Mao was right about many things. But he was most right about Landlords.
this post was submitted on 22 Apr 2024
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Rental income is considered income, and taxed assuming reasonable tax brackets much higher than investment income (That is to say, caiptal-gains. Interest/Dividends are also taxed at the higher income rate)
The cost of maintaining a livable home, property taxes, insurance, property depreciation, and renter interactions eat into the supposed windfall that landlords make.
I'm not saying it doesn't suck sometimes and that certainly these formulas are out of whack in some situations, but there are no easy answers.
I would argue that a live-in landlord that does maintenance work or acts as a building super is in fact doing a job.
Otherwise, agreed.
I am a landlord and also have a full time job. I also spend my time fixing my units.
With the maintenance cost and taxes, I'm actually losing money or breaking even depending on the year.
My tenants are living in a house that they wouldn't be able to afford on their own in today's market. Being able to live near their work.
So why am I the bad guy?
Those people are able to live in the house you took off the market (thus driving up the price of housing) and pay off your mortgage.
Are we talking about eliminating renting altogether?
Cause that is what it sounds like in this thread. Folks wanting to completely eliminate renting and drive folks to buy a house Everytime they move.
This ignores things like closing costs, realtor fees, really high property taxes, expensive home repairs, and temporary work assignments.
Maybe you really need a job but don't want to straight up buy a house and instead rent something until you can find a job back in your local area or you decide it's time to take the plunge and move for good.
Sure there are many a-hole companies and landlords that try to squeeze their tenants for every dime and treat their tenants like crap (lord knows I've run into those), but on the other hand there are folks who need a place to live but haven't decided where they want to settle down and people who can rent their old property at a decent date based on the low interest they themselves were able to lock down.
Some are folks (like me) who moved but couldn't afford to keep their house empty for an extended period of time to put it on sale while they're paying rent or a mortgage in another state. So renting, even if you're barely breaking even, makes sense.
Better to rent your old house for barely above the costs for the property taxes, homeowners insurance, and mortgage interest, and maintenance costs than to take a 6-12 month hit where you have to pay the above while not living in the house because your new job is in a different state. And that is if you sell in 12 months and don't take a big hit on the sale.
If you're buying/selling a house every 3 years then you're really going to get screwed. I personally went from living in a home I owned (and paying a mortgage on) to renting for 3 years just to understand where I wanted to live in a new state, which areas had the best employers, and wait out on a low APR and decent buyers market.
If I had to buy a house instead of having the option to rent, then I would have ended up buying a house near that employer which would have been over an hour commute from the better job offers I got after I moved here.
Are we talking about eliminating renting altogether?
I've asked this very question before on reddit in a genuine attempt to understand what alternative the anti-landlord crowd is advocating for. Aside from the onslaught of personal attacks on my character, the best I could decipher was some sort of system where a landlord could only rent at actual cost of their mortgage, taxes, insurance, maintenance, etc. No profit could be earned. I said no one would be a landlord for free, especially considering the risks of owning land (natural disasters not insured, market crash, etc).
Their "landlords shouldn't profit off of renters" argument fell apart when I asked profit for who? Was the bank allowed to make a profit on the home loan? Was the insurance company allowed to make a profit on the policy? Could the maintenance and repair folks earn a profit on their services? Could the home remodeling companies make a profit if the home needed updating? Or is every person and entity involved in home ownership allowed to profit from the rental except the landlord? They stopped responding.
Seeing the same thing here. Apparently I'm scum because I'm renting my previous home for -10%/+10% of: mortgage on the lower price I paid 10 years ago, plus property taxes, plus home owners insurance, plus repairs and maintenance.
Apparently I would no longer be scum if I stopped renting it and refused to renew my tenants lease, sold the house and made a huge profit now, and the next person will have to pay brand new closing costs plus a mortgage on double the home value and double the APR.
