"live and thrive" rent

March 8, 2021 10:58 AM

Jo Guldi on the birth of rent control in 1881: "After decades of theory, in 1879, Irish political leaders launched a simultaneous plan of parliamentary advocacy and grassroots marches, encouraging tenants to refuse to pay rent in districts where rent had escalated. Landlords retaliated, calling upon the police to evict tenants for non-payment. Tenants, in turn, responded by organizing massive sympathy rent strikes, where even those able to pay deliberately withheld rent in solidarity with other tenants."
posted by spamandkimchi (92 comments total)

It doesn't mention that the term "boycott" comes from the ostracism of Charles Boycott, a landlord's agent who enforced the collection of these unfair rents, and was shunned by the local community, including not being served in local shops, as a result.
posted by kersplunk at 11:06 AM on March 8, 2021 [16 favorites]

Rent control is diagonal to the goal of giving everyone access to affordable housing. There is no reason I, who has a comfortable income, should have my living costs effectively subsidized by my landlord, who is an individual that bought a small apartment building that generates modest income, which is used to pay the mortgage, taxes, and upkeep. If people don't have enough money to pay for housing, let's give them money.
posted by PhineasGage at 12:42 PM on March 8, 2021 [5 favorites]

I've always felt that rent control is meant to solve two problems: 1) cost, and 2) cost uncertainty. That is, renters want affordable rent, but they also want to know that their rent won't suddenly skyrocket and become unaffordable overnight.

The first point, cost, I think is best addressed by simply building more housing and paying people fairly. The second problem is a real one though, and probably needs its own remedy. For example, by requiring lengthy advance notice of any significant rent increases.
posted by kickingtheground at 12:50 PM on March 8, 2021 [1 favorite]

It is important to realize that "rent control" can mean very different things in different US cities. In NYC rent regulated apartments can actually be "rent stabilized" or "rent controlled" and the latter is very very rare at this point (though my apartment is one of them), and doesn't even mean the same thing as it does in say, San Francisco.
posted by Pryde at 12:53 PM on March 8, 2021 [5 favorites]

my living costs effectively subsidized by my landlord, who is an individual that bought a small apartment building that generates modest income, which is used to pay the mortgage, taxes, and upkeep

The rent roll was available to the landlord before purchase. The price of the building should have reflected that. If the landlord can't handle basic economics, why should that elicit our concern, more than for his tenant?

If people don't have enough money to pay for housing, let's give them money.

...I feel like maybe you haven't thought through this scenario all the way?
posted by praemunire at 1:00 PM on March 8, 2021 [11 favorites]

If people don't have enough money to pay for housing, let's give them money.

Counterpoint: We as a society, who are in aggregate very wealthy, should not be subsidizing the profits of a narrow rentier class who add little of value to the economy compared to what they extract, but absent strong rent controls - not just real estate, but rent seeking of any stripe - universal basic income is precisely such a subsidy.
posted by mhoye at 1:22 PM on March 8, 2021 [18 favorites]

absent strong rent controls - not just real estate, but rent seeking of any stripe - universal basic income is precisely such a subsidy

To my mind, this is the single biggest problem with implementing UBI.
posted by praemunire at 1:24 PM on March 8, 2021

Counter-counterpoint: we, as a society, should avoid over-generalized, abstract thinking about my landlord, who is a non-rich human being who works very hard to maintain this building as a happily livable home for multiple people - rent seeking <> rent seeking.
posted by PhineasGage at 1:25 PM on March 8, 2021 [4 favorites]

Your landlord voluntarily entered into this arrangement as a way of seeking to profit from you and others. However hard he works, he gets paid for it. He's not running a charity. If he can't manage the business without extracting excessive profits, he shouldn't be in business.
posted by praemunire at 1:27 PM on March 8, 2021 [17 favorites]

I mean, do you have the same tender feelings for a McDonald's franchisee?
posted by praemunire at 1:28 PM on March 8, 2021 [6 favorites]

I see you've decided you get to define "excess profits." That's the whole point. It's a voluntary relationship between me and the landlord. Both sides. Like the rest of the economy. The government doesn't set McDonald's prices.
posted by PhineasGage at 1:37 PM on March 8, 2021 [1 favorite]

The context in the article is that 19thC Irish rent struggles were largely over agricultural areas, where there were higher economic uses landowners could see than small tenant farming. That emphatically doesn’t apply to modern city rents, where there’s no possible higher economic use than financialised housing—housing for rent actually crowds out more productive investment.

W/r/t the State setting hamburger prices, it’s a kinda-kinda situation. Planning is industrial policy too. Modern urban planners in high-housing cost cities actually have to protect commercial and industrial areas from encroachment by housing, to give the McDonalds franchises a chance...
posted by Fiasco da Gama at 1:42 PM on March 8, 2021 [2 favorites]

PhineasGage, are you saying that you had perfect choice in the market when it comes to finding an apartment? That there aren't any artificial distoritions? I can choose to forgo eating a hamburger and source it from somewhere else a hell of a lot easier than I can just opt out of having an home(?), which seems to be implied by the idea that it's "voluntary".
posted by sagc at 1:47 PM on March 8, 2021 [8 favorites]

We as a society, who are in aggregate very wealthy, should not be subsidizing the profits of a narrow rentier class who add little of value to the economy compared to what they extract

I feel the housing that my landlord provides very much does add value to my life, but maybe I am in the minority?
posted by Anonymous at 1:48 PM on March 8, 2021

Is your landlord being charitable, and not making a profit off of you? Do you feel like, say, wages are fine wherever you work, just because you have a job?

*My* landlord could be replaced by a public service and would almost certainly become more responsive to issues; but generally, it's not a question of whether you like your landlord, but whether you think that the system is unfairly extractive from people with the least to spare.
posted by sagc at 1:51 PM on March 8, 2021 [7 favorites]

If your landlord lives in the building, provides maintenance and repair services, contracts with utility providers, adjudicates tenant disputes, and otherwise supplies necessary services, then your landlord should be fairly compensated for their time and labor, just as any worker should.

If your landlord does none of these things and merely collects rent from you on the grounds that they "own" the building, your landlord is a parasite and should go get a real job.
posted by Faint of Butt at 1:52 PM on March 8, 2021 [6 favorites]

The government doesn't set McDonald's prices.

This is me gesturing at the acres and acres of food, transportation and workplace safety regulations, minimum wage laws, employee rights, agricultural subsides, urban planning... the list just goes on and on.

I'm glad your landlord is adorable but that doesn't bolster your position.
posted by mhoye at 1:53 PM on March 8, 2021 [14 favorites]

Aaaaand now we're gotten to the Marxism vs. capitalism stage of the conversation, and no minds will be changed.
posted by PhineasGage at 1:57 PM on March 8, 2021 [3 favorites]

If the price of McDonald's fries had shot up to $20 in the last couple decades because of a chronic food shortage and for some reason, more potatoes weren't being grown, people would be complaining to the government, too.

And rightfully so. Markets are tools to incentivize the creation of scarce goods. If they are not doing that, then that is called market failure.

Sky high housing prices are not incentivizing the creation of enough housing that people can afford. That is a market failure. Some other tool than "free markets" needs to be applied to the problem.
posted by Zalzidrax at 1:57 PM on March 8, 2021 [11 favorites]

First: if you want free housing for everybody and believe building/land ownership should not exist then just say that. Don't beat around the bush.

