Except it isn't a free market. It is a heavily regulated market that favors corporations. The regulatory bodies have been corporate captured. In addition, the corporate bodies collude on things like rent, and have a near infinite runway to leave units empty.
With the collusion of corporate entities setting prices, it raises the overall market prices of properties. As small-time landlords observe the markets, they naturally also raise their prices to increase prices.
Additionally, because of corporate capture and collusion in other markets, prices broadly increase for owning property. This forces everyone who keeps rent lower to raise rents.
The way to fix this is simple. Stop the corporate collusion by making laws that make it functionally impossible.
This can be done by the following:
- tax the hell out of corporate ownership of residential properties
- an increasingly expensive multi-home tax. First home is tax free. Second has yearly taxes and those taxes exponentially increase for each additional home.
- a vacant home tax. On top of any second home taxation, for homes besides your 1 home, there should be a vacant home tax. If a home does not have a resident in it, it should be taxed. That tax should be around what it would cost to rent the unit out.
There are some other additional factors such as penalizing foreign non-resident owners, but this covers the bulk.
Being a landlord should not be easily profitable. It should be a job that you work your ass off at.
Then and only then will the free market begin to function and optimize.
Collusion on rent is a relatively new phenomenon around RealPage and is being banned. Meanwhile, regulations like rent stabilization in NYC benefit existing tenants, not landlords.
And the taxes you describe having nothing to do with collusion. Collusion is fought using anti-collusion laws. What could possibly lead you to believe that multi-home taxes would reduce corporate collusion?
Yes, obviously RealPage should be banned everywhere. But corporate capture is not the underlying economic issue at all behind high prices. Lack of supply is.
Anti-collusion laws are ineffective. Legislation that targets easier to enforce vectors with desirable side effects makes more sense.
Whether my theory on what is occurring is true or not, the proposed solution would solve it along with countless other issues, while have very little downside for anyone but a tiny group of lazy parasites.
I don't know where you're getting your ideas. None of what you say is true. You're taking some kind of bizarre ideological stance ("tiny group of lazy parasites"?) that isn't supported by any kind of evidence. You can look up the great success of many anti-collusion laws, and your solution would be economically harmful and inefficient in a large number of ways. All I can say is, I think you need to study economics more. Landlords provide a valuable service (making rental properties available to people who prefer to rent rather than buy), and they're not making extraordinary profits relative to other industries. Remember that as demand goes up, so too does the price they have to pay to acquire their properties, and therefore the mortgages they are paying to banks. If landlords made extraordinary profits relative to other businesses or investments, everybody would be rushing to become a landlord. But they aren't, because it's hard work and involves significant financial risk.
If people able to live in a home they own harms the economy, sign me up.
Houses are not investment instruments. They are spaces where people can freely exist as they are. A domain that they have full dominion in to authentically explore who they are, who they want to become, and what they want to share with others. A place to raise a family, to rest without a mask, and to be safe as they are.
Notice how I didn't mention economics at all?
Just because you have a house / houses doesn't mean others don't. Do you have any idea what it feels like to be homeless? I dare you to try it. Do you have any idea what it feels like to be a renter under the thumb of a landlord with no hope of ever having your own home?
My "policies" originate from empathy for real people. The majority of people, actually. It does not give a single shit about economics only benefiting the rich.
But that said, if you give most people the ability to have a true home, the economy will explode in activity. Instead of spending money on rent, people would spend on goods and services. They'd be happier, so they would spend money on having fun.
Making housing affordable is a no brainer.
The nice thing is, we already know what the alternative is. The economy is collapsing right now, in no small part due to the housing crisis that has been going on for a long time.
Since my policies won't be occurring now or ever, let's both sit back and enjoy the lack of these policies, and see how wonderful a world that is.
I think your attitude (landlords are the problem; we must make life harder for landlords) is a big reason housing is so expensive because it creates a situation in which not enough people with money or access to credit want to become landlords.
You say that the landlord industry has captured its regulators, but you give no example of any action or ruling by an regulator that benefits landlords at the expense of tenants.
With the collusion of corporate entities setting prices, it raises the overall market prices of properties. As small-time landlords observe the markets, they naturally also raise their prices to increase prices.
Additionally, because of corporate capture and collusion in other markets, prices broadly increase for owning property. This forces everyone who keeps rent lower to raise rents.
The way to fix this is simple. Stop the corporate collusion by making laws that make it functionally impossible.
This can be done by the following:
- tax the hell out of corporate ownership of residential properties
- an increasingly expensive multi-home tax. First home is tax free. Second has yearly taxes and those taxes exponentially increase for each additional home.
- a vacant home tax. On top of any second home taxation, for homes besides your 1 home, there should be a vacant home tax. If a home does not have a resident in it, it should be taxed. That tax should be around what it would cost to rent the unit out.
There are some other additional factors such as penalizing foreign non-resident owners, but this covers the bulk.
Being a landlord should not be easily profitable. It should be a job that you work your ass off at.
Then and only then will the free market begin to function and optimize.