I'm guessing most folks down-voting the sane responses saying rentals aren't needed have never tried selling a house (and gone 6+ months paying the mortgage for a house you no longer live in) or don't know there's a "break even" calculation that tells you how many years you have to live in the same house before you're better off than having just rented (realtor fees to sell the house, closing costs, time to sell the home where you'll still be paying your mortgage + taxes + insurance, time to close, getting credit approval for a mortgage, etc).
Hell, I did the calculation when I had to move to a new state and I was able to rent a house for less than it would have cost me to pay for closing costs and realtor fees when I would have sold the house 3 years later. Not to mention the time to come up with 20% down payment.
But fuck me for not taking the easy way out, kicking out my tenants and cashing in on the current huge property values to sell my old home.
Again: nobody is saying you're scum, they're just saying it would be better if we didn't have landlords.
But if you like to play the victim go off I guess
Maybe follow the thread?
https://lemmy.world/comment/9580949
Edit:
it doesn't make you a martyr to barely break even, it still makes you a parasite.
Idk what you meant to link to there but I saw no personal attacks
Updated with the specific quote. The sentiment of which has been echoed in this thread multiple times.
That is certainly pointed language, but they're calling landlords leaches. In the Adam Smith economic sense of the word, rent seeking is non-productive economic activity and could certainly be described as 'leaching' value.
It feels shitty to be tied to that word but they're not making a statement about your moral worth, they're making a statement about the roll you're filling.
Your question is literally answered in a sibling comment.
I'll just copy paste my response from above.
Nobody is saying to “get rid” of home rentals, but they are saying get rid of landlords.
Particularly for SFR homes, there’s no reason for a person who is not living there to ‘own’ the property and extract rent. For those who are transient -as you described- there are community land trusts, cooperative housing, limited equity housing coops, and municipal housing that can all fill the role that would traditionally be done by private landlords. Those of us who advocate eliminating private home rental’s for profit do so knowing it wouldn’t happen by choice, and that alternate arrangements for housing would need to be established alongside any legislation that bans for-profit rentals.
Private landlords are systemically problematic because it inflates home values and locks an increasing portion of the population from the option of building equity (or benefiting from community equity, as it were). Nobody is saying you’re a bad person, only that landlords (the category of private capital ownership that collects rent for the use of property) are perpetuating a huge problem and ought to be banned as a matter of benefiting society as a whole. Just like how towns or neighborhoods are democratically governed, homes should be too.
You still didn't answer the question. So get rid of the landlords means what exactly? You realize there's about two dozen or so industries whose entire commercial existence is tied to landlords and rental properties, right? Do we get rid of all of them? Or just some? Or just the landlord, who is one small cog in a very big capitalist renting wheel?
Everyone is so oddly and furiously fixated on the landlord as some sort of big bad, and therefore assert that getting rid of the landlord position entirely will just magically make everything awesome. It's odd to observe otherwise intelligent people stop so outrageously short of the complete picture.
You still didn’t answer the question.
Actually, I think I did, you just didn't understand it. What we mean by 'landlord' can be essentially boiled down to 'private ownership'. The problem with landlords as a class is that they exert complete control over a 'property' while having the least use of it. When Adam Smith wrote about 'rent extraction', he was specifically identifying a portion of an economy that was unproductive.
Landlords are defined by their ownership; they could also maintain the property, but what makes them 'landlords' and not 'maintinence workers' is their ownership over a property someone else is using and charging rent for that use. The other arrangements I listed in my previous comment address that inefficiency by democratizing the use of that asset, instead of allowing the monopoly of the landlord.
It’s odd to observe otherwise intelligent people stop so outrageously short of the complete picture.
I would really have to agree.
Actually, I think I did, you just didn’t understand it.
No, you didn't. And the drivel you just wrote still didn't answer the question. At this point it's clear that it's intentional.
The problem with landlords as a class is that they exert complete control over a ‘property’ while having the least use of it.