If your landlord lives in the building, provides maintenance and repair services, contracts with utility providers, adjudicates tenant disputes, and otherwise supplies necessary services, then your landlord should be fairly compensated for their time and labor, just as any worker should.

Isn't this the whole point of landlords (aside from living in the building--I don't think you need to live in the building to be a good landlord)? Isn't this why tenant law exists, to ensure this contract is met?

If your landlord does none of these things and merely collects rent from you on the grounds that they "own" the building, your landlord is a parasite and should go get a real job.

If your landlord is not providing maintenance etc then your landlord is probably in violation of the law and needs to be held to it. If your landlord is not providing maintenance and is not in violation of the law, then to me it follows the lack of regulation is the problem, not the concept of the landlord.
posted by Anonymous at 2:01 PM on March 8, 2021

That's such a reductive framing, schroedinger. For one thing, saying "just get better laws" is a cop-out. You need to pay a bunch of money to enforce them, among other things, and landlords are very good at avoiding anything that might cost them money. See also Grenfell, most student housing...

And I don't have a strong opinion on property/land ownership! I definitely have an opinion on rent-seeking behaviour that can be regulated at, say, a city-wide level.
posted by sagc at 2:03 PM on March 8, 2021 [2 favorites]

I'll openly state that I believe in free housing for everyone and that ownership and rent should not exist.

Landlords are parasites.
posted by sotonohito at 2:08 PM on March 8, 2021 [10 favorites]

Aaaaand now we're gotten to the Marxism vs. capitalism stage of the conversation

Rather, we've reached the point where one person chooses to deploy a thought-terminating cliche to avoid further thought.

The government is intimately involved in the rental market, as it is with most markets of any size, importance, or complexity. The fact that your landlord can say he "owns" a building at all is very literally the responsibility of the government (property rights are a creation of law). The fact that your landlord can demand rent from you is also a function of governmental intervention: the courts can evict you legally, the sheriff comes to remove you physically, back rent becomes a legally enforceable judgment against other assets. So, yes. I am comfortable with the general concept of regulating profits as well.

Isn't this the whole point of landlords (aside from living in the building--I don't think you need to live in the building to be a good landlord)?

Sometimes I think the single most exhausting aspect of Mefi (for cis non-disabled white people, at least) is having to explain to well-off suburban/techie people over and over and over again that the system doesn't actually work in the idealized form that they think it "must" (up to the minute they decide to exploit the system for their own profit). The point of being a landlord, from the private landlord's point of view, is to extract maximum profit from a piece of property. Nothing else.
posted by praemunire at 2:10 PM on March 8, 2021 [30 favorites]

it follows the lack of regulation is the problem, not the concept of the landlord.

I wonder where this lack of regulation comes from? Are we not watering the land enough? Should we be adding more fertilizer?
posted by praemunire at 2:11 PM on March 8, 2021 [6 favorites]

I'm just glad to realize that this post isn't about the rent of birth control.
posted by gurple at 2:15 PM on March 8, 2021

Sometimes I think the single most exhausting aspect of Mefi (for cis non-disabled white people, at least) is having to explain to well-off suburban/techie people over and over and over again that the system doesn't actually work in the idealized form that they think it "must" (up to the minute they decide to exploit the system for their own profit).

Uhhhh, this is the case for pretty much every law. Should we throw out laws? Or maybe should we be looking at how to fix the broken bits?

praemunire, what are your opinions about the ownership of buildings and land? Should people be able to privately own them? If so, are you saying they should not be allowed to rent them out?
posted by Anonymous at 2:19 PM on March 8, 2021

counter-counter-counterpoint:

Although I definitely have some friends who have benevolent landlords, I know far more friends with purely rent-seeking landlords. Landlords ranging from individual predators barely able to function in polite society, to faceless corporations to gamblers who are not investing property but in property-flavored units of investment. And all of them are jacking up rents as high as the market can bear.

There is no purely market-based solution that will protect renters.

I'm a homeowner now because I could already see in the early 2000s that I wouldn't be able to afford renting in city much longer, just from the rampant speculation in my first few years of having a real post-college job.
posted by ivan ivanych samovar at 2:19 PM on March 8, 2021 [7 favorites]

Goddamn, schroedinger. This a thread about rent control and rent stabilization, not some bogeyman of the government coming in and dispossessing landlords at gunpoint. They just might... make slightly less money.
posted by sagc at 2:20 PM on March 8, 2021 [8 favorites]

Rent control is diagonal to the goal of giving everyone access to affordable housing.

This. If you try to enforce price on supply constrained goods the supply will only dry up. The biggest problem with housing in cities is that mandating rents is easy. Building up social housing stock is hard and expensive. Only the latter actually works long term.
posted by Your Childhood Pet Rock at 2:22 PM on March 8, 2021 [1 favorite]

Half that problem comes back to profit motives, though - Building up social housing stock is also hard when companies know that they can make massive profits on that land from a high-rise with luxury apartments, and people don't have an alternative to paying their rents anyway.
posted by sagc at 2:26 PM on March 8, 2021 [2 favorites]

It's worth remembering the background of the author of the original post, which is history; she's approaching it as a specific moment in Irish history that maybe we can generalise from, rather than the other way around. In late 19thC Ireland the tenant farmers had another avenue of recourse they went to surprisingly often, which was to burn the landlord's house down or murder the rent collector—we can agree, that's a pretty rare thing in high-rent cities nowadays. There's no such thing as an ahistorical 'landlord' in the abstract because every society in every time arranges itself differently. In the Irish case, she's arguing, 'paper' was created to officialise a rent-relationship, because for the Government that was better than the alternatives on hand (more landlords getting burned out, or the population leaving for America). Once again, landlord-murder and emigration to 19thC New York aren't options any more, so to understand rents we need to look at societies as they are, not as economistic abstracts.

I for example live in a blisteringly high-cost city, Sydney, in a country where buying housing for rent is one of the only realistic means to provide for one's retirement—there simply aren't any other kinds of investment that make a return to compete with it. Because there hasn't been a serious housing bust since the 1960s, and because Governments have encouraged property as a social policy, 'landlords' aren't a narrow rentier class, but a wide swathe of the population, bought into it, who vote for restrictive housing policy accordingly to protect their assets: it's at the same time true that landlords are parasites, but they're also probably your aunt or uncle or your workmate, and you're being priced out of housing by the same people who complain about over-development while asking you why you haven't bought a house yet, Fiasco, I'm worried you're going to miss out? Other high-cost cities have different problems (San Francisco and its tech wages, for example, is unique).
posted by Fiasco da Gama at 2:29 PM on March 8, 2021 [13 favorites]

Uhhhh, this is the case for pretty much every law. Should we throw out laws? Or maybe should we be looking at how to fix the broken bits?

We're never going to do that until it becomes horrifically embarrassing for grown, educated people to profess to be unaware of widespread abuses in their society--and therefore deny the need for change--just because they're comfortable enough usually to avoid them.

praemunire, what are your opinions about the ownership of buildings and land? Should people be able to privately own them? If so, are you saying they should not be allowed to rent them out?

I get the feeling you think this is some kind of scary unanswerable gotcha question? (a) I learned to deal with this kind of rhetorical trick in high school, if not earlier. I mean, really. Come on. (b) I live in a city with one of the strongest rent-control regimes in the U.S., though it's still not particularly strong. The idea that strong rent control and the abolition of private property are one and the same is so weakly evidenced either historically or theoretically that it's not even worth acknowledging.
posted by praemunire at 2:38 PM on March 8, 2021 [10 favorites]

There is no reason I, who has a comfortable income, should have my living costs effectively subsidized by my landlord, who is an individual that bought a small apartment building that generates modest income...

