Ricochet is the best place on the internet to discuss the issues of the day, either through commenting on posts or writing your own for our active and dynamic community in a fully moderated environment. In addition, the Ricochet Audio Network offers over 50 original podcasts with new episodes released every day.
Re: The Corporate Ownership of Homes
Gary Berman just oozes the sense of entitlement and arrogance that typifies globalist oligarchs. His company, Tricon Residential, owns 30,000 single-family homes in the United States and is buying more at the rate of 800 per month. His $5.5 billion corporation (and companies like his) has the resources to snap up the kind of home young families would like to buy. He says it’s OK because “Millennials don’t really want to own homes.”
I tend to disagree, as the father to three “Millennials” and the uncle to several more. Millennials would very much like to own their own homes, despite being propagandized their entire lives to disdain property, to have a preference for “experiences over possessions,” to own nothing and be happy. There are very good reasons for wanting to own property; and very good reason that the oligarchs don’t want you to.
Authoritarian Government supports the trend of large corporations owning rental properties. Corporations can do things that Government Constitutionally cannot (at least not until the left gets another one or two on the Supreme Court). Government cannot censor speech, but Big Tech is happy to on the Government’s behalf. If the Government cannot mandate you to take a vaccine, your employer can threaten to fire you if you don’t. If you protest against the Government, the courts may not allow them to freeze and confiscate your bank account, but a Government-regulated bank is only too happy to oblige.
So, imagine if a few companies owned the majority of homes in the United States. Perhaps, at the urging of regulators or elected officials, they might decide not to rent to gun owners, or people who protest at school board meetings, or people who think the maximum number of sexes is two. Democrats would love this state of affairs. Republicans — to whom corporations are blameless, holy creatures — would only respond “If you don’t like it, start your own multibillion-dollar hedge fund.”
.
Published in General
An Obama intervention in the auto industry?
Except GM etc still exist as corporations. I would expect something like HUD to actually take over ownership of all the homes owned by the collapsed corporations, and treat them as “public housing.” And I think we can all see how well that would go.
Actually, even without a more general bursting of a housing bubble, I can see these big buy-everything-in-sight corporations failing because I don’t think they’re seriously prepared for or able to support all the maintenance and such that all these houses they’re buying are going to require, going forward.
They’re going to find out, as many private landlords do, that renters don’t take care of things that they’re renting. Especially if they figure that they’re renting from a huge soul-less corporation just out for profits. And huge corporations can afford whatever damage they might inflict.
And I doubt these corporations are lining up the kinds of maintenance crews they will need to keep all these properties in rentable condition. They might have fix-up people for new acquisitions, but if they also were keeping up regular maintenance it would cut into profits. So they probably aren’t.
Something about this rubs me raw. Apartments are commercial enterprises. Heck, my cousin used to own a couple (now she’s down to one and lives in one of the units – retired). Anyway, these companies should be building or buying apartments, or even building condos. But owning a detached, single family home is the American dream for many people, and since corporations want to maximize profit, one way to do that is to vacuum up homes in an already tight market and wait for the situation to get worse – then put the homes up for sale (or rent).
I still can’t quite put my finger on exactly why I think this is wrong, but I gotta go with my gut . . .
You vill eat ze bugs, own nothing, und be happy.
– Klaus Schwab
But then why does Gary Berman get to own all those houses?
I think it will either be undone by housing market collapse, or by something like HUD taking them all over, perhaps bought out using lots of sweet, sweet taxpayer money, maybe after the amount of required maintenance gets to where Berman and the others prefer to cash out and walk away.
Toronto Millionaire CEO Becomes Internet Villain After 60 Minutes Interview.
You will own nothing and be happy.
I don’t see how that kind of “low-maintenance lifestyle” could help but be more expensive than owning it themselves, even if they paid other people to do all the upkeep for them. But if they really cared about that, they wouldn’t use Uber or want avocado toast.
It’s still true, there’s a lot of people with more money than sense. At least for now.
They want us renting.
This is one more way we get poor and the rich get richer.
They don’t have those bunkers in New Zeland for nothing
That’s because you haven’t worked the numbers. I’ll play the
World Economic Forum’sdevil’s advocate. Consider personal transportation. A personal automobile sits idle 80 to 90% of the time. This is a massively inefficient use of capital equipment. Car sharing or ride sharing are clearly more efficient and, consequently, would be cheaper to the user.This is how all these initiatives will be sold: “You can lead a worry-free existence. We will take care of all your needs while saving you money. The bugs will taste just like meat.” Left unstated: You will have to give up your autonomy and privacy.
I’m guessing this will work on most people. Buckle up.
But among other problems, ride-sharing doesn’t work large-scale because too many people need to get to work, or get home from work, at about the same time, every day. Also, many people especially in places like the People’s Republic of California, have VERY long daily commutes. Not only does this mean that their private vehicle is “in use” a lot more than 10% or 20% of the time, it also means that ride-sharing for those commutes becomes far more expensive too.
What I think a lot of this comes down to, is that even mid-level plebes thinks things like ride-sharing are only for those “beneath” THEM. Little do they know that the self-appointed elites include THEM among the “plebes.” How they will react to that when they find out, is unknown.
Taxing unrealized gains is a “wealth tax”, and has already been rejected when European countries tried it. It’s a moving target. If it gets proposed, it will not last in any bill. Single-family home sellers can sell to whomever they wish, and can reject corporate purchasers, even if it would mean they receive less for their home. I certainly would not sell my house to any corporation.
No, it’s immoral. Pricing people out of home ownership is immoral.
