[offtop5]

>they can’t afford to house people for free or shoulder the country’s massive rental arrears, which could be as high as $70 billion.

I think the eviction moratorium wasn't thought out very well. You can't just stop evictions while not compensating landlords, and not developing clear plans for what happens when the moratorium ends. No one is going to catch up on their rent of their behind. What I suspect will largely happen is many landlords will forgo a formal eviction as long as the tenants decide to leave voluntarily. Then those tenants will effectively swap houses with someone else who's behind, wiping the rental debt clean. You only understand this if you've gone through an eviction, but the vast majority of the time the landlord just want you to leave. If you vacate before you actually get to court you can often avoid having the eviction on your record.

[KingMachiavelli]

The landlord could still go after the unpaid rent through the debt collection processes. That may still show up on a credit/background check.

[david38]

That’s not the same as getting paid.

That’s like saying you have the right to go after 10x more money than someone can pay off in a year. So you’re going to take 10 years to collect? This is essentially a forced loan.

Really what should have happened is the tenant gets a pause. If there are payments on the building by the landlord, those are paused as well. If it’s a small landlord who say, owns a single house, he gets federal money. This decreases as the size grows, but always enough money must be paid so that the property can be maintained. We don’t want to be creating slums.

[spamizbad]

> I think the eviction moratorium wasn't thought out very well. You can't just stop evictions while not compensating landlords

Sounds like something that's impossible to administer. How would you prevent widespread fraud - landlord's claiming their tenants aren't paying rent when in fact they are?

The US really doesn't have the bureaucratic infrastructure to handle such matters - or at least couldn't spin one up on short notice.

[wongarsu]

Yes, it's a real hassle to prevent fraud. Just giving everyone the same and without conditions is much simpler, hard to game and fairer. That's why universal basic income is such an attractive solution compared to more traditional safety nets.

[Chris2048]

How would that relate to landlords? If everyone has UBI, then everyone has more money to compete for the better rental properties. The landlord would have to get their UBI directly, and that might still not be enough.

[wongarsu]

If everyone has UBI, then people still have some money with which to pay rent (or at least pay a portion of the rent). That makes it much less likely that you need an eviction moratorium, and lessens the impact of having one.

And of course the assumption "if everyone has UBI, then everyone has more money" isn't right, since UBI as "proposed" my comment would replace other safety nets like unemployment benefits. Many people would get basically the same, just with less bureaucratic overhead. And to pay for the rest of UBI you wouldn't just print money but instead raise taxes, so you would expect the money of someone earning median income to not really change at all (depending on the exact tax scheme).

[Chris2048]

> people still have some money with which to pay rent

And as a result, money will devalue, and rents will go up. So long as UBI recipients are competing with each other over housing, that's how it will work.

> since UBI as "proposed" my comment would replace other safety nets like unemployment benefits.

If UBI is universal, why would unemployment benefits be cut? wouldn't that mean the unemployed get comparatively less?

> to pay for the rest of UBI you wouldn't just print money but instead raise taxes

The problem with this is that tax rates now follow from UBI.

Previously we might say "The tax people pay is X% of income".

Now we pay a fixed sum $Y to everyone and we need to make up for $Y * P ; where P is the size of the population.

that means the average tax payed needs to be $Y per person. This obviously can't be equally distributed (otherwise Y = 0) but now the relative tax rate depends explicitly on population size. You've just moved the goalpost by making income less relevant, and citizenship more relevant; Now every new immigrant making less than average wage, increases the tax rate for everyone making more than average wage. Instead of opposing tax rates, the wealthy will oppose immigration rates.

The benefit of not guaranteeing tax-derived UBI, is that no one has to care who enters the country, b/c it doesn't have any effect on them.

[gruez]

>If everyone has UBI, then everyone has more money to compete for the better rental properties

But people are only competing for rental properties because they need jobs, because cities are where all the jobs are. If getting a job isn't a requirement, they can move to oklahoma or something and get a cheap rental there.

[danaris]

In the short term, UBI—even a proper one that actually provides a bare minimum to live on—isn't likely to make lots of people leave their jobs for long enough to move expecting to live only off UBI. That's more likely to be a long-term process as people gain more bargaining power and the money distribution becomes more equal across the country.

[Chris2048]

I suppose this depends on whether UBI is supposed to be a form of welfare, adding a buffer against unemployment, and greasing the wheels of the economy; or if it's supposed to be a star-trekkian form of post-scarcity neo-economy.