...Aaaaand now we're gotten to the Marxism vs. capitalism stage of the conversation, and no minds will be changed.

Capitalists would agree that the housing market prices the costs of rent control into property purchase prices, which means that in no way does your landlord "subsidize" renters' costs. The assertion that they do is blatant pro-capital spin, making the "and now the ideologues are here to ruin everything" followup take especially rich.
posted by Lyme Drop at 2:41 PM on March 8, 2021 [7 favorites]

praemunire, what are your opinions about the ownership of buildings and land? Should people be able to privately own them? If so, are you saying they should not be allowed to rent them out?

Personally I believe that there should be a property tax that increases exponentially with the amount of properties you own, so owning one building is very cheap and hoarding many, many properties is extortionately expensive and actively discouraged
And then the government should build and buy up housing to provide social housing at a variable rent dependant on income so everyone has somewhere to live.

Because the nice landlord who owns and does maintenance on his own one building is not the problem, the problem is the folks who use their existing lots of money to just buy property and pay other people to maintain it, thereby making lots more money whilst doing nothing themselves. They are just parasites. Especially now they've discovered Airb&b but that's another story.
posted by stillnocturnal at 2:48 PM on March 8, 2021 [6 favorites]

the nice landlord who owns and does maintenance on his own one building is not the problem, the problem is the folks who use their existing lots of money to just buy property and pay other people to maintain it

And this is where society-specifics to rent are important, because in Sydney it's definitely the other way around—there's a premium to living in Mirvac blocks of flats, for instance, because they're known to be highly capitalised, and run maintenance by a system they report on to their shareholders. The worst houses, and I've lived in them, are the ones where the retired landlord has no income except for the rent you pay them, and sends around their son-in-law Brett with his box of stillson wrenches and duct tape for every problem. Don't start me on Brett.
posted by Fiasco da Gama at 2:58 PM on March 8, 2021 [8 favorites]

I get the feeling you think this is some kind of scary unanswerable gotcha question?

No, it was an honest question. If that's what you're in favor of that's fine. Right now you seem to be under the impression that anybody renting to anyone is some kind of horrible leech and the provision of housing could not be itself a service. So I am trying to figure out whether you think any sort of ownership and renting is acceptable, and if so under what boundaries.
posted by Anonymous at 3:09 PM on March 8, 2021

What? People are just saying it shouldn't be a service left entirely up to what the landlord can charge. And you can see why people might complain about landlords as the direct interface between an exploitative system and themselves. I think it sometimes can get into denigrating landlords pointlessly, but I would also know that you're the one calling landlords leeches.

Also, can you explain a bit more about what you mean by "a service"? The only way it really makes sense to me is that you're surprised other people aren't grateful to their landlords.
posted by sagc at 3:12 PM on March 8, 2021

you're the one calling landlords leeches

I'm sorry, did you miss:
a narrow rentier class who add little of value to the economy compared to what they extract
your landlord is a parasite and should go get a real job.
Landlords are parasites.
They are just parasites.
it's at the same time true that landlords are parasites

You're technically correct though, nobody except me has specifically used the word "leeches".

Also, can you explain a bit more about what you mean by "a service"? The only way it really makes sense to me is that you're surprised other people aren't grateful to their landlords.

The way selling groceries is a service, or fixing a car is a service, or building a chair is a service. Buildings, land, and the maintenance of them are not free, the housing I get from these non-free things is valuable to me, so I think it is fair for me to pay for it. I don't think it is fair to expect landlords to provide housing and all of that entails for prices that do not adequately compensate them for their effort and labor. I am all for a society where housing is free and provided by the government and subsidized by taxes (though I am skeptical that the government will be that much better a landlord), but I am not in favor of shitty half-measures like rent controls that do nothing but further distort the market and drive out small landlords and skyrocket the price of housing that isn't rent-controlled.

We're never going to do that until it becomes horrifically embarrassing for grown, educated people to profess to be unaware of widespread abuses in their society--and therefore deny the need for change--just because they're comfortable enough usually to avoid them.

I agree. Do you feel there are people here who are professing to be unaware of widespread abuses in our society?
posted by Anonymous at 3:49 PM on March 8, 2021

I thought this bit about rent control as anti-colonialist reparations was quite an interesting detail in the article:

In the nineteenth century, rent control was an anti-colonial measure. Rent control, as a theory, was possible only because the Victorian Liberal Party, under the direction of William Gladstone as prime minister, embraced the logic of historical reparations for the English colonization of Ireland, the illegal seizure of property, and the prohibition against Catholic persons owning property. In effect, rent control promised to reverse the racism of an economy established under empire.

I can certainly see some parallels there with modern day North American issues.
posted by eviemath at 3:51 PM on March 8, 2021 [4 favorites]

schroedinger, I think that you're creating a massive strawman here. People who care for the buildings can get paid for their labour; I personally don't have any problem with that. There's a name for it, and I'd say it's "superintendent", not "landlord".

Look, if you think it's insulting to call a rentier class a rentier class, I can't imagine how you'd ever arrive at anything other than hard-core capitalism, which I guess makes sense.

Also, building a chair is not, in fact, the same as owning some land. I would say that is perhaps the entire core of this broader discussion.
posted by sagc at 3:55 PM on March 8, 2021 [9 favorites]

This part:

In the decade after the famine, Irish activists began to debate the economy in detail. They proposed ideas about an economy that would give opportunity to all. At the core of those ideas were notions that defined rent and eviction as issues at the crux of how poor people fared in an economy.

also puts me in mind of the work of Matthew Desmond and others on the harmful impacts of eviction, and the structural racism that means that eg. Black women in the US significantly disproportionately bear those harmful impacts.
posted by eviemath at 3:56 PM on March 8, 2021 [3 favorites]

This part seems highly relevant to the present day, as well (replace innovations in farming with the economic "efficiency" du jour):

According to Irish theorists, high rents had the ironic consequence of raising investor expectations of profit in such a way as to ratchet prices in one direction only: up. Evidence of high rents among starving peasants led absentee landlords, who rarely saw the conditions of Irish misery for themselves, to assume that high rents were afforded by technological progress and innovations in farming, and that potentially the rents could be raised forever. Together, the force of rising expectations on returns and tenant misery created a destructive cycle for the economy as a whole. Rather than a business cycle, Ireland had a speculation and eviction cycle.

The existence of a speculation and eviction cycle is quite apparent eg. in cities across Canada currently (with that already being an issue pre-pandemic, but drastically accelerated due to the pandemic), and even fairly mainstream economists worry about the broader scale negative economic impacts of that.

The bit about absentee landlords not seeing the conditions of tenants also reminds me strongly of housing conditions where I went to grad school, where people were crammed three or four to a bedroom... and that was 15-20 years ago, and economic inequality and insecurity has only gotten worse since.
posted by eviemath at 4:07 PM on March 8, 2021 [2 favorites]

Look, if you think it's insulting to call a rentier class a rentier class, I can't imagine how you'd ever arrive at anything other than hard-core capitalism, which I guess makes sense.

