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by zootam
2534 days ago
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Is there a plan for Universal Rent Control? I am skeptical of how this may work out in practice. Given rates of homeownership/rent in metropolitan areas without rent control, wouldn't this result in a significant portion of renters (younger people especially) quickly having to pay more in rent? Thats the scenario I think about, lots of people suddenly have $12k more per year to spend, why wouldn't landlords just increase rent proportionally? |
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At a high level, UBI is a wealth transfer from the rich to the poor [1]. One extreme is that 100% of the additional wealth received by the poor goes to rent, another extreme is that 0% does. [2]. The number will probably fall someplace in the middle, along with inflation on other assets. Regardless of what asset classes see what inflation, and what the exact amount of inflation is, the bottom tier of wealth/income people will control a bigger share of buying power, which should help them in aggregate.
Returning to the housing question, there is reason to think that UBI will improve the health of housing markets. One of the major issues in housing we are seeing is economic activity being concentrated in a few wealthy areas, driving up local housing prices. In addition to being a wealth transfer on an individual level, UBI is also a wealth transfer on a geographical level, where money goes from the few rich centers to the less rich areas. On the margins, this will cause people to move away from the high-demand areas and into the low-demand areas. I doubt this force will be strong enough to fix all of our housing markets, but I would expect it to help.
[0] Although it can work as a policy to shift market risks from the renter to the landlord; which may be worth doing.
[1] Assuming a rational funding system.
[2] Conceivably, the numbers could pass either bound, but I think that possibility falls clearly in the 'you need more specific justification; bucket.