this post was submitted on 10 Jan 2025
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Private landlords are about to get harder and harder to come by...it's about to be corpos all the way down. https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html
First house I bought was a duplex because it let me afford the mortgage. I bought a 110 year old home in disrepair and spent years of hundreds of hours and tons of my money slowly fixing up the place. I proactively do maintainence, I charge slightly below market rents, and my renters know me on a first name basis and call me for random things unrelated to the house and I'm happy to help. I respond within hours of any request, even if just to let them know when I'm off work to come fix whatever is going on.
Half the homes on my street are now owned by a single person who is trying to buy me out. He's okay, but the homes aren't super well maintained and he does his best to juice profits by cutting a few corners. He probably owns a few dozen homes. He's driving up rents through a mini local monopoly in a niche in demand area.
I compared my return on my investment to what I would have gotten if I just put the money in stocks, and the main reason it looks okay is only because the value of the houses have been driven up by these corporate investments.
I empathize so much with the frustrations with landlords here (and damn do I hate the term), but I don't see a real bridge to dealing with the problem that doesn't squeeze out people like me trying to do it right by the renters and force these properties into the hands of the corporations. Not a single person who has lived in my duplex since I bought it can afford to buy me out for what I've got in it, let alone what I could get on the open market. They've all enjoyed living there and the updates I've made, and most of them were in town for only a few years before moving (graduate students/young professionals).
Mostly just a vent. I get why people like me get demonized on here, but it's pushing out those of us trying to do it better than the rest. I've debated selling for awhile, but the next person won't be as good to the community in all likelihood. And none of the renters have been interested.
That's because of land lords. You are the problem. People could afford to buy a house on a working class income in my parent's generation. But now you're using your own price speculation as evidence that we must maintain a class of renters instead of dealing with out of control prices?
Fuck no. The government should eminent domain it all for the original price plus normal inflation and put it on the market at that price. If it's older than 50 years or has had significant changes made to the original plan then we discount it. Houses are the only product we pay more for as they fall apart and it's entirely because real estate speculation is a thing.
Totally get how you thought I was using price speculation as justification for landlords, but I was actually trying to make the opposite point. I bought this house because I wanted to own my own home, and I couldn't afford a single family home, but could half a duplex that was in such a state of disrepair when I bought it that it took me calling 12 insurance companies before one would underwrite it. It's now one of the nicer houses on the block. The point I'm trying to make is this was a terrible financial decision - I probably earned under minimum wage for the time I put into property maintance and would have earned more on the money in other investments. It's one of the only homes I could afford on the working class salary I was earning (granted, ~10 years ago).
The eminent domain strategy is an interesting one, but one that has a lot of flaws. For example, under the plan you listed I wouldn't get enough money back to pay off my mortgage with the bank - expanded economy wide, that would lead to mass lay offs across the banking sector. I could see how you might like that long term (less people working in banking), but we'd need to account for it in the short term or it would spiral the country into a recession like 2008. The house I own in is in an area not many people want to live long term and prefer renting - it's mainly graduate students and young professionals planning on moving in a few years. And how do you deal with the politics of it - the vast majority of the country, right or wrong, would never support a plan like that. And when I talk about affording it, I'm not just talking about the upfront costs. Most of my renters over the years putting down the first months payment takes some saving. I've been pricing out a new furnance and AC, and it'll run me over $8k. They couldn't afford that one time cost to keep the house maintained. These are just a couple points that could all be addressed, but mainly sharing because there are dozens more that would also need addressing and to point out that there is no simple solution to this problem.
Yeah maybe that's a bit extreme. I don't think the debt bubble would cause a bank collapse, we've had people get caught underwater before and a reduced price eminent domain would be similar to TARP in 2008. But we really do need to reign it in. And that's going to involve some people taking a bath on their loans. It's the one inescapable problem of solving housing inflation. There's always going to be X number of people who bought recently and will end up underwater. And the two answers are the government subsidizing their loan and the government forcing a sale where they would recover most of the loan. Legislation that isn't just another subsidy would likely subsidize the loan on a primary residence and force a sale to the government on other properties that are underwater and unable to be refinanced.