You seem really intent on misreading my comments. It is quite clear that "who add little of value to the economy compared to what they extract" was the part that fit into the other accusations of landlords being parasites. By the way, do you feel that "parasite" is somehow different from "leech"? Or are you skipping over the point I made because it would require you to admit you are wrong?
posted by Anonymous at 4:07 PM on March 8, 2021

No, I believe that parasite is... not over the top when describing rentiers in a capitalistic system.
posted by sagc at 4:09 PM on March 8, 2021 [4 favorites]

Also, I think you've said that a) you're worried about landlords being entirely removed from the equation, b) that this will be because of rent control, and c) that you're in favor of an entirely government-run housing system. Wouldn't that dispossess landlords far more than rent control ever could?
posted by sagc at 4:11 PM on March 8, 2021 [2 favorites]

Another interesting detail from the article is the view of rent control as part of an entire system of land/real estate valuation, which would set prices for buying and selling real estate, as well as setting rents. Tenant unions having a role in negotiating rents in such a system.
posted by eviemath at 4:14 PM on March 8, 2021

Mod note: Hi folks, comments removed, please pay attention to the Content Policy.
posted by jessamyn (staff) at 4:15 PM on March 8, 2021

This definitely sounds appealing for North American economies nowadays (noting that the preceding paragraph describes the instability of eviction as also being a form of violence):

The alternative economy of rent control—the one proposed by Irish theorists and enacted by the courts—opened up an alternative to unending practices of violence. It also released Ireland from the constant ratcheting upwards of rent, marking out Ireland a space where rights of occupancy were favored over long-distance investment. In the decades that followed, Ireland became a mass social experiment with local, sustainable economics and the value of occupancy against displacement. Wealthy capital in many cases indeed left Ireland, with former landowners selling their real estate and fleeing to California or elsewhere. But meanwhile, the system of land valuation made possible something extraordinary: the ratcheting downward of rent, making it possible for ordinary tenants to live free from eviction, and the mass redistribution of property.
posted by eviemath at 4:22 PM on March 8, 2021 [3 favorites]

can you explain a bit more about what you mean by "a service"

I'll have a go at this one too—when you really get down to it it's suprisingly difficult to define what the relationship of landlord to tenant really is, and it's completely dependent on moral arrangements and assumptions in societies. There's some forms of renting, like holiday houses in beach towns, or serviced apartments near big hospitals, that are obviously part of a service economy; the landlord provides everything from a roof to towels and sheets, sends a cleaner, and leaves you fresh milk in the fridge. There's others, like being an Irish subsistence farmer in 1881, when there's no service going on, and it's far more obviously a relationship of extraction and power. Most people's experience of renting or owning is in between; my own landlord provides something of a service in letting me live in a pretty nice house I would have no chance of affording to buy on my own, and enjoys something of a right to extract a proportion of my wages every fortnight.

How closely chair-building relates to land-owning (or, in other words, what exactly it means to own a thing), that's a central problem of economics and of history and sociology. And it gets even more difficult because it's impossible to separate the nature of these 'possessions', sometimes in the form of rights, sometimes in services, from every society's unique arrangements involving State power, the body that gets to say what property rights are—sectarianism in Ireland, racial segregation in the USA, squatting and property corruption in Australia, and so on infinitely...
posted by Fiasco da Gama at 4:25 PM on March 8, 2021 [9 favorites]

Interestingly, I can see the connection between the Irish land valuers described in the article and appraisers (such as my condo complex has to hire periodically) nowadays. So we still have that in some sense for land ownership. But even North American jurisdictions that have some form or other of rent control definitely don't take any sort of expert evaluation or assessment of building conditions into consideration in rent review/rent control decisions.
posted by eviemath at 4:27 PM on March 8, 2021 [1 favorite]

One might quibble with the article's conclusions about the revolutionary power of bureaucrats/technocrats embarking on reformist agendas, of course.
posted by eviemath at 4:34 PM on March 8, 2021

People who perform building maintenance are performing a service. Rental management companies perform a service. People who do those things deserve to get paid for those things, no question. What, precisely, is the service that a landlord who does none of the above providing? They deserve to make a profit just for the fact they own a building? The fact they already have the money to own property means they somehow *ought* to make a profit off that?

My parents would like to buy a small shop. They literally cannot because there are almost none available in my city, only leases are available. Because if you own a retail property, you can rent it out to somebody who then has to pay all the upkeep maintenance and property rates and rent and at the end of the lease you can raise the rent because yay the area is more popular now. Why would anyone ever sell. The only small shops that survive long term are those that manage to buy, because otherwise success will just equal more rent and eventually you get priced out. The whole system is rigged. The owners of those retail spaces provide literally zero "service".

Also housing is an "essential" and cannot be compared to a chair in any meaningful way. Sitting on the floor is a minor inconvenience, unlike, you know, homelessness.
posted by stillnocturnal at 4:35 PM on March 8, 2021 [13 favorites]

Irish land reform was the result of a high degree of unrest, including out right revolutions on varying scales. And the chance to buy land back that their ancestors owned was not exactly negotiated in the way this was represented. It was also a bottom up movement that was very fast to move to burning things down and assault and murder if thought necessary.

I mean that is one model of negotiating rent, but it doesn't seem to be what they are aiming at.

(There is a book that gathers a number of threatening letters sent to landlords in Ireland and they could not exactly be termed negotiating letters.)
posted by lesbiassparrow at 4:40 PM on March 8, 2021 [3 favorites]

Buildings, land, and the maintenance of them are not free

Sure, but it's disingenuous to suggest that the costs of buildings, land, and maintenance are always equivalent to or even in the same ballpark as the profit extracted by many landlords.

Pre-pandemic, my landlord's profit margin was something like 80%. Vacancies have dropped that to maybe 60%.

In terms of labor, he cashes our checks and pays a few bills online. He'll grudgingly call a repair person once a year or so when our boiler goes down, but isn't about to deal with having it regularly inspected or serviced. I guess he also sends someone to sweep the halls once a year. Call me crazy, but I think that the amount of labor he's putting in doesn't exactly make up the difference.

In terms of market distortion, our building is fully market rate but as of yet the free hand hasn't swooped in to level anything out. As far as I can tell it's been too busy putting up a bunch of luxury high rises with giant mechanical voids in Midtown.
posted by evidenceofabsence at 4:53 PM on March 8, 2021 [5 favorites]

Worrying about rent seeking is hardly some "hard" left position. Plenty of economists worry about rent seeking behavior. I'm not sure why some are acting like Mao just walked in.

Me personally, my landlord is a gigantic faceless corporation that owns rental properties up and down the east coast of the United States. The people who manage and repair the property are employees of that corporation. Such has been the case for the vast majority of my rental experiences.

I imagine in the future such arraignments will become ever more common. After the 2008 crash banks and other large companies bought up countless distressed properties. Many ended up turning into rentals. The people being bought out were exactly the type of small-time landlords who wanted additional income for their retirement or whatever. Some of those individuals did survive; I often hear radio ads for property management companies that off to manage such properties for a fee.

In any case, the present housing situation in the US reminds me of the horror stories people used to tell to illustrate the horrors of central planning. Instead of empty cities built in the middle of nowhere with buildings that fall down, we have empty skyscrapers full of mostly uninhabited "luxury" apartments of dubious quality used for investment purposes rather than shelter. Meanwhile, the housing market as it exists can't seem to provide enough supply to bring prices closer to affordable levels in areas where people want to live as "basic economics" says it should. Instead, the high housing costs seem to be spreading inland from the coasts ....
posted by eagles123 at 6:03 PM on March 8, 2021 [6 favorites]

As inequality intensifies, markets approach central planning
posted by eustatic at 6:13 PM on March 8, 2021 [3 favorites]

An interesting article, describing not just rent control but also the practice of land valuation. I'm reminded of Douglas Macdonald's book Adventures in Chaos, in which he describes how the US tried and failed to stabilize client governments in Asia (like Chiang Kai-Shek's KMT) by getting them to pursue land reform - basically breaking up large landholdings and spreading the ownership more widely. (It's remarkable how easily a client government can resist reform. When things are unstable: "We need to get the situation under control first." When things are stable: "Why rock the boat?")

