interest in benefiting from the effects of that constrained housing supply, and therefore will logically do everything in their power to continue to constrain it because it pushes their property values higher.
3. If real estate is to be treated as an investment, then the risks of that investment must be acknowledged. Why should I feel differently about landlords who burned their savings on rental properties than I would about people who burned their savings on, say, GameStop stocks or some cryptocurrency pump-and-dump?
Like, if anything the renter demanding $12k from the landlord has a point. The very notion of land ownership externalizes opportunity costs on everyone else in a given area, specifically because land is finite / in fixed supply and therefore land ownership is definitionally zero-sum (one person's ownership of land is at the exclusion of others). Landlords are long overdue to internalize these externalized opportunity costs - specifically, through a land value tax (possibly supplemented with a flat income tax starting above some threshold; Milton Friedman was a proponent of this combined tax scheme), the proceeds of which would fund programs like UBI and single-payer healthcare to make up for those opportunity costs.
I feel for these landlords only in the sense that they're newcomers to this country hoping to find opportunities to better themselves and secure their financial future, and I hope they - alongside the rest of their fellow Americans - can get some much-needed financial support. That doesn't mean they're somehow the "good guys" in this story just because they're poor immigrants.
----
And to be clear, the delinquent renters/squatters certainly ain't the "good guys" in this story, either. Refusing to pay anything for the space one inhabits - especially when one has the means to do so - also externalizes opportunity costs onto other renters (who are now excluded from that unit despite their willingness and ability to pay for it). I might disagree strongly with the morality of a landlord extracting rent, but refusing to pay rent entirely is not the way to go about fixing that. Rather, the fix is in actually correcting the circumstances that led to this situation - namely, by forcing the internalization of externalized opportunity costs, and by replacing landlords with housing cooperatives.
>"Those are part of the costs of being a landlord," Weaver responds.
No they aren't. Landlords want to at least cover their costs. If they lose out on rental income they are forced to raise rents to compensate their loss. This will mean higher rents and a subsidy for dishonest squatters. The idea that you can make housing cheaper by making it a bad investment is hilarious. If constructing new housing is a bad investment for landlords then nobody will provide housing as a service. Everyone will have to buy their own house or condo.
>"In public housing, people are paying 30 percent of their income," Weaver told Reason. "What I am envisioning is a world in which housing is owned by a collective and people are paying 30 percent of their income in order to live in their housing. If your income is zero, you pay zero. If your income is $500,000 a year, you're paying 30 percent of that."
What makes her think that rich people can't afford to hide their income? It wouldn't surprise me if they could just start a company and simply keep the funds inside the company and only pay out as much as necessary. This is way too easy to game and the ROI is insane. If you earn 500k you would end up with 350k so by engaging in tax shenanigans you could increase your income by 40%. Who's insane enough to not do that?
>When asked how the federal government could afford such a program, Weaver told Reason that it could "print" the money.
No, the way the federal government will be able to afford such a program is by providing housing at cost. Subsidies aren't the right answer and outright printing money isn't it either. If you really wanted such a program you would spin it as a jobs program first with the additional housing as a bonus. By lowering unemployment you increase the number of people who can afford to pay rent. So it's a win win situation. The slow acting benefit of additional housing would take years to have an effect.
> No they aren't. Landlords want to at least cover their costs. If they lose out on rental income they are forced to raise rents to compensate their loss.
Costs don't dictate prices, the market dictates prices.
Nobody is going to pay $50 for a quart of milk just because it cost you that much to produce it.
All the land in the Bay Area was stolen from indigenous peoples as part of a pogrom of genocide. Many other areas in the United States have a similar issue. Until reparations are paid to the people who were here first, I have zero sympathy for so called "land owners".
Abraham buys land in Genesis: "For the full price let him give it to me in your presence as property for a burying place." Gen 23:9. Private property contract law is nothing new. My thought is how many of these landlords will end up turning to more nefarious means to make ends meet? It seems when the legal system fails people inevitably turn to vigilantism.