Tell me you have no idea how property ownership works without telling me you have no idea how property ownership works.
I would really have to agree.
"No you". Nice one. Good luck friend, this back and forth is pointless.
Good luck yourself.
Housing should be socialised, with any profits being put back into expanding housing stock.
Whose profits? See my post above:
profit for who? Was the bank allowed to make a profit on the home loan? Was the insurance company allowed to make a profit on the policy? Could the maintenance and repair folks earn a profit on their services? Could the home remodeling companies make a profit if the home needed updating? Or is every person and entity involved in home ownership allowed to profit from the rental except the landlord?
If your answer is "anyone and any entity making a profit", then that's about two or three dozen different industries (including banks, insurance agencies, title companies, all kinds of home builders, repair folks, etc.). Regardless of my opinion on that argument, your problem isn't with the landlord, it's with a huge swatch of industries who are all tied to and profit from renting.
including banks, insurance agencies, title companies, all kinds of home builders, repair folks
It's only the profit derived from ownership that's of concern here, none of these other industries (aside from the bank, arguably) apply to the critique.
Nobody is saying to "get rid" of home rentals, but they are saying get rid of landlords.
Particularly for SFR homes, there's no reason for a person who is not living there to 'own' the property and extract rent. For those who are transient -as you described- there are community land trusts, cooperative housing, limited equity housing coops, and municipal housing that can all fill the role that would traditionally be done by private landlords. Those of us who advocate eliminating private home rental's for profit do so knowing it wouldn't happen by choice, and that alternate arrangements for housing would need to be established alongside any legislation that bans for-profit rentals.
Private landlords are systemically problematic because it inflates home values and locks an increasing portion of the population from the option of building equity (or benefiting from community equity, as it were). Nobody is saying you're a bad person, only that landlords (the category of private capital ownership that collects rent for the use of property) are perpetuating a huge problem and ought to be banned as a matter of benefiting society as a whole. Just like how towns or neighborhoods are democratically governed, homes should be too.
Thanks for sharing alternatives to the status quo. See a lot of people complaining in this thread without proposing what the new system would look like. Guess it's easier to do that though
I knew I liked you.
Fuck no, just the landlords. Housing should be socialised.
Its important to remember that in your example of "barely breaking even" some poor schmuck is paying off your mortgage. So it doesn't make you a martyr to barely break even, it still makes you a parasite.
Buying house for say 100k at 3% APR, renting it because you were laid off and cant afford moving expenses, rent in a different city, plus paying a mortgage on an empty house for 6 months to a year while it sells. Then years later you still keep it because, while you could sell it and cash in, with the low APR you got on it you can afford to rent it for less than the corporate scum suckers who try to monopolize housing = Parasite
Kicking out your renters and selling said house you bought at 100k for 200k to corporate scum suckers who will turn around and sell it at an even higher price or rent it at really high rates OR someone else who will end up paying way more than the rent I was asking for the place because interest rates are about double and the house has also doubled in price = internet hero
No room for nuance, got it.
If you move or can no longer afford your house, the property should be absorbed into a community coop (or sold to them) and leased back to the tenant or a new family. You keeping ownership of the home is not a requirement, it's actually a huge problem.
The only ones insisting on the alternate scenario you just described are landlords who think of themselves as martyrs.
I don't know which particular Market you're in, but in the majority of cases, especially around me, if a bank would just fucking approve me for a loan I would pay notably less per month then I pay a landlord for rent.
And it's not like I even have a bad credit I'm in the 740s but since the fake imaginary value of properties is skyrocketed to the point that even a piece of shit falling apart house is almost a million dollars I can't get the kind of down payment they want. So despite the fact that the mortgage would literally be cheaper per month I can't get one.
And that situation exists thanks to people snapping up properties especially large companies and turning them into investment rental properties
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What do families do, that only want or need to live in a place or area for like a year or so? Buy a house, pay thousands in closing costs and inspections, lose several thousand to realtors, and then have to go through the trouble of trying to sell the place a year later?