Thanks to PhineasGage and schroedinger for making the standard economics case against rent control. I'm in Vancouver, where we have a severe shortage of rental housing. Prices reflect scarcity, and market prices have risen dramatically, but actual rents paid are limited by rent control - currently annual increases are inflation plus zero (down from inflation plus 2% a couple years ago). This tends to aggravate scarcity: it increases demand (people who are paying below-market rents are going to stay there instead of moving) and decreases supply (it becomes harder to justify building more rental). The result is that it's really hard to find a place to rent - it's like musical chairs.

Zak Vescera on Twitter:

Apartment hunting in Vancouver: 20 people at the showing. There are no windows. Lease is 600 years. Price is your soul.

Apartment hunting in Saskatoon: Utilities you never knew existed are included in rent. Landlords call you drunk at night begging you to move in.

And then this has a number of downstream effects - lots of people who want to live in Vancouver can't afford it, private- and public-sector employers can't find workers, school enrolment is declining because young families can't afford to live here, people end up living further away and commuting (worsening traffic congestion), high rents aggravate homelessness.

Of course rent control is just a band-aid. The real problem is scarcity, which can only be resolved by more housing. (Or by a declining number of people who want to live in Vancouver, e.g. if Vancouver became a crappier place to live.) Apartment List provides some Covid-era evidence that rents are falling where vacancies are rising, and rents rise where vacancies are falling.

At the municipal level, the City of Vancouver has been pushing hard for more rental housing, often including 20% affordable housing units (with rents set at 30% of neighbourhood incomes), but it's been slow. The problem is that building rental apartments (instead of condos) requires spreading the cost of the land over more units, by building six stories instead of four stories, and this requires a rezoning decision with a public hearing. Naturally there's always local opposition. If you ask people living in the neighbourhood if they want it to change, the answer is always going to be no - they like it the way it is, that's why they live there!

I expect the longer-term solution will be broader rezoning. (Plus there's more indirect solutions: expanding the radius of land within a reasonable commute of downtown by building more rapid transit and reducing traffic congestion, deepening the labor market in mid-size cities so that we don't have everyone crowding into Vancouver. Canada isn't running out of land.)

Turning back to rent control, it seems like an example of the Just Price Fallacy - the idea that if prices rise it's unfair to the poor, so we should keep prices low. The problem is that rich people tend to consume a lot more than poor people, so they get a lot more of the benefit. (At least in Vancouver, where home ownership is unaffordable, rich people rent as well as poor people.) You get the same arguments from Canadian conservatives against carbon pricing. As PhineasGage says, it's better to help poor people by giving them money, not by fiddling with prices.

Joseph Heath describes the example of subsidized electricity prices in Canada:

The middle-income quintile spends an average of $1,117 per year (2.4% of income), while the upper quintile spends $1,522 per year (1.1% of income). This means that the $250 million annual gift being bestowed upon the poor is coupled with a $408 million gift to the middle class and a $556 million gift to the richest 20% of the population. Needless to say, a welfare program that required giving $2 to a rich person for every $1 directed to a poor person would hardly be regarded as progressive (despite the fact that, when expressed as a percentage of income, the poor person is receiving “more”).

More generally, some problems are better solved indirectly rather than directly.

Q. So the impression I’m getting is that the biggest mistake the Left makes is imposing its moral considerations directly on the market, which is more or less self-sufficient with regulatory oversight from government.

A. Yeah, often what happens is that people apply their moral intuitions at kind of the wrong level. There’s nothing wrong with having a reaction to first-order results that the market generates, but often people try to correct the problems by directly intervening at the first-order level. And because the market is a staged competition, you often can’t tinker around at the first-order level. What you need to do is tinker around at a higher-order level, with rule changes and so forth. So say you’re unhappy with the way NHL hockey is working out, the same teams are always winning the Stanley Cup or something like that. And so you think that there’s inequality in the way that the NHL is being structured. A first-order response would be to try a direct handicap, so that [successful] players had to play with one arm tied behind their back or whatever—you directly tinker around to change the outcomes. The problem is that that can have all sorts of perverse effects. So you have to address the first-order problems at the second-order level of rule changes. That takes a little more forbearance, because, first of all, it’s not directly addressing the problem, and second of all, you have to wait a couple of years to see if it has the intended effect. You have to be willing to sort of displace your immediate moral reaction, and endorse more abstract policy remedies. And willing to wait a bit and see what happens.

From a society-wide point of view, we need capital, not just labor. Think of constructing a new rental apartment building: you need a lot of capital to pay for land, materials, and workers before you ever start collecting rent. That's why "return on investment" is important - investors are lending their money and getting some kind of return on it. (Parenthetically, this is why the Nordic countries use a high tax on consumption, around 25%, and relatively low taxes on capital income - it turns out that a consumption tax doesn't affect return on investment. Stephen Gordon explains.)

Even if you had Full Socialism I'm not sure how this would change. If you want to allocate more resources (land, materials, labor) to investment, that means deferring consumption.
posted by russilwvong at 6:38 PM on March 8, 2021 [4 favorites]

I should add that rent control does have benefits as well as costs - it helps to provide predictability for renters. But I think freezing real rents (as British Columbia has done) is a major mistake. What you probably want is that when there's a gap between actual rents and market rents, actual rents should catch up, but gradually rather than suddenly.
posted by russilwvong at 6:44 PM on March 8, 2021

Sure, but it's disingenuous to suggest that the costs of buildings, land, and maintenance are always equivalent to or even in the same ballpark as the profit extracted by many landlords.

Hahaha I just came to this thread from AskMe, where I posted a question about how to deal with my rental kitchen, which has an oven plugged into a single ungrounded outlet that is INSIDE a cabinet, accessible by hole punched through the cabinet, with an extension cord. My lights dim every time anyone turns on a television. I was given 6 keys when I moved in and only 2 of them open doors in this building.

My landlord earns over 60K per month on rent from this building and I'm expected to believe she fuckin' earned it?
posted by We put our faith in Blast Hardcheese at 6:45 PM on March 8, 2021 [14 favorites]

No, I believe that parasite is... not over the top when describing rentiers in a capitalistic system.

Except that wasn't the point. You were claiming nobody was insulting landlords in this thread. I pointed out they were. Now your response after first claiming nobody was insulting landlords is to . . . insult landlords. OK.

Also, I think you've said that a) you're worried about landlords being entirely removed from the equation, b) that this will be because of rent control, and c) that you're in favor of an entirely government-run housing system. Wouldn't that dispossess landlords far more than rent control ever could?

