| > I need landlords to invest their money in houses I can rent. No, you need affordable housing. There's no reason that has to double as a way for someone to make a considerable ROI. Having to rent means that even if you stay in one place long enough to pay for the cost of building/buying the house twice over, you still get to pay an ever increasing rent every month just for the service of not kicking you out of your home. > If you don't like it, it's fine, but leave the rest of us live and rent in peace. But that's the problem, isn't it? Everyone needs housing. It's not something you can simply opt out of. You can try being homeless but that precludes you from most ways to make an income. If you're wealthy enough, you can buy a house so you never have to rent again but again that's not a choice most people get to make even if they could afford it (because it hinges on their ability to get a loan, which is up to the bank). I'm not saying you should have to pay a million bucks to have a place to live. Nothing I said contradicts the idea that you may want to live in different places over time. I'm saying commodity housing (i.e. having housing subject to a housing market) necessarily leads to a housing shortage and there are better options than trusting the benevolence of every single landlord not to charge as much rent as they can get away with. > If being a landlord was so profitable and risk free, we would be drowning in properties for rent. This (drowning in properties for rent) doesn't logically follow from that (being a landlord is very profitable) and that isn't what I said. There are other factors involved like how profitable being a landlord is relative to other things you can do (like selling) and how high the initial investment required to run a profitable landlord operation (with multiple properties) is. > The fact that it doesn't happen, but we have a massive house shortage speaks by itself. If it's a housing shortage, that's a supply problem. But according to other comments from people claiming to know the situation in Spain, there is no lack of housing supply (i.e. there are plenty of houses for sale and many empty houses for rent) so it seems to be a problem of pricing. It's more profitable to sell (or rent out) a highly priced property even if it means you'll sit on it for a longer time, as long as you can afford the initial investment and maintenance. In fact, overpricing a property can be beneficial if you own other properties in the same area because it can raise the average and thus justify increasing the prices for other properties in the area. Not to mention that due to population growth over time demand goes up and new development usually happens in the outskirts, meaning supply in the area won't increase. You can be okay with the status quo. That doesn't mean there aren't good arguments why the status quo is bad in certain ways. And changing the status quo doesn't mean removing one thing and being done with it. As much as some may feel it when rent is due, I don't think the solution is to kill all landlords (or more figuratively: abolish the profit model of being a landlord). De-commodification doesn't mean simply banning the sale of something. It's about replacing one model with another and there can be intermediate steps (e.g. the Red Vienna model of public housing). |
I'll tell you why: because renting is not a risk free and safe business, but a tight one. You can have renters that doesn't pay for a couple of years. Your tenants can cause damages to your property. Your property lose value if you don't invest in it. Lots of things can go south that wipe your ROI, and you can't do nothing to fix it. Sure, if you get a long term tenant that pays every 1st day of the month and takes good care of the house, it's a wonderful business, but that is not the norm.
> Everyone needs housing. It's not something you can simply opt out of.
Same thing I need food or clothing. And I have plenty of both, cheaply, on a wide variety and quality, because politicians don't meddle with them causing artificial shortages.
> there are better options than trusting the benevolence of every single landlord not to charge as much rent as they can get away with.
That's a free market. Every single one of us charges as much as we can get away with it. And pay as less as we can get away with it. If I don't have a higher wage is just because I'm selling my work to the best paying company. In turn, they are paying my salary because they couldn't find anyone that charges less than me for the same work.
> If it's a housing shortage, that's a supply problem. But according to other comments from people claiming to know the situation in Spain, there is no lack of housing supply (i.e. there are plenty of houses for sale and many empty houses for rent) so it seems to be a problem of pricing.
That makes no economical sense. There are cities (Madrid or Barcelona, surely others) where you can put a house for rent at any price, and it will get rented in hours. That's a supply problem! A problem of pricing would be hundreds of properties for rent at such prices that nobody rent them for months or years. There is a lack or supply _for rent_, and I don't care what other "informed" comments say unless they come with data.
> It's more profitable to sell (or rent out) a highly priced property even if it means you'll sit on it for a longer time, as long as you can afford the initial investment and maintenance
What? No, it's not. Each year without renting a house that you bought for, say, 300,000€ to rent for 1,000€/month is a loss of 12,000€ (4%). If you put that same 300,000€ in stocks or some kind of safe investment like public or private bonds, you would get at least 2% interest/dividend _and your invested money_ back. Instead you have inmovilized money that is producing zero (pre tax, depretiation and amortization). You should familiarize with this concept: https://en.wikipedia.org/wiki/Opportunity_cost
You basically are saying that I can buy stocks without dividend, because I'm just going to sell it at a higher prize in the future _guaranteed_. That might happen or not.