O ye of limited vision. The lowly physical workers will be housed in optimally efficient dwelling systems quite close to their appointed places of work. They are always free to apply to other communes during the annual open season. Meanwhile, bugs will be plentiful, and delivery will also be optimally efficient.
Yet this is exactly what happens when the government intervenes to prop up property values when times get hard. The appropriate thing would be to let the market vary so that those with a longer time preference are able to trade time for money, whether buying or selling (time the wave), rather than being beholden to the short-time, high value mania. A properly varying market would also cool the exuberance and the leverage of those who want to use it like a casino. As things stand, there is little incentive not to accept excessive risk, because once again, the alternatives are being squeezed off.
A few points that should be obvious but I guess aren’t:
Typical traffic on a Monday at 3:30 pm:
Typical traffic three hours later, at 6:30 pm:
The only advantage to owning is paying no profits to other owners, and only having to pay a one time purchase price (usually a mortgage), up-keep, and property taxes. Something tells me that the new corporate owners will be able to wring bulk property tax deals out of the counties, leaving those who rent and live in the counties to make up the lost “discounted” tax revenue though some other taxing mechanism.
Yes. Is this reliance on others to provide transportation for your daily needs like relying on next-day supply chain deliveries?
It’s really more complicated than that, still. Yes there’s heavy traffic for many hours not just at “go to work” and “leave work” times. But those time are when a lot of people do need to get to work, or get home from work. So they’ll be competing for ride-sharing with other people who need to get to work and/or go home from work, in addition to those people who just want to go to a bar or something.
Halving the “capital investment” doesn’t mean that the people who buy the vehicles used for ride-sharing, will pay less for their vehicles. (Many advocates of Uber etc seem to think like Uber doesn’t require OTHER people to own cars..) And they’ll just be getting their income – probably less of it, too – from other people using them for rides, rather than having some other job that they go to and leave from; plus they’ll be on the road a lot more hours per day which may not actually HELP the traffic problems; and they’ll be wearing out their cars at least twice as fast which means having to buy another more often… Plus Uber cars use fuel too… At maybe $10 per gallon or more…
The question I have is how leveraged are they on these houses? I bet one of the reasons is they are having less always less than 5% equity if not like almost 3%. Are these interest-only loans or are they actually paying the equity down or they just releverage? Is this just an update of claiming to have AAA debt, in reality, the underlying asset is overvalued therefore their debt can’t be AAA. Aka way more leveraged than any homeowner is even allowed to be. Plus are like the New York and other major city commercial real estate based properties. That the debt is issued on the stated future rent stream of the house not the actual cash flow. Aka if you lower the rent you will have to pony up equity because the value of the property future cash flow is now valued less? I assume they do this to get around governmental leverage requirements.
Someone really needs to detail investigative journalism on the funding mechanism and where they are getting all this money from. What is the contract like if the house loses 20 or 30% value? How is the value being assed?
That is where are they getting hundreds of billions of dollars a year to buy up single-family homes? How much you want to bet regulators are in bed and leaving the government to work for these companies?
Rob Long mentioned on a previous GLoP podcast, I think it was, that people who use regularly Uber, Lyft, We Work, and one of the home meal delivery services, were participating in billions of dollars per year of LOSSES. I wouldn’t be surprised if the corporate-house-buying thing is similar. One difference might be, what happens if/when this bubble bursts. It could mean that the people who have been renting those homes, might be able to buy them at great discounts. Or it could mean that the government buys them up and makes them a nationwide “public housing” blight.
No one is using the obvious and correct term for this phenomenon.
Fascism.
Everything is within the State, but nominally is privately owned.
That’s a good movie, but it fails to point out the source of the problem which was the government leaning on lenders to offer credit to substandard borrowers.
The book had the same defect, if I recall correctly.
Usually not with housing. The haves generally have a lot of power over zoning and the supply of new houses. Out-of-towners have no voice in the local politics of the city want to move to.
d
Is that why the last spending bill had money for 80,000 new IRS agents?
Housing discrimination laws are strong. You better be careful. How do you stop a straw purchase?
The income tax was originally pretty small. You can roughly double the 1994 dollars to get today’s numbers.
I thought about mentioning that too. Someone could easily buy a house as a “private party” and then sell it to a corporation and then THEY get the profit instead.
It’s also very damaging to civil society. In my city, neighborhoods made up primarily of home owners are the backbone of the civically active community. I know this is a broad generalization, but at least where I live, apartment dwellers do not seem to have the same commitment to the city, nor the same level of knowledge and interest in city matters. The strong neighborhood associations all seem to represent areas made up primarily of single family dwellings. The huge building of apartments going on in many cities as noted by @drewinwisconsin is, in my opinion, another blow to civic responsibility and also an invitation to political organizers of the wrong sort.
And another reason why voting should be limited to property owners.
You are failing to distinguish between car sharing and ride sharing, both of which I mentioned. Car sharing services (e.g., Zipcar) are probably more what Herr Schwab has in mind, especially since they follow the “you will own nothing” model. Uber drivers generally own their vehicles.
Maybe learn more before chiming in.
Car sharing makes even less sense to me. Especially for things like going to work and getting back home again. I know people who use car sharing, because they don’t own one themselves and use it for taking weekend trips with the kids etc. But they actually have to travel to pick up the car somewhere, by taxi or bus or something, and then have to use something else to get back home after leaving the car where they picked it up, or perhaps somewhere else. I have yet to find an explanation for how that works on a monday-to-friday go-to-work-and-go-back-home situation. Nothing like that could work without having more people just to move the cars around, at minimum. And then you get into details such as shared cars that may be unusable after a collision or other breakdown, or just because someone didn’t return it like they were supposed to, and so much more.