I mean, sure, if you just seize people's property without asking and without providing adequate compensation. Which would not be the ideal way to do it, in my opinion.
posted by Anonymous at 6:53 PM on March 8, 2021

Joining on the rent control discussion: North America and Europe have another mechanism of controlling rent prices that South Korea and Japan are experiencing. The first world's birth rates are below replacement rates; the average age is expected to rise every year and then negative growth rates would appear. A decreasing population would decrease housing demand and create excess supply of housing. Closing the borders to new immigration would cause the average age to increase. I know there's huge implications to retirement funds and the economic growth rate, but why exactly should a young person care about someone else's pension when they're trying to afford a home?
posted by DetriusXii at 7:31 PM on March 8, 2021

russilwvong, you sure wrote an awful lot of words on a topic directly addressed by the FPP article, without in any way mentioning the article or explaining why the FPP didn't actually pre-refute (prefute?) your arguments. You should also maybe look into the actual details of the various types of rent control and vacancy control systems that are both currently in place in Canada, the US, or around the world, or have historically been in place (eg. as described in the FPP link). As it is, you're arguing a bit of a strawman.
posted by eviemath at 7:39 PM on March 8, 2021 [3 favorites]

Rentier

Maybe this isn't the place to ask this question, but here it is: what is an economic rent?

From what I can tell, there are basically two approaches to a definition. The first, a Georgeist take, is this describes any revenue from land/property. The second seems to be a more reified concept that takes the place in situations where a market inefficiency exists but is not caused by lack of competition. These both seem lacking. The first one is fine except that "property" seems like something that is slowly being abstracted into a near equivalent of capital. The second one is just a kind of dirty word for various flavors of market "inefficiencies".

Ie, it seems like a semantic device for people who don't like landlords more than anything with a strict economic logic.

housing for rent actually crowds out more productive investment.

Here does 'crowding out' mean anything more than 'more profitable'?
posted by Reasonably Everything Happens at 8:36 PM on March 8, 2021

The real problem is scarcity, which can only be resolved by more housing. (Or by a declining number of people who want to live in Vancouver

It's interesting that Australia is currently conducting a natural experiment in this. Our borders are extremely shut, the immigration rate has effectively been zero since March 2020, there are few if any international students, and no overseas tourists at all. There ought to be artificial scarcity. Everyone expected a housing bust, or at least a rental bust, but it hasn't turned out that way; there's been a boom in the regions (of workers-from-home moving out of the city), city rents have stayed stable thanks to eviction moratoriums and job subsidy, and there's a huge urban housing price boom going on. What seems to be happening is that people with steady jobs are taking advantage of low interest rates to pour more savings into housing—as I said upthread, because it's so much better as a return than any other investment class in this country, and historically supported by government policy. It's not possible to think economistically about rents and housing prices without looking at what's going on in the rest of a society.
posted by Fiasco da Gama at 8:47 PM on March 8, 2021 [2 favorites]

Here does 'crowding out' mean anything more than 'more profitable'?

It's not even about profit. Rents in most cities are shit. Yields are like <4%. The point is that money could be better invested in other parts of the economy and subsequently spent if hundreds of grand wasn't locked up in each extra house as an investment. Economic activity and prosperity comes from the velocity of money along with the amount. Money sitting at a standstill doesn't do shit for anybody, little alone its owners.
posted by Your Childhood Pet Rock at 9:07 PM on March 8, 2021

I was surprised to find that currently in New York City only about 1.0% of apartments are actually rent controlled. A larger portion ~ 43% are "rent stabilized", which basically seems to mean that there is a board that determines maximum allowed rent increases. It sounds similar to the community rating boards used by the ACA health insurance exchanges operating in my state. In any case, the lack of rent control certainly doesn't seem to have led to increased supply necessary to bring down costs in NYC.

Rent Control in NYC wikipedia

More info on rent control and rent stabilization
posted by eagles123 at 9:08 PM on March 8, 2021 [1 favorite]

[In Australia:] Everyone expected a housing bust, or at least a rental bust, but it hasn't turned out that way;

Interesting. In Canada, house prices have been rising (interest rates are low, people who have secure jobs want more space), but market rents in Toronto and Vancouver have been falling (down about 6% in Vancouver), as landlords lower their rents to try to fill vacancies. How landlords are trying to lure new tenants in a pandemic. Rental supply is up because the short-term rental market is dead, so Airbnb owners are putting their units on the long-term market; rental demand is down because there's no international students.

It's not even about profit. Rents in most cities are shit. Yields are like < 4%.

In Toronto, there were a significant number of condo investors drawn into the market by the expectation of continued rapid price increases, who are losing money each month (cash flow negative). A story from 2018: Investors in new Toronto condos face growing risk that rent won’t cover expenses.

Looking at what happened to the US housing market in 2006 and 2007, I suspect that soaring house prices in Vancouver and Toronto are what Robert Shiller calls a natural Ponzi scheme.
posted by russilwvong at 9:29 PM on March 8, 2021

The real problem is artificial scarcity
My city had 65,000 people living in homeless shelters in 2018, the vast majority of them as families. Meanwhile, we had 250,000 unoccupied units, 27,000 of which appear to have been warehoused. I'd wager that a lot of that warehousing was the result of landlords holding apartments back because they had irrational ideas about where the market was headed and what they could get. Should we build more affordable units? Yes, sure, and let's concentrate on that instead of luxury housing. But getting people into housing that already exists and keeping people in their homes seems like a proximate and humane solution.

So you have to address the first-order problems at the second-order level of rule changes.
It's a little weird that you're making this point when rent control is a rules change and direct payments are a first-order solution. The market rate for a 1-bedroom is about $2,500 here. If landlords are asking for proof of 40x annual income, that's $100k. Median household income is $63k. How are you going to fill that gap in a city of over 8 million people? Where is that funding coming from? And how is that solution not a pass-through that enriches the people who are least in need of enrichment?

Finally, speaking of Ireland, anyone know how the housing crisis in Dublin is going? Last I heard, COVID resulted in a number of Airbnb units returning to the rental market. Is that still the case? Have people poured back into the city? Any hope for radical bureaucracy or modern-day boycotts?
posted by evidenceofabsence at 9:59 PM on March 8, 2021 [3 favorites]

what are your opinions about the ownership of buildings and land? Should people be able to privately own them? If so, are you saying they should not be allowed to rent them out?

I am surprised this entire conversation has taken place without referencing redlining and the many, many ways in which people were able to take advantage of a racially biased system of mortgages to obtain those properties in the first place.

When you have one class of people who are able to purchase properties through the sole aspect of being white enough to have a mortgage, renting to another class of people who are paying far more in rent than they would for a mortgage to actually purchase the place they are living in, then you have an enormous equity problem regardless of what economic system you believe in.
posted by corb at 10:10 PM on March 8, 2021 [11 favorites]

Interesting. In Canada, house prices have been rising (interest rates are low, people who have secure jobs want more space), but market rents in Toronto and Vancouver have been falling (down about 6% in Vancouver), as landlords lower their rents to try to fill vacancies.

Whereas elsewhere in Canada, eg. In Halifax and Hamilton and other slightly smaller cities, both housing prices and rental prices are way up (market rents by 15-20%). In the case of market rents, already super low vacancy rates (eg. around 1%) meant that Airbnb units that were returned to the regular rental market were asking Airbnb rates, just for longer term leases. Back in Toronto, average market rent may be decreasing, but that doesn't seem to be across the board in all segments of the rental market, as there is still a mass eviction crisis that is leaving lower income, working class, and predominantly new immigrant communities hardest hit.

Meanwhile, homelessness rates in Halifax have doubled during the pandemic.

And that's the point that is missing when you just talk about rents in very abstract, financialized terms. Eviction and housing instability have real, very serious, long-term costs for people's lives. On top of that, increased evictions and housing instability contribute to increasing income inequality and exacerbate racialized economic disparities (see eg. the article on Desmond's book Eviction that I linked upthread - which also notes that low income housing in the US has significantly higher profit margins than many people tend to assume).
posted by eviemath at 4:26 AM on March 9, 2021 [4 favorites]

Awful lot of people in here who haven't read their Maoist theory.

