All in the title. You can own one home, either as a primary residence or as a rental. What happens? Does society collapse?
All in the title. You can own one home, either as a primary residence or as a rental. What happens? Does society collapse?
Housing prices would go down. Folks who can't afford to buy would be screwed cause there would be an extremely low supply of rentals.
Folks who can't afford to buy a house are screwed already, so seems like a wash. What happens to the middle class?
im not an economist wrote:
Folks who can't afford to buy a house are screwed already, so seems like a wash. What happens to the middle class?
People who can't afford to buy would be homeless in this scenario cause there would be no rentals.
But housing prices might all the sudden be come very accessible, as no one can have more than one promoting a big sell off.
This assumes a profit cannot be made by builders right? Wouldn't someone come along and make a house cheap enough for the poor person to afford?
im not an economist wrote:
All in the title. You can own one home, either as a primary residence or as a rental. What happens? Does society collapse?
This is what the fascist communist democrats want to do. Big govt tyranny is destroying our lives. Say no to Fauci! #letsgobrandon #noneedlenazis #marketsrool
Also, so say right now a poor person can afford to rent a house because we have a bunch of rentals. Can't that same person buy that exact house? Which would be made available.
Disclaimer I'm an idiot and don't know what I'm talking about.
im not an economist wrote:
Also, so say right now a poor person can afford to rent a house because we have a bunch of rentals. Can't that same person buy that exact house? Which would be made available.
Disclaimer I'm an idiot and don't know what I'm talking about.
It comes down to financing and the banks. A poor person obviously doesn't have cash to buy the house. Lets say you can afford to pay $1k month rent. $1k a month for 20 years is $240k.
Big landlords could just partner with people who don't need to exercise their ownership rights.
If you are a family of four, you have four people who each have the right to own a home, but only one person actually needs to exercise that right. The other three could essentially sell their rights to a developer by entering into a partnership agreement where they become the "owner" of one apartment unit within a large development in exchange for a fee. So I put my name on the deed to the family home, while my wife sells her right to own a home to the highest bidder. In turn, a developer who wants to build a 100 unit project simply contracts with 100 people like my wife to acquire ownership rights for 100 homes.
If everyone is allowed to own one home, that means that the limit to the number of homes that can exist in the US = the US population = ~330 million. There are currently only ~139 million housing units in the US. You are essentially capping the number of housing units that are allowed to exist at a level that is more than twice the number that currently exist. A cap that is above the current quantity doesn't do anything beyond adding some transaction costs.
im not an economist wrote:
Also, so say right now a poor person can afford to rent a house because we have a bunch of rentals. Can't that same person buy that exact house? Which would be made available.
Disclaimer I'm an idiot and don't know what I'm talking about.
Compared to most people here, you're a genius: you show intellectual humility and curiosity. Most bozos here are deadset on a belief or position based on their slavish devotion to their political tribe. Being wrong on something, or learning something that might complicate what they already believe would be akin to self-destruction for them.
partnership wrote:
Big landlords could just partner with people who don't need to exercise their ownership rights.
If you are a family of four, you have four people who each have the right to own a home, but only one person actually needs to exercise that right. The other three could essentially sell their rights to a developer by entering into a partnership agreement where they become the "owner" of one apartment unit within a large development in exchange for a fee. So I put my name on the deed to the family home, while my wife sells her right to own a home to the highest bidder. In turn, a developer who wants to build a 100 unit project simply contracts with 100 people like my wife to acquire ownership rights for 100 homes.
If everyone is allowed to own one home, that means that the limit to the number of homes that can exist in the US = the US population = ~330 million. There are currently only ~139 million housing units in the US. You are essentially capping the number of housing units that are allowed to exist at a level that is more than twice the number that currently exist. A cap that is above the current quantity doesn't do anything beyond adding some transaction costs.
Let's say for argument sake you can't do that.
Owning a home is vastly overrated. All these people who say you'll save money compared with renting are misguided amd biased. Why? Well first of all, almost all are getting a mortgage--which is the apitomy of wasting money, paying interest. And lastly, there are many costs associated with owning a home that people disregard when making the compairson that you will not incur if you rent, such as: home repairs, spending on home appliances, spending on additions or upgrades to the home, home insurance. None of these would apply when renting. If I buy a house, it will be outright. Getting a mortgage is getting suckered but I can acknowledge that for some they don't have a choice because their funds aren't adequate. It happens, no big deal.
You used to have to pay capitol gains tax on the sale of your home just like any other investment. So that meant that the government got 20% of the profit off the top. It was stifling. There were no "starter homes" for young couples, you rented until you could buy a home and you stayed there for years and years.
The GOP Congress and Clinton removed the capital gains tax from the sale of your primary residence and it has caused a boom in the housing market every since.
You have correctly identified two problems in residential real estate. First, in large cities, you have lots of very wealthy foreigners and investors buying up real estate for second homes, rental properties and AirBnBs. This pushes even people making a decent income out of the condo market and into rentals, which drives up rental prices. Then, in the suburbs, you have large private equity groups buying up houses after the 2008 market crash and holding them for rentals. These huge rental companies push up housing prices in the burbs by competing with regular buyers. There are similar pressure from house flippers who push gentrification by outbidding regular buyers and then flipping houses to higher income earners.
The problem with the OP's proposal is that it would be a taking under the US constitution and require trillions in payments to those who have to sell. It would actually be far cheaper and easier to just do what many other countries have done quite successfully. Build high quality, economically integrated social housing. Vienna is probably the best example. I also think that there needs to be a national incentive plan to help re-populate small to midsize US cities that have been completely left out by the economy of the past few decades. There are loads of rust belt towns in the midwest and East that have seen their population crash and where real estate is dirt cheap. Cleveland, OH went from a city of almost a million residents in the 1940s to under 400k most recently. And lots of towns in upstate NY have similar stories (Buffalo, Albany, Schenectady). Stop sending every college grad to Seattle, Denver, Boston, NY, etc. Get people to re-populate so many of the forgotten US cities and have a much lower cost of living and much better quality of life.
1) Prices drop because the market is flooded with new sales
2) People keep more of their money because they're not renting
3) More people have security of home ownership
4) As a result, more children are born and people have them younger - easing the future demographic aging crisis
5) Less turnover of occupants - a community develops and people are proud of it and want to improve it
6) Increase growth in the economy as money is invested in productive business and not passive property rentals
7) landlords get jobs and help ease the labor shortage!
When I was a child, few people owned more than 1 home. I think they were happier back then.
I would buy one big mega house, and then rent it at an extremely high fee so then I would never have to work again. That’s what would happen in my life.
Besides all the stuff mentioned already, there are probably many resort type areas that would not exist if one weren’t able to buy more than one home.
seikosha wrote:
Besides all the stuff mentioned already, there are probably many resort type areas that would not exist if one weren’t able to buy more than one home.
Keep in mind that if each person can own one home, a couple can own two homes. So families could still own a second home under the OP's proposal.