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[ 4.2 ms ] story [ 166 ms ] threadEviction moratoriums in 2021 - a full year after the start of the crisis are nonsensical. Individual owners such in the article will eventually lose their properties to deeper pockets - further entrenching wealth disparity.
How do we know that’s not the actual goal of those policies?
It is all kind of sad, really.
There is a word that describes this kind of merger of corporate and government power, I just don't seem to remember it.
The US economy is still heavily impacted by the pandemic, and entire sectors are dead or heavily damaged ( e.g. tourism, airlines, etc.). Unemployment is at 6.3%, which is significantly more than pre-pandemic (3.5%). Not to mention all the employed with reduced income ( e.g. restaurant staff, cab drivers etc.).
What do you propose should happen to all those that are still un or underemployed ? What is the bigger problem, millions of people on the streets driven to crime, or millions of property owners losing property and/or money?
Or would those people still be thrown out onto the street with no housing?
Because if there's anything we need to be doing in the United States, particularly on the West Coast, it's bringing more people to homelessness.
I don't mean that as an argument in favor of rent control or eviction moratoriums, it is an argument in favor of using the best basis for policy decisions.
I'd rather see the government just hand landlords money vs throwing people who may just be getting back on their feet into disarray. There has to be some point where things go back to normal, but we are at a point where 2 months from now is basically certain to be a better time to do it than right away.
What "working class" person owns investment property in NYC? They amount of capital required to do that is so enormous that the article calling them "working class" is deeply misleading. They certainly aren't working class in the way that most NYC tenants are.
Have enough money to invest in property? No longer working class.
It’s attitudes like this that prevent the working class from participating in the generation of wealth through capital. As soon as they dip their toe in, they’re now “rich” and get the rug pulled from under them.
A landlord's wealth derives from being a middleman between the tenants and the property, not from the landlord's own labor. That wealth is quite literally the whole point of being a landlord in the first place; if the income from rent didn't significantly exceed the value of the labor your FIL performs as "maintenance", then why would he bother with dealing with all the headaches of property ownership if he could instead just be an employee of the tenants themselves (said tenants forming e.g. a housing cooperative)?
That is: there's nothing a landlord does that the tenants couldn't do themselves (whether directly or by hiring someone to do it on their behalf). It is therefore not labor alone that defines the relationship between a landlord and one's tenants. Your FIL may be "the hardest working person [you] know", but he's still a middleman in the ownership class.
Transitioning from land prices to land rental values - i.e. gradually moving toward a 100% land value tax - would address both high prices and scarcity by taxing land consumption - and, accordingly, encouraging urban density in order to amortize that tax, thus alleviating scarcity and reducing residential expenses. Same market at play (a land value tax definitionally taxes the market value of land); vastly improved outcome.
People act like renting is some sort of evil forced upon people, but don't realize there is a big market for renting. People don't always want to own their own housing.
A housing cooperative is about as economically efficient as it gets; you and your tenants would only need to pay the bare minimum to keep up with loan payments (and possibly, as I've proposed elsewhere in this thread and others, a land value tax) and maintenance, with no middlemen taking any cut out of your rent.
If I'm some early 20's person just starting out, no money to my name, I need a cheap place to rent. I don't want to own or in fact, I probably can't own.
And it's not just early 20's people. I moved to a new city for 1 year with the intent of returning. I don't want to buy anything, I want to rent.
Landlord's are providing me a service in that case - housing.
Which is exactly why it's handy to be able to pool resources with other people looking to do the same thing, thus spreading the debt (if there is any) - and the risks thereof - across multiple parties. Think of it less like a real estate purchase and more like a startup, because that's what it is.
> I moved to a new city for 1 year with the intent of returning.
In which case a housing cooperative would've served your needs just fine. Again, less like owning a home outright, and more like owning a share in a company (because, well, you would own a share in a company). And when you're done with it you can sell that share.