Look, we can solve this (philosophically and practically) basically overnight with a really simple rule: there are some aspects of the world that it's not legal to profit from. Education, healthcare, housing--we can hammer out the exact list in another excruciating discussion later, but let's agree that there are a few things that are so important to human wellbeing that it's a huge fucking problem to inject a profit motive into the space. If you want to rent out your attic as an apartment, great, go for it, but you'd better be able to show us the receipts. Profit obtained from providing someone a place to live should be treated (legally and socially) like profit obtained from selling heroin to middle-schoolers.
posted by Mayor West at 7:29 AM on March 9, 2021 [5 favorites]

I'd argue that there are three core problems to rent control, two non-ideological and the other ideological.

Non-ideologically rent control is forever a game of catch up and struggle against a monied class with nothing to do but lobby to charge higher rent.

Meaning we who do the renting are always going to need to be struggling to keep the rent affordable, and we're the ones with the least free time and money to do that with. Any rent control will be loopholed and chipped away at until it no longer exists unless there is constant work from the people paying rent. And we're too damn tired for that.

The other big non-ideological problem is that once you have a landed aristocracy gaining wealth via the simple fact of thier landed status then it is in their economic best interests to keep housing scarce so they can charge higher rent. This isn't theoretical, we see it in action all over. People who own housing lobby intensively to make new construction difficult and expensive so as to keep their properties more highly valued.

There's also the ideological objection that once we start talking rent control we've agreed that it is right, proper, and just that one group of people should have a guaranteed income and be forever free from labor while the rest of us are required to "earn our living". A truly revolting phrase based on the idea that we don't simply deserve to live and must justify our continued existence by laboring for the benefit of the rich.

Once rent control enters the picture the issue becomes "how much of our labor based income are our new aristocratic overlords entitled to" not "should we have a landed aristocracy making money off the simple fact that they own land"?

I argue that once we as a society start agreeing that it's fine for some people to be forced to labor or starve while it's also fine for others to simply live in luxury based on ownership of resources they then rent out, we've got a major problem.
posted by sotonohito at 7:36 AM on March 9, 2021 [6 favorites]

The writer's own conclusions at the end (which I don't think are entirely supported by the rest of the article) aside, the history described in the fpp link seems to be a counterexample to the theoretical claim that agitating for rent control and agitating for the abolishment of private property or land/housing as a financialized resource are mutually exclusive. Similar to being in a union at one's job that negotiates collective agreements with the employer while also working for the abolishment of capitalism. Working excessively in order to be able to afford even a minimal, substandard bit of shelter also tends to take away from the time, energy, and mental health that people have available for working toward the revolution. Meanwhile, tenants unions have done some solid organizing and building of class consciousness. A lot depends on how you do the work. One definitely can advocate for rent control from a pro-capitalism perspective instead of from an anti-capitalist perspective. It's a harm reduction strategy, not an end goal, if one is approaching it from an anti-capitalist perspective. But there is certainly value in reducing harm.
posted by eviemath at 8:35 AM on March 9, 2021 [2 favorites]

Also relevant: How Unfair Property Taxes Keep Black Families From Gaining Wealth: Flawed assessments for America’s $500 billion in annual property taxes hit Black neighborhoods hardest.

Despite its flaws, Scott clings to her little two-story Tudor on Lawrence Street with a devotion that’s hard to fathom, until you know the house’s ownership history. She’s renting a home she used to own. Wayne County took it away from her in 2013, after she fell three years behind on her property tax payments. Her house, which she’d bought in 2005 for $63,800, was auctioned off by the county and snapped up by an investment company for less than $5,000. Scott lost every cent she’d put into it.

She shouldn’t have. For years the city of Detroit used inflated valuations of Scott’s house to calculate her property tax bills, charging her thousands of dollars more, cumulatively, than she should have paid, according to a Bloomberg Businessweek analysis of her tax records. Hers was among tens of thousands of homes in Detroit’s lower-income Black neighborhoods that the city’s assessors routinely overvalued. Meanwhile they systematically undervalued homes in affluent areas, reducing the taxes those homeowners paid.

posted by eviemath at 10:19 AM on March 9, 2021 [5 favorites]

Ties into the story a few weeks back that found professonal assessors undervalue homes owned by Black people.

The value of a home owned by a Black person varies depending on what will hurt them the most.
posted by sotonohito at 12:34 PM on March 9, 2021

elsewhere in Canada, eg. In Halifax and Hamilton and other slightly smaller cities, both housing prices and rental prices are way up (market rents by 15-20%).

Right. People who are no longer tied to their jobs in the most crowded and expensive cities are moving to less expensive cities and towns - but they're bidding up house prices and rents in those places. Small towns in interior B.C. and Alberta face intense housing crunch. It's going to take at least a couple years to build more housing to meet the unexpected demand.

Eviction and housing instability have real, very serious, long-term costs for people's lives.

Absolutely. In BC, I think it makes sense to limit annual rent increases, to provide greater predictability and stability for renters. I just don't think it makes sense to limit them to zero, as BC did recently: that means that rents will never catch up to the market-clearing price. The root problem - at least in Vancouver, which is what I'm familiar with - is that there isn't enough housing to go around, and we need to build more. If you're already in a place, you're protected; but if you ever have to move, you end up hunting for housing in a market where there's very few vacancies, you're competing against lots of other prospective tenants, and prices are suddenly far higher than what you were paying before.

This is why Vancouver city council is focused so much on building more rental housing. Housing is breaking down the usual left-right split: there's council members on both left and right (including the mayor, former NDP MP Kennedy Stewart) who want more housing more quickly, and council members on both left and right who are usually opposed.

Meanwhile, we had 250,000 unoccupied units [in NYC], 27,000 of which appear to have been warehoused. I'd wager that a lot of that warehousing was the result of landlords holding apartments back because they had irrational ideas about where the market was headed and what they could get.

In Vancouver there's a similar problem - because condo prices have been rising rapidly (especially in 2014 and 2015), people have been buying them and holding them empty (brand new in box), expecting to make money from capital gains on resale rather than from rent. In response, there's now annual vacancy taxes that you have to pay if you don't live in a property or rent it out, and that seems to be having a significant impact.

It's a little weird that you're making this point when rent control is a rules change and direct payments are a first-order solution.

I think it's pretty common to identify the problem as "the rent is too damn high," and the direct response is "keep rents from rising." Thinking about it as "there isn't enough housing, we need to build more, and we need to provide subsidies to low-income renters" is a way of reconceptualizing the problem.

Along these lines, Biden has proposed expanding Section 8 funding so that everyone who qualifies can receive it - right now 3/4 of eligible families can't receive it because Congress hasn't allocated enough money.

As Jen Kirby details for Vox, America is on the verge of a housing crisis as emergency eviction moratoriums expire even while the Covid-19 pandemic continues to rage.

Additional extension of emergency measures would help. But fundamentally, the United States can’t really build a housing system around the assumption that landlords will allow tenants to live indefinitely without paying their rent. And from a tenant perspective, while not being evicted is much better than being evicted, a moratorium simply leaves unpaid debts to pile up and creates problems in the future.

When precarious renters need in the short term is actual financial help that would let them make rent. And what the country needs is a more robust housing safety net of the kind that would be created by turning Section 8 into a universal program. Under the status quo, capacity to help people with the rent doesn’t expand along with need. Under universal vouchers it would — household economic pain would be cushioned by automatic expansion of funding, and the economy as a whole would be stabilized by spending ramping up when needed.

