You run into a problem that you need to mitigate for this to work: qualifying for a mortgage.
A landlord can rent to you for a year–or less–and they assume the risk of you not paying and needing to evict you. Their income verification can be a lot more loose as a result. A bank is going to be in a relationship with you for 15-30 years; they want to be pretty sure that you’re going to be able to meet your financial obligations for that whole time period. As a result, they’re going to be quite a bit more strict about proof of income, etc.
Renting can be cheaper, too; a tenant isn’t on the hook for repairs to a unit, but when I need a new roof in my house, or the water heater goes out, I get to pay every penny of that myself. Yeah, the mortgage is cheaper, but just because you can afford the mortgage doesn’t mean that you can afford everything else that goes into owning a home.
You also get into weird and perverse tax and zoning incentives that can make it difficult to build any kind of affordable housing; Dems say they want affordable housing, right up until someone wants to put it in their neighborhood, then they start acting like Republicans.
Yes, the lack of affordable housing is a huge problem. But it’s not quite as black and white as it often seems.
They don’t assume the risk? The moment I don’t pay by the third they are threatening to evict me. They charge rent that covers their monthly mortgage payment and then some. It’s the same shit. The place I rent now is owned by progress and it’s 50/50 it seems what they cover. On top of that I have to clean it all (professionally now , that’s new) when I move out. When I moved in the place was 1700 and now it’s 2400. There’s so much risk they’re taking in renting me a place , charging rent , but not getting anything back for it.
They’re threatening to evict you, yes. But actually evicting you, in at least some states, can be challenging. I know someone that rented out his entire home (long story), and got paid about three months of rent before they quit paying. It took him nearly two years to get them out. (Last I knew he was suing the agent that vetted them; apparently there was collusion, and the tenant has done this multiple times before.)
The flip side is that if you quit paying your mortgage, it’s also going to take months or years to get you out of the house, but then the bank has a piece of real estate. Banks don’t want to own real estate; that’s not their business. They’re not set up to buy and sell real estate. Foreclosing on a house costs a bank a lot of money.
One factor that might be interesting is if renting was banned, then property values would plummet – making mortgages more affordable. But I don’t know if this would fully offset mortgage risk premiums and water heater (etc) insurance.
Renting can be cheaper, too; a tenant isn’t on the hook for repairs to a unit, but when I need a new roof in my house, or the water heater goes out, I get to pay every penny of that myself. Yeah, the mortgage is cheaper, but just because you can afford the mortgage doesn’t mean that you can afford everything else that goes into owning a home.
Don’t worry about that, landlords have figured that out. There’s a new 500 unit apartment complex that is currently being built in the Philadelphia suburbs that is taking applicants for units at the affordable price of $3500 per month.
A roof that fails on a 500-unit apartment complex will be cheaper to replace per unit than the roof an a single family home. Same with a water heater that serves multiple families rather than a single family. Honestly, it’s a good argument for communes, but communes have their own set of social problems, since it can be hard to get people to take responsibility for shit unless you go into it with the same kind of contract that you’d have when renting.
You run into a problem that you need to mitigate for this to work: qualifying for a mortgage.
A landlord can rent to you for a year–or less–and they assume the risk of you not paying and needing to evict you. Their income verification can be a lot more loose as a result. A bank is going to be in a relationship with you for 15-30 years; they want to be pretty sure that you’re going to be able to meet your financial obligations for that whole time period. As a result, they’re going to be quite a bit more strict about proof of income, etc.
Renting can be cheaper, too; a tenant isn’t on the hook for repairs to a unit, but when I need a new roof in my house, or the water heater goes out, I get to pay every penny of that myself. Yeah, the mortgage is cheaper, but just because you can afford the mortgage doesn’t mean that you can afford everything else that goes into owning a home.
You also get into weird and perverse tax and zoning incentives that can make it difficult to build any kind of affordable housing; Dems say they want affordable housing, right up until someone wants to put it in their neighborhood, then they start acting like Republicans.
Yes, the lack of affordable housing is a huge problem. But it’s not quite as black and white as it often seems.
They don’t assume the risk? The moment I don’t pay by the third they are threatening to evict me. They charge rent that covers their monthly mortgage payment and then some. It’s the same shit. The place I rent now is owned by progress and it’s 50/50 it seems what they cover. On top of that I have to clean it all (professionally now , that’s new) when I move out. When I moved in the place was 1700 and now it’s 2400. There’s so much risk they’re taking in renting me a place , charging rent , but not getting anything back for it.
They’re threatening to evict you, yes. But actually evicting you, in at least some states, can be challenging. I know someone that rented out his entire home (long story), and got paid about three months of rent before they quit paying. It took him nearly two years to get them out. (Last I knew he was suing the agent that vetted them; apparently there was collusion, and the tenant has done this multiple times before.)
The flip side is that if you quit paying your mortgage, it’s also going to take months or years to get you out of the house, but then the bank has a piece of real estate. Banks don’t want to own real estate; that’s not their business. They’re not set up to buy and sell real estate. Foreclosing on a house costs a bank a lot of money.
One factor that might be interesting is if renting was banned, then property values would plummet – making mortgages more affordable. But I don’t know if this would fully offset mortgage risk premiums and water heater (etc) insurance.
Don’t worry about that, landlords have figured that out. There’s a new 500 unit apartment complex that is currently being built in the Philadelphia suburbs that is taking applicants for units at the affordable price of $3500 per month.
A roof that fails on a 500-unit apartment complex will be cheaper to replace per unit than the roof an a single family home. Same with a water heater that serves multiple families rather than a single family. Honestly, it’s a good argument for communes, but communes have their own set of social problems, since it can be hard to get people to take responsibility for shit unless you go into it with the same kind of contract that you’d have when renting.
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