I've heard stories about cooperatives in NYC and the bureaucracy can be a negative. It sounds like an HOA or condo board.
So some 50 year old blue collar dude who saves just enough to buy a duplex and live in half of it, but can’t stop working or he’ll starve, has suddenly been propelled from the working class into the lazy, cigar-smoking, top hat twirling capital class?
If he wants to not be in that "lazy, cigar-smoking, top hat twirling capital class" (as you put it - because apparently hyperbole and gross misrepresentation of an argument counts as "discussion" on Hacker News nowadays), he is welcome to transition his ownership of that duplex into, say, a housing cooperative consisting of himself and the other half of that duplex (or - more likely - a cooperative for the land and the duplex's exterior, and retain ownership of his own unit while putting the other unit up for sale - effectively forming a COA, but cooperatively owned).
And great, start a cooperative. But for everyone else who wants to rent a place, there are landlords.
>Gao discovered that one of his former tenants had given her keys to a friend who had moved in without permission. Gao has never met the squatter now living in his house and is afraid to contact this person out of fear that he'll be sued for harassment.
So it's not that the tenants were forced to stop paying rent, someone who doesn't even have a rental agreement has simply moved in, so the landlord would have every right to get them evicted, but chooses not to for... reasons?!
At least not at market prices.
This isn’t market risk. This is govt fiat that is causing the financial troubles.
https://www.youtube.com/watch?t=1030&v=MPFPBzr7FgY&feature=y...
> Weaver ... says the eviction moratorium is just a "pause" because it doesn't mean that "the landlord can never collect the rent."
> In practice, though, collecting rent money will be extraordinarily difficult after the moratorium is lifted. The case backlog in housing court could mean that landlords will wait years for their cases to be heard, and recovering large sums of money is difficult under the best of circumstances.
> Owners say that having almost no legal recourse when their tenants don't pay their rent was not part of the deal when investing in real estate. Landlord groups around the country have sued on the grounds that halting the judicial process that allows them to retake their property violates their due process rights.
I think it was reasonble for landlords to assume that, in the worst case, they may not be be able to find a renter but would at least have the ability to live in the house themself. Now they can't even do that.
I don't see a moral basis, so I don't see how anything that impacts the interests of renters can be unfair. Bad on pragmatic level, perhaps, but not a moral one.
Without it, though, rent is partially a stream of income derived from labor (upkeep, management, construction) and partially a stream of income derived from a state granted monopoly over a parcel of 4 billion year old land.
The moratorium is, in part, tacit recognition of this. Everybody knows that a large slice of rental income is completely unearned - even landlords.
Few would seriously believe that the sky high rental incomes derived from these is really earned, for instance - it's an entitlement: https://www.savingadvice.com/articles/2019/08/06/1067844_10-...
No, it's quite simple. Being a landlord is being a business owner. You are providing a service and in exchange you get paid enough to make construction of housing worthwhile. Except, most landlords break even and only get paid in the form of building equity. It'll take decades to pay the mortgage off.
>The moratorium is, in part, tacit recognition of this. Everybody knows that a large slice of rental income is completely unearned - even landlords.
>Few would seriously believe that the sky high rental incomes derived from these is really earned, for instance
If nobody is paying for the house then there will be no house for you to live in. It's that simple.
With that comes a moral responsibility to make sure that everyone can obtain reasonable shelter. On the other side, for the person that owns the land, they provide access to what they own (as per the legal system that society has agreed upon -- private transfer of property, the banking system, etc). Not only do they provide access, they also provide the service of upkeep to the dwelling, upkeep of fixtures and security (locks, access control, etc). So it isn't like they are sitting back and collecting an income from the air that other people breath.
If you dig just a little deeper into precisely how this was done, it gets extremely ugly very fast.
The only real argument for not resetting an inequitable distribution of land ownership is that the owners of unearned privilege have a habit of defending that privilege with extreme violence.
