To get straight to the point, millions of Americans will only ever dream about owning a home. Now while there are many different reasons for the high cost of homes, I believe that the biggest one is due to hoarding. Countless property owners own more houses than they need to live simply to make a profit on those properties. This in turn feeds the shortage of houses on the market and inflates the prices of what little available housing there is.
My solution to this problem is one simple law that will apply to every state. Every non commercial property that is rented in the united states may not have a yearly total rent price that exceeds the property taxes of that property.
With this simple law, it will no longer be profitable to own more than one house and as maintenence costs pile up, people who own multiple properties with the sole purpose of collecting checks every month will be encouraged to put those properties back into rotation on the housing market. This in turn will lower the average cost of a home accross the country and will inevitability stimulate the economy.
Im open to additional ideas, I know that corporations buying up properties and land is major problem as well, but I am not as knowledgeable in that area to offer ideas for it and my own idea is not perfect either, it definitely needs fleshed out. I would consider hotels exempt from this policy, the wordage would have to do with the amount of rooms offered and the length of stays provided to be eligible for this exemption. This wordage would be there to specifically not include businesses like trailer parks, condo lots, air bnbs etc. Open to improvements. Not open to angry replies from people who leech off the economy for self gain.
I’m all for preventing corporations and banks from buying up housing and then renting them out Scott free, I believe they should be rent capped( however they will find loopholes into any policy passed covering this) , however I do not agree we should be rent capping houses owned by private citizens who have worked hard for a second house that they may be renting out until their child can own it, or having a vacation home they rent out 9 months of the year. They are asset investments that should be allowed to rent at any price, the market will determine if they can successfully rent them out or not. The rent prices are indicative of housing availability and the rent cost will fluctuate accordingly. One issue i’ve always had with apartment complexes is they get checks from the government covering the difference between what they charge a low income renter vs what they charge normally, so apartment complexes are incentivized to increase rent costs and fill them with more people making less than a certain amount. I know this is happening because I have seen it first hand. These programs have good intentions but it ends up hurting more people than helping. A place that’s rents for 2000 a month we were told we could rent for 1000 if our income was below 40k combined and because at the time we had 45k combined we had to pay the 2000. The government pays them the difference a month per qualified renter. It’s for sure had a hand in raising overall rent costs for everyone.
I have no problem with someone owning a second home or a vacation home. This policy wouldnt even prevent them from renting it out for part of the year to cover taxes. The only thing this policy does is terminate making land and house ownership a business model. This policy would not stop you from renting a secondary home to your children, it would merely prevent you from making any money while doing so.
Buying up homes to rent out is a one sided business plan that only benefits the land owner and makes every aspect of buying a house worse for the everday american. Economicaly this business model only removes from the market and drives prices up for everyone. All the money made off this venture sits in a retirement account for decades and doesnt stimulate the economy because its not being spent. At the end of the day, hoarding properties and collecting checks every month from people who dont qualify for a bank loan is at the very least, an unethical way to live.
Gotcha, I Understand . However I think we should look at it from a different perspective, instead of policies directed at hurting the people fortunate enough to profit off this, find potential policies for people who need the housing to no longer rely on those people who have all these properties as a business. Indirectly forcing them to lower rent and or sell the properties. I don’t think price capping or setting has ever worked out the way it was initially intended. Maybe some sort of incentive to sell the homes to the renters using a rent-to-own structure? Something like this could benefit both sides
I can understand the sentiment to not want to screw over 1 party over the other, but the reality of the situation is that landlords are coming out on top in this scenario no matter what. Would it be illegal to continue thier so called “business”? Yes. It will be more beneficial to sell these extra properties now than to keep them. But even in that scenario these people are going to sell 1-10 properties that have been making them money for decades and come out with a net gain on every single one of them. And if they want to continue to invest so that they can continue their lifestyle, they now have atleast 100-200k at the bare minimum to start a REAL business That benefits their community and contributes to the economy. This law would feel like a punishment only because the amount of effort required to keep the same lifestyle is now more than zero. To literally everyone else, the cheaper housing market would be a breath of fresh air.
To put this the simplest way i can think of, purposely causing a scarsity of a necessity, isnt a business model. Its scalping. The movie “the lorax” demonstrates this exact scenario almost perfectly.
I’m not sure why you would, at some point, limit the rent to just property taxes. I suggest that after the one year (or two years), rent is limited to the cost of the monthly mortgage, property tax, HOA’s, maintenance costs and all necessary housing costs.
Other ideas I have is that instead of limiting the rent, after the one year period of time, the landlord is taxed much heavily from the rental profit he reports, to make it nonprofitable. Those taxes are then used to fund first time homebuyer programs.
Another idea is not necessarily banning rental profit, but something like: we allow landlords to evict residents, but tell landlords they can’t use our legal system/the government to collect rental profits after a certain period of time. Let the market work it out.