We very much need landlords. What's screwing everything up is corpos doing it as a business or individuals with like 20 homes instead of one or two. Renting a house is a viable need for some people and it would actually suck if it was an option that didn't exist at all.
The only reason costs of houses are so high in the first place is because they are lucrative investment objects, along with the fact that the most important part of city (and rural) planning, building homes, is largely left to private companies. You are assuming houses would be just as inaffordable without landlords, which is a problem of the current paradigm and not the one proposed.
A couple of years ago, my boss' father (who founded the company and still worked there on and off) and I had a chat over lunch. I'm not sure how the topic of house prices came up, but he mentioned that when he and his wife bought their house, a car cost more than a house, so you knew that someone was really well off if they had two cars in the driveway.
I think that's the first time I've actually gotten my mind blown. The idea that a car could cost more than a house just didn't compute, and it still doesn't quite sit with me.
Of course, the general standard of houses decline the further back in time you go, but houses were a lot cheaper back in the days. Below is a figure of housing prices in Norway relative to wages at the time (mirroring the situation almost everywhere in the west):
Factoring in the increased production capabilities over the same period of time, the construction cost of houses are not that much higher. If we designed our communities better and had a better system for utilizing the increased labour power, we could have much more affordable housing and more beautiful and well functioning societies.
Do not let it sit right with you. This future was stolen from you.
There's no reason that local governments can't do this job, there's no need for middle men leaching money.
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Some of the biggest law breakers and abusive landlords are independent landlords. They're also the ones who don't seem to realize that being a landlord is a full time job where you are the handy man, maintenance, property manager, etc. It's not just collecting a cheque every month, you actually have to earn it.
But OP just said it's not a job in the meme. Which is it?
I'm not op, and the thing is that 99% of independent landlords don't do shit. I was a model tenant at my last place and I'm a handy man by trade so I would actually do every minor repair in my apartment, I would keep that place tip top and never bothered the landlord. He still thought I was a shit tenant and kicked me out as soon as he could because he wanted to charge more for the place.
Not really. I don't have to fix things on a monthly basis at my own house. When my parents rented the landlord would have to do something maybe twice a year.
The problem is that these socalled "viable needs" are treated as and acted upon like they are elective priviledges by charging exhorbitant prices for the properties that are being made available. Blaming the market for it is just passing the buck and not owning up to your own choices in what you charge. I get that the 'market' has some effect on your rates but making it the main driver for your price that reflects the cost of the entire mortgage on the property is what makes you look like a parasite. If you and your tenants shared the cost of a mortgage in a more equitable fashion, i bet there would be fewer complaints.
No, there are plenty of landlord's that are scumbags. It's emphatically not just corporations.
There are countless solutions to your problem, they just don't exist because we have landlord's.
This is a reminder that society as we know it is a mishmash at best, it's not the evolution of humanities best ideas and practices.
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Landphobia on my Lemmy? It's more likely than you think.
Folks, there's a difference between a slumlord and a decent landlord. I've owned a house for ten years now, and in addition to the mortgage and taxes and insurance I pay every month for the privelege, I've had to spend tens of thousands replacing the roof and doing other regular maintenance tasks. I'm actually about to dump thirty percent of the original purchase price into more deferred repairs and maintenance to get it back to a point where all the finished space is habitable again. Owning a house is expensive in ways that I did not fully understand until I bought mine, and decent property managers are taking care of all that for you, and if that's not a job I honestly don't know what is.
Slumlords and corporate landlords can fuck right the hell off, though.
There is no such thing as a decent landlord.
How has no comment in this thread yet mentioned Georgism or Land Value Tax? That is the solution to Landlordism
A land value tax is a good tool to help ease the transition away from landlords, but it alone is not enough.
Regardless, we definitely should be primarily relying on LVT for government income.
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