The US invasion of Cuba subsequent to their land redistribution was one example of this.
That’s more of a rationalization than a moral foundation. The land we’re talking about (in North America), in a lot of cases, was stolen by means of violent force from the indigenous people who lived here before the arrival of European settlers. If we’re going to call that a moral basis, then we’re back to arguing the account of Thrasymachus [1] and might makes right. It’s a cynical take on justice, to be sure, but also a difficult one to counter.
[1] https://iep.utm.edu/thrasymachus/
But most rents are not executed in that manner. The owner of the property is still responsible for maintaining it, is responsible for repairs if the tenant breaks something and bails, is responsible to the government for the property taxes, is responsible to the bank (or other lender) for the mortgage, is responsible for the safety of the parties inside the house, and so on. It's not a "Hey, fuck you little guy you owe me $1000/month and I don't care that you have no running water and that the lights spark when you flip that switch." situation.
Of course this approach will be met with howls of criticism about market distortion, having something to do with "social(ism)", and removing incentives to work hard.
Where does the right to food or shelter originate?
I want to eat and I want shelter. But how and where am I going to get it? Do I have a right to compel someone else to feed and shelter me?
How does my desire for food and shelter turn into a right?
If food and shelter are a right - does it follow that it is now an obligation on someone else to provide me food and shelter? Society is just a group of individuals. Someone is going to have to build a house and someone is going to have to grow potatoes and apples. Do they have an obligation to share the product of their work with me?
Forget about whether it's a right. Personally, I'd rather live in a society with free, happy people who aren't scared and desperate. I'd prefer it more than being extremely wealthy in a society where large numbers of people are barely able to scrape by. It's just overall a better experience to live in.
But this isn't the way our current political discourse is going. Instead new rights are being created seemingly by the day. Voters are asked by politicians to demand their rights. If housing is a right, then some politician will eventually say that vacation homes are also a right. If employment is a right, then employment at the workplace of your choosing is a right.
Oh come on, slippery slopes aren’t valid arguments.
Any parent would do the same. Who has a right to that bread? The person who bought it? Or the person who fought and "won" it from the other? Didn't I work just as hard to take it from you?
Is it right that a three year old die, if it could be avoided?
There was a time land was basically first come first serve claim any parcel you want and live off the toil of your labors. Lots of today's land owners I'm sure are predecessors of those first land-lords.
You feel you have a right to "peace" and that the police will protect you from crime.
If you're walking home with a bunch of junk food, and warm bread - you might see one family that salivates, maybe you can outrun them. What happens when 90% of society are those people?
Every year more people are getting pushed down into the dumps. Society is just one big social contract, I won't hurt you because I'm okay, things are good. I got food, water, heat, electric, I can't complain. I'm also too busy playing on my android phone to worry about what you have, or want to take it -- the incentive to commit a crime just isn't there...
Take away all my things, my home, my clothes, and make my kids starve and you'll see a very different version of me, probably a version I never knew existed. A lot of society is the same.
Society functions when everyone is at least "comfortable" and it degrades into anarchy and gotham city-like when everyone is relegated to squalor. If you don't believe me, consult the history books on the French Revolution and see how well it turned out for Marie Antoinette and her compadres.
We are not talking about naive buyers anymore who are blindsided by rent control.
Rent Control might be the only reason some middle class investors can afford to become landlords? Most rich guys don’t want the hassle of an Ellis Act eviction.
They just build luxury condos that only rich people can afford. (My world is San Francisco. In a more fair world, no one should tell a man what he can do with his property, but the world is not fair. Poor people don’t get many breaks.)
While I’m on my box—Sausalito is feverishly trying trying to rid Richardson Bay of Anchor-outs using underhanded tactics. They are targeting the poor people as usual. The only bright side is the victims moved to Dunphy Park because they didn’t know where to go. Sausalito tried to remove them, but someone filed a temporary restraining order with the courts.)