Assuming the former; I see a big problem in that the desired outcome: "people gain more bargaining power" as unlikely so long as UBI is only a monetary pay-out.

power is relative. Universal anything can't fix that. It's like saying "everyone should be above average". If everyone got more money, money will just become less valuable. The only effect will be to piss off those with mostly monetary assets (who aren't in a position to sell-off before the change), and increase the value of non-monetary investments.

Instead, the focus should first be on the pinch-points, i.e. the scarce assets that money is intended to buy. Government housing projects, for example: leverage the large amounts of capital the government has by buying large lots of land and rapidly developing it. Create a large supply of basic housing w/ amenities, and allow this to apply market pressure naturally.

AFAIK, this is the kind of approach China is taking: large social projects for core infrastructure, high-speed national railways; entire cities built cheaply from scratch in remote areas. The large amount of capital pays off when these cities develop into more desirable locations, and unemployment/poverty is decreased.

[Chris2048]

With respect, the original post was only "universal basic income is such an attractive solution compared". You've now added a whole new element: "If getting a job isn't a requirement".

If not needing to live in the big city was the case, then that would indeed change the desirability of various properties across the market. This would be the case, with or without UBI. There's also no guarantee that "Oklahoma or something" would stay cheap if demand went up.

But big cities are desirable in other ways too (lots of common resources), plus UBI isn't necessarily so that people no longer need to work; If people move somewhere with cheap rent, but low business prospects, they'll get stuck in that situation, and a different kind of UBI-dependant poverty class with arise.

To TLDR this: this feels like the "Parable of the broken window" - The mechanics of the economy are too complex (and unintuitive) to be captured in a few speculative anecdotes, especially ones as drastic as "UBI making having a job unnecessary" - this is effectively the economic equivalent of a "toy project" - a toy argument so simple if fails to capture the complicated and significant side-effects that such a proposal with have; Needless to say, the road to hell is paved with good intensions, some of the most drastic socialistic changes have been disastrous.

[vorpalhex]

The same way you crack down on other forms of fraud? Ask for proof, bank statements, etc.

[spamizbad]

You're asking them to show proof of a null, which is tricky. For example, a landlord could tell their tenants to make the check out to their spouse, deposit rent checks into their account, then turn around to the government with their usual tenant bank account and say "They're stiffing me on rent!"

The government doesn't have perfect information.

[derekp7]

The government would still go after the tenant to potentially pay back the money that the gov fronted to the landlord (or a portion of it based on means testing). Then the tenant would have incentive to provide proof to the gov that those checks were written out. And the landlord then gets thrown into federal prison for government fraud.

[root_axis]

They could catch you retroactively when you report the rental income. Of course you could simply not report the income and hope you don't get audited but at that point you're now also guilty of tax fraud with the intent to conceal your wire fraud, and tax fraud is the type of thing the IRS can sniff out even years after the fact. There will be no plausible deniability possible since the unreported income will correspond to the defrauded payments, it'll be an open and shut case.

[Simulacra]

We don't exactly prosecute for fraud very much in this country. Otherwise we would see a lot more business owners going to jail for immigration fraud, tax fraud, and wage theft.

[swiley]

Even in the more landlord friendly states eviction is such a long process that most landlords start it the moment a tenant is late on their rent.

[rcpt]

> You can't just stop evictions while not compensating landlords

Plenty of businesses were forced to close.

[PragmaticPulp]

This would be equivalent to the government forcing those businesses to stay open and serve customers (renters) who couldn’t pay, while forbidding them from taking other customers who could pay.

[vorpalhex]

When landlords close, their tenants end up back on the streets. The goal of the program was to prevent that.

[rcpt]

Right. Eviction bans were for public health.

The government printed $9T to ensure that real estate bets didn't lose money. It worked and now housing is more expensive than ever. Landlords hit the jackpot last year.

[charonn0]

Landlords don't have even that luxury.

[homero]

There's a small amount of tenants that had the money but just stopped paying for a year. Those landlords are beyond mad.

[j_walter]

How small? With the federal benefits above and beyond unemployment...there was no reason that such a large portion of people should have been not paying rent. A friend who runs a property management company laid off 60% of his workforce (mostly maintenance guys) because 74% of his tenants stopped paying completely since last April.