The worst part about rent control is that there is zero accountability. Politicians pat themselves on the back for "lowering" prices without actually solving the underlying problem. The problem will only get worse over time until it becomes unbearable.
If the government wants to house people in rental properties indefinitely, then the government can pay to do so at the prevailing market rates.
Do the banks want to be in the situation of being landlords (even temporarily) of a huge number of tenants who are not or cannot pay rent? Doubtful. Does that mean they're a little less likely to foreclose on a rental property when there are lots of small landlords in this situation? Probably. Would I want to gamble a rental property on a banks reluctance to foreclose owing to the widespread nature of the problem? Absolutely not.
Too-big-to-fail banks eat some temporary losses, small landlords don't lose their shirts, and rent still gets effectively canceled.
I thought the eviction moratoriums were more to avoid adding a giant homelessness crisis on top of the already-existing pandemic crisis. It was a secondary benefit that they would also help those people socially distance to help control the pandemic.
Ideally the government would have stepped in with effective programs to support existing financial relationships to avoid disruption (e.g. paying employers to keep employees on the payroll, which I think Germany did), but some people strongly believe we shouldn't have nice things like that.
I don't want to be "systematically analyzed" to determine if wrongs done to me are "acceptable".
That sort of thought is a path that leads straight to tyranny.
[edit: to be clear, this is tongue in cheek, though the circumstances where a bank made this loan seem unusual to me]
You’re referring to Gao, I’m referring to Won. Different people.
Let us closely examine the text.
>Take Won, a Chinese immigrant landlord who asked that we only use her last name. She owns a two-family house in Queens and works as a home health aide caring for an elderly couple. Her husband is a waiter at a restaurant in Manhattan's Chinatown, though he's barely been able to work since the pandemic began. Won says her tenant owes her more than $80,000 in back rent. "I just want the government to open the court," she tells Reason.
She owns a house in New York City. To put it mildly, NYC real estate is not cheap. How did she do it? Cash transaction? Is it mortgaged? Those are two very different types of ownership... but Reason makes no distinction between the two. Why? If she was on the hook for a mortgage payment, surely they would have brought it up, since it would have made her case much better. But they didn't.
The tenants owe $80,000 over a year? $6,666 a month? How big is this house? When did Won buy it? How much did she pay?
It would be two very different stories if Won had bought the place in 1970 for ten grand, versus a $2 million straw buy for a PRC upper party member. Reason doesn't want to tell us which, because it is an explicitly ideological publication, funded to promote a specific view of the world. I don't blame Reason for wanting to be the NYT of Libertarianism, but you do need to apply a degree of critical thinking to what they say.
There is absolutely zero chance a home health aide bought a house in New York City by "being frugal" any time in the 21st century. Either she bought it many decades ago, or the money came from somewhere else.
A few years ago I was visiting Vancouver and living in an AirBnB (private room in a house) when prices were dropping, and the owner (a school teacher) was crying about how over-leveraged she was with her million-dollar-plus house, and how she was trying to get sell it, even at a loss.
You don't get handed a random job by the job fairy and then that's the only thing you ever get to do for the rest of your life.
One reason why the housing market is such a shitshow is that there is antagonism between both sides. Tenants hate landlords, landlords hate tenants. Nobody will ever consider doing favors because the other side betrayed them.
Double 3/1 duplexes in Queens go for about $1M; the monthly payments on this are about $5200/month [1]. Each unit will rent for about $2700/month [2][3], so you're making a profit of about $200/month and paying down the principal steadily. You just need to cover a $200K down-payment. Minimum wage in NYC is $15/hour, so a two-earner couple working 40-hour weeks makes about $60K/year; it could be up to $90K if they each have work 12 hour days, as many Chinese immigrants do. Live in a 1BR apartment and you're spending about $15K/year on rent, maybe $25-30K/year on all expenses. You can save up for that down payment in about 4 years.
I don't have too much sympathy for them because the risk of being unable to find a tenant and hence unable to make your mortgage payment is precisely why not everybody levers up as much as possible to buy a rental property. But that's how the numbers work out. Most people on HN could probably do it, if they had the savings habits and risk tolerance of that couple.
[1] https://www.zillow.com/homedetails/17520-Baisley-Blvd-Jamaic...
[2] https://www.zillow.com/homedetails/131-19-134th-St-South-Ozo...
[3] https://www.zillow.com/homedetails/180-05-90th-Ave-FLOOR-1-J...
[1] https://www.washingtonpost.com/us-policy/2019/02/06/people-l...
I feel like the stimulus cheques should have been made out exclusively to people who:
1. lost a job
2. suffered a wage cut
3. suffered a significant loss of revenue
Number 3 would include landlords and freelancers. I'm one of the lucky people for whom the pandemic increased savings (by decreasing spending), so I don't think it's appropriate that I received two (!) stimulus cheques. I've donated one to Wikipedia and the other to a couple of local charities, but I'm sure there's a smarter way to redistribute that money...
Also Carroll Quigley, mentor of Bill Clinton, expressed shocking disdain toward the bourgeoisie in Tragedy and Hope. https://www.amazon.com/Tragedy-Hope-History-World-Time/dp/09...
Is it much exaggeration to say the message from the far left and from the establishment to those who staked all their capital on one or two rental properties is tough sh!t?
> Emergency policies enacted in times of crisis are prone to becoming permanent, which some members of the #CancelRent movement say is the goal.
This is a good thing. The COVID crisis has exacerbated the huge inequalities in housing in the US, and now is a better time than ever to fix things.
So, if I own an apartment / house / room, I can't go and have a contract with another person willing to take on that contract and live in my place by the agreed rules beforehand?
Could I "enter in a contract" to lease "land that I own" in a national park? No, because national parks are a public good that everyone shares in their ownership and right to access. Housing should be the same way.
> working-class landlords
lol
If they own property in New York City and were able to qualify for any sort of mortgage on a working class dual-income, then it's highly unlikely that they bought that property at any point within the last 30 years, in which case - if there was a mortgage - it should be long paid-for by now.
https://www.huduser.gov/portal/pdredge/pdr_edge_featd_articl...
The CDC issued a moratorium?
"Won says her tenant owes her more than $80,000 in back rent. ... But we did find that the father in the family is currently employed in the construction industry, and that the tenants are renting a second apartment in a house in Queens Village, where they've also stopped paying rent and owe $12,000 to the couple that owns the house, who are also Chinese immigrants."
So they're renting two apartments and not paying for either?
It's weird that Reason didn't manage to contact any of the renters. I wonder how much effort they put in? Or I wonder if it is a hit-piece?
Were it not for the eviction moratorium my friend's family would have to up-end two decades of their life during a pandemic when none of them are vaccinated and one is immunocompromised, while juggling kids and trying to find a job. I understand there are some people taking advantage of these circumstances by not paying rent, but the fact is a lot of people are in pretty dire circumstances right now without many options.
Obviously this situation is also terrible for the people highlighted in this piece too and I feel for them - they worked hard and built something from nothing, and highlighting their story is important. I'm of two minds about what to feel about the broader context though, as non-residence real estate is ultimately an investment which carries risks, including unforeseen risks like pandemics. We learned quite recently in the 2008 recession that over-leveraged real estate is a systematic risk, and whether its a pandemic or a financial crisis, it's prudent that investors be able to manage a shock of at least 12 months without rent. Even absent external circumstances, a pipe could burst or another maintenance nightmare could emerge that would make an investment property uninhabitable for a long time.
Its very unfortunate that the US has such an investment-oriented view of residential real estate. In times like these, that approach pits people against each other rather than brings us together to better manage the crisis. Housing insecurity is an awful thing to have to deal with, and if everything is simultaneously quantified into 'how much am I going to make/lose', the fabric of society is going to tear.