[homero]

Probably a lot, I'd guess half could've paid one way or another, highly depends on the area though

[xhkkffbf]

Small? A friend who has about 5 houses told me that all 5 were behind or paying only a fraction of the rent. Including the woman who worked for Google as the local rep selling schools on using GSuite. She was making $150k when she filled out the lease paperwork. Google didn't have layoffs but somehow she couldn't write the full check. Go figure. But he still owed money to the bank and the utility company and ...

[matsemann]

It's hard to have too much sympathy for a person owning 5 houses while others are struggling having roof over their heads, though.

[TuringNYC]

I sort of sympathize with your viewpoint, but i'm curious why this doesn't extend to other human needs?

- shouldn't we also allow hungry individuals to walk out of grocery stores w/o paying for food and w/o risk of prosecution?

- shouldn't we also allow sick individuals to avoid medical debt collection and medical bankruptcies?

- shouldn't we also allow individuals to not pay tuition?

If i were to take the analogy further, shouldn't struggling businesses also get cloud hosting charges forgiven by government decree? Should public agencies in budget crises stop paying programmers salaries by government decree? Should struggling small startups stop paying software licenses by government decree?

I'm genuinely curious where the one stops and why.

[matsemann]

Of course tution should be free, and no one should have medical debt. I'm almost laughing at this being a "gotcha". Same with food and housing, it should be guaranteed by society.

But no, I don't think you should be able to walk out of a grocery with whatever you want. But the difference is a grocery provides a service, it has a function. A landlord is mostly a parasite extracting money but provides little value. if anything landlords just makes it more expensive for everyone to get a roof over their head.

[_-david-_]

Depending on when they got the houses and where they are, 5 houses may have cost less than $100k for each of them and may not be taking in that much rent.

That is less than the cost of one house in much of California now.

[ghufran_syed]

With that kind of thinking, we can soon make sure the person with 5 houses has much fewer houses, possibly 0? The problem with redistribution is that eventually you run out of other people’s money.

[Chris2048]

The person is a landlord, they are providing housing.

[matsemann]

How? By buying a house someone else could have bought and actually lived in, thus increasing the prices for everyone? How does buying and renting a house provide something not already there?

[sevenf0ur]

Not everyone is wealthy enough or wants to move into an area and buy a house. Landlords make this possible. They also keep up with all the maintenance that any homeowner is familiar with. Houses are in a constant state of decay.

[Chris2048]

> By buying a house someone else could have bought

I interpret "others are struggling having roof over their heads" as struggling to make rent, not purchase a house. If you struggle to pay the bills, it might be hard to get a mortgage.

> thus increasing the prices for everyone

The price is higher because someone else is taking on the risk. The alternative is prices are lower, but increasing the risk (and up-front cashflow requirements) for everyone.

> How does buying and renting a house provide something not already there

The house was already there to buy. Now it's there to rent. Again, I'd assume those who struggle the most are looking for rentals.

[jnwatson]

Indeed. That's why we have a civil court system though.

[prostoalex]

> Then those tenants will effectively swap houses with someone else who's behind, wiping the rental debt clean.

Won't evictions surface in credit history or background checks?

[j_walter]

There are many large cities that are blocking or restricting credit checks of renters now...so in some cases landlords will be helpless.

https://portlandrentalhomes.com/portlands-rental-screening-c...

[abfan1127]

rental costs will reflect a higher risk of doing business.

[gruez]

Or that landlords use other indicators as proxy for likeliness to repay, such your race, age, or education level. It's kind of like how "ban the box" initiatives basically made job prospects for people who are stereotyped to be criminals (eg. young black men) worse.

https://freakonomics.com/podcast/reemployment-part-1/

>DOLEAC: So we found that, on average, across the U.S., in places that ban the box, employment fell by 5 percent for young black men who didn’t have a college degree and by 3 percent for young Hispanic men who didn’t have a college degree. And so the next question is, who are they hiring instead? And we found, on average, the people who benefited were older men of color. So if you’re trying to avoid people who are actively involved in crime, older people are a pretty good bet. Criminal activity tends to decline with age.

[whatshisface]

Great, then the honest tenants have to subsidize everyone else...

[TeMPOraL]

Given this is a pandemic-induced issue, replace "honest" with "lucky" - but otherwise yeah, it seems so.

The ways risk is being distributed in society is a fascinating topic.

[whatshisface]

It's really lucky+honest, because people lucky enough to afford it don't have to pay.

[jaywalk]

Not if they're not formally evicted, which is what the OP specified in the sentence right before the one you quoted.

[tiahura]

Sure. The irony is that it won’t really matter because COVID. Landlords are desperate for cash, so they’ll wind up taking anyone with the deposit and first month’s rent - i.e. as the gp described, it will be the great deadbeat shuffle.

[jnwatson]

If a landlord nulls out the rental debt, that's completely on them. I would be quite wary renting to a person that missed 6-12 months of rent on their previous lease.

These debts are going to be chasing folks for a long time.

[cableshaft]

The pandemic made the situation a little different than usual. Many people got laid off for no fault of their own last year and couldn't find new work also from no fault of their own, the cities were just shut down for a while.

The US government decided they didn't want these people to just go homeless en masse (at least not in the middle of a pandemic) and thus put the eviction moratorium in place, thus showing that they recognize we were in an extraordinary situation.

Don't know about you, but I can't blame people for choosing not to go homeless when the government explicitly said you don't have to go homeless even if you can't pay your rent. So I wouldn't negatively judge ability to pay rent in this case if I were a landlord.

Granted, I might prefer someone who didn't get behind on payments if I had two otherwise equal applicants, but I wouldn't assume they're just not going to pay rent this time as well.

[root_axis]

Well if the landlord doesn't pursue the debt as the OP stipulates, you wouldn't really know about the missed rent.

[toomuchtodo]

Landlords call previous landlords for references. To my knowledge, there is nothing against the law in sharing missed or late rent payment information with a new landlord.

[root_axis]

This isn't very common because it's easy for tenants to lie and provide fake references or say they were living with a parent or relative, it's typically a waste of time for the landlord. Most landlords simply rely on official records like credit and background checks, proof of income etc.

[dataflow]

What viable solution would you have proposed? Keeping in mind any political constraints you would be facing in implementing it.

[GordonS]

I'm not the OP, but three things spring to mind:

1. Pause mortgage capital payments, so the landlord only needs to pay the interest - it might help somewhat

2. Or instead of (1), pause mortgage payments altogether (a "payment holiday") so there will be no negative consequences of the landlord not paying the mortgage for this time. For extra points, also freeze the accrual of interest.

3. Pay the landlords some fraction of their lost income, e.g. 50%, so they can afford to pay their mortgage lender, and won't end up getting their property taken by the bank (which would ultimately result in the tenants being evicted)

[dataflow]

I thought mortgage relief (especially for the pandemic) was already a thing? https://www.consumerfinance.gov/coronavirus/mortgage-and-hou...

[TuringNYC]

Only for GSE mortgages, and they just paused payments, didnt eliminate them (unlike rent which is essentially eliminated / uncollectible). Also, property taxes can be substantial and often higher than the mortgage depending on your area, and that wasn't addressed.

[dataflow]

> Only for GSE mortgages

Ok but GSE is the government, so it's not like the government isn't helping landlords. And what is actually happening to people with other mortgages? Are landlords failing to meet private loans and getting foreclosed as a result? Or are they getting some relief too?

> and they just paused payments, didnt eliminate them (unlike rent which is essentially eliminated / uncollectible)

I don't buy this complaint (if I understand the situation correctly). The argument was purportedly that you can't make mortgage payments without rental income, but you can't lease your home anymore because it's occupied. But when you get the relief, you don't have to make mortgage payments for that duration at all... not now, not in the future. You only pay for months that you are able to lease your home. i.e. the mortgage payments for those months are eliminated. (Right?) That seems like a much better situation than renters' as far as the mortgage payments go (who legally owe backpay rent and might now end up homeless, landlords's care to follow through notwithstanding), certainly not worse.

> Also, property taxes can be substantial and often higher than the mortgage depending on your area, and that wasn't addressed.

Also not buying this one. The stimulus + unemployment were there for landlords too. For landlords who have half a dozen homes and can't afford all of them together, I'm sure they have plenty of resources at their disposal and wouldn't face eviction or the risk of landing on their streets like many of their tenants.

[TuringNYC]

>> But when you get the relief, you don't have to make mortgage payments for that duration at all... not now, not in the future.

Not now, true. But YES in the future. Deferred payments means you still make your payments, but the whole schedule is right-shifted by 12 months.