From multiple angles:
1. Landlords already serve no real market function. They're middlemen - literal rent-seekers that offer no real service to their tenants. And somehow I'm supposed to feel bad for them?
2. The bulk of the housing shortages throughout the US (and other developed nations, for that matter) derives directly from the treatment of real estate as an investment rather than, you know, merely space to live/work/play. People buying homes (particularly low-density ones, mind you!) as "investments" are the perpetrators of that shortage, not somehow the victims; not only do they consume an outsized portion of the housing supply, but they have a vested interest in benefiting from the effects of that constrained housing supply, and therefore will logically do everything in their power to continue to constrain it because it pushes their property values higher.
3. If real estate is to be treated as an investment, then the risks of that investment must be acknowledged. Why should I feel differently about landlords who burned their savings on rental properties than I would about people who burned their savings on, say, GameStop stocks or some cryptocurrency pump-and-dump?
Like, if anything the renter demanding $12k from the landlord has a point. The very notion of land ownership externalizes opportunity costs on everyone else in a given area, specifically because land is finite / in fixed supply and therefore land ownership is definitionally zero-sum (one person's ownership of land is at the exclusion of others). Landlords are long overdue to internalize these externalized opportunity costs - specifically, through a land value tax (possibly supplemented with a flat income tax starting above some threshold; Milton Friedman was a proponent of this combined tax scheme), the proceeds of which would fund programs like UBI and single-payer healthcare to make up for those opportunity costs.
I feel for these landlords only in the sense that they're newcomers to this country hoping to find opportunities to better themselves and secure their financial future, and I hope they - alongside the rest of their fellow Americans - can get some much-needed financial support. That doesn't mean they're somehow the "good guys" in this story just because they're poor immigrants.
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And to be clear, the delinquent renters/squatters certainly ain't the "good guys" in this story, either. Refusing to pay anything for the space one inhabits - especially when one has the means to do so - also externalizes opportunity costs onto other renters (who are now excluded from that unit despite their willingness and ability to pay for it). I might disagree strongly with the morality of a landlord extracting rent, but refusing to pay rent entirely is not the way to go about fixing that. Rather, the fix is in actually correcting the circumstances that led to this situation - namely, by forcing the internalization of externalized opportunity costs, and by replacing landlords with housing cooperatives.
No they aren't. Landlords want to at least cover their costs. If they lose out on rental income they are forced to raise rents to compensate their loss. This will mean higher rents and a subsidy for dishonest squatters. The idea that you can make housing cheaper by making it a bad investment is hilarious. If constructing new housing is a bad investment for landlords then nobody will provide housing as a service. Everyone will have to buy their own house or condo.
>"In public housing, people are paying 30 percent of their income," Weaver told Reason. "What I am envisioning is a world in which housing is owned by a collective and people are paying 30 percent of their income in order to live in their housing. If your income is zero, you pay zero. If your income is $500,000 a year, you're paying 30 percent of that."
What makes her think that rich people can't afford to hide their income? It wouldn't surprise me if they could just start a company and simply keep the funds inside the company and only pay out as much as necessary. This is way too easy to game and the ROI is insane. If you earn 500k you would end up with 350k so by engaging in tax shenanigans you could increase your income by 40%. Who's insane enough to not do that?
>When asked how the federal government could afford such a program, Weaver told Reason that it could "print" the money.
No, the way the federal government will be able to afford such a program is by providing housing at cost. Subsidies aren't the right answer and outright printing money isn't it either. If you really wanted such a program you would spin it as a jobs program first with the additional housing as a bonus. By lowering unemployment you increase the number of people who can afford to pay rent. So it's a win win situation. The slow acting benefit of additional housing would take years to have an effect.
Costs don't dictate prices, the market dictates prices.
Nobody is going to pay $50 for a quart of milk just because it cost you that much to produce it.
Why should banks expect payments to continue as if nothing happened when large parts of the economy have been forced to close?