The other big non-ideological problem is that once you have a landed aristocracy gaining wealth via the simple fact of their landed status then it is in their economic best interests to keep housing scarce so they can charge higher rent. This isn't theoretical, we see it in action all over. People who own housing lobby intensively to make new construction difficult and expensive so as to keep their properties more highly valued.

Again I'm going to talk about Vancouver because that's what I'm familiar with: opposition to housing construction seems to be coming from homeowners rather than landlords. Canadians don't like change - whenever there's a referendum, no matter what the question is, the answer is no. Similarly, whenever there's a public hearing on a rezoning, you're basically asking people if they want their neighborhood to change. Naturally the answer is going to be no: they like the neighborhood the way it is, that's why they live there! (An example: Don Davies is an NDP MP, i.e. a progressive/left-wing Member of Parliament, who urged council to say no to a rental project in his neighborhood, while the pro-housing mayor, Kennedy Stewart, is a former NDP MP.)

I argue that once we as a society start agreeing that it's fine for some people to be forced to labor or starve while it's also fine for others to simply live in luxury based on ownership of resources they then rent out, we've got a major problem.

As a society, we need both labor and capital. In particular, we need capital whenever we undertake a project that isn't going to provide goods or services right away, like building apartments - the workers who are building it need to be paid. When we borrow capital, we pay some kind of return on it. We can regulate and tax capital income, and we can tax capital directly (through property taxes, wealth taxes, or inheritance taxes), but the basic reason for capital income is that capital is a factor of production, like labor.
posted by russilwvong at 10:17 PM on March 9, 2021 [1 favorite]

Look, it's clear that your heart's in the right place here, but maybe actually follow up on reading the background material before repeating the same comment a second time? Eg.,

I think it's pretty common to identify the problem as "the rent is too damn high," and the direct response is "keep rents from rising." Thinking about it as "there isn't enough housing, we need to build more, and we need to provide subsidies to low-income renters" is a way of reconceptualizing the problem.

From the individual renter's perspective, the problem is indeed that the rent is too damn high. Again, as I said before, the rest of this is you arguing a bit of a strawman, however. Rent freezes during the pandemic are not the same thing as comprehensive rent control systems. There are several different options as far as rent control goes, including that described in the FPP that you are completely evading, as well as multiple schemes for rent and vacancy control that are more common around North America currently. Total rent freezes have not been a response in most jurisdictions, and while helpful in the short run, do nothing to address the issues that led to rents being too high even before the pandemic (as is the case in Vancouver). I note that we agree on part of that statement, at least, about rent freezes not fully addressing long-term problems. Your analysis and proposed solutions from there are a bit simplistic and out of touch, though.

For example, in a preceding paragraph you note that,

In Vancouver there's a similar problem - because condo prices have been rising rapidly (especially in 2014 and 2015), people have been buying them and holding them empty (brand new in box), expecting to make money from capital gains on resale rather than from rent. In response, there's now annual vacancy taxes that you have to pay if you don't live in a property or rent it out, and that seems to be having a significant impact.

This is a very good observation. It contradicts your earlier statement that "The root problem - at least in Vancouver, which is what I'm familiar with - is that there isn't enough housing to go around". Vacancy rates - as in, housing units that are actually in the rental market (not sitting empty because they are only being held for investment purposes, or in use as airbnbs) are super low across many parts of Canada. This varies by area in the US, however; and the reasons for low vacancy rates vary quite a bit in different parts of Canada. In some cities, removal of units from regular rental markets for Airbnb use is a relevant factor, for example. While airbnb-related issues have been an important (though not the only) factor in the giant jump in market rent prices in Halifax during the pandemic, data indicates that they are not a major contributor to the super low vacancy rates. The patterns of investment and how that affects the rental market are quite different, as well, with units sitting empty due to out-of-town investment being a measureable contributing factor in low vacancy rates in cities such as Vancouver or London, UK but not in many other places. I'm definitely in favor of calling out such factors, as they are particularly obvious and egregious examples of the broken underlying economic dynamics that give rise to housing instability and homelessness in our theoretically wealthy modern economies. But in all locations, neither empty investment units nor Airbnb account for all, or even necessarily the majority, of the issue of lack of affordable housing in the current rental market. There are, instead, underlying basic structural issues in our economic system, that these two factors are just super obviously bad symptoms of. Try not to over-generalize your particular perspective on the one particular city, yeah?

Likewise, the fact that real estate prices are going up across the board in Canada, regardless of whether market rents are up or down locally, indicates that some more complex factors are involved than the simplistic and purely financial explanations you've proposed.

Also, note that vacancy taxes are one option for vacancy controls which is one type of rent control. I suggest looking more into who is the hidden respondent in your statement about "the direct response is 'keep rents from rising.' " and what their actual policy proposals have been. Specificity and more direct phrasing will help you avoid the strawman trap in the future.
posted by eviemath at 5:02 AM on March 10, 2021 [2 favorites]

Look, it's clear that your heart's in the right place here, but maybe actually follow up on reading the background material before repeating the same comment a second time?

Thanks. I did in fact read the FPP (see the first paragraph of my first comment). To me the conflict between agricultural tenants and landlords in 19th-century Ireland seems - in modern terms - like a worker-employer conflict over wages, not leaving enough for even subsistence after subtracting rent based on some unrealistic estimate of the productivity of the land. For example, the productivity of the land might be estimated based purely on total area, not accounting for specific features of the land; this is why court-appointed land valuers, who would actually assess the parcel of land at issue, became so important in resolving the conflict.

The reason I keep talking about housing in Vancouver specifically is that housing is a very local issue, with a lot of local complexities (*). I'd be interested in hearing more about your local housing market (Halifax?). But here, it's not a strawman to say that freezing rents aggravates the problem of scarcity, because that's exactly what the BC NDP government has done in response to rising rents. This was in 2018, before Covid. This is a centre-left, progressive government, and this was a popular policy change. In last year's provincial election, in which they won a majority, they promised to make the freeze permanent.

To me this is a serious policy mistake based on a misdiagnosis of the problem.

If the real problem is scarcity, then what we need is more rental housing, creating more vacancies and forcing landlords (who compete against each other) to bid down rents to attract tenants. An example from today's Globe, describing the downtown Toronto rental market:

The rental market is still suffering from a bulge in inventory that allows tenants much more negotiating power, [Robin Pope] says. Many are demanding – and receiving – cuts to their rent of as much as $300 to stop them from leaving for a cheaper apartment, he says.

“The rental market is fine as long as you have it priced right. But prices have not recovered. Landlords have to negotiate down.”

Ira Jelinek, a real estate agent with Harvey Kalles Real Estate Ltd., says the midtown area around Yonge Street and Eglinton is also seeing a large number of condos for rent.

“A lot of tenants are threatening to leave if they don’t get a better price.”

One owner recently called Mr. Jelinek to say that her tenant is moving out. She asked for his advice on whether to find a new tenant or sell.

Mr. Jelinek’s research showed that the landlord would have to compete with more than 100 similar units for rent.

The small, one-bedroom units that used to rent for $1,800 a month now fetch between $1,400 and $1,500.

“You have 110 to compete with,” Mr. Jelinek told her. “There’s downward pressure on the price.”

Of course "just build more rental housing" is insufficient on its own - new rental housing is going to be expensive precisely because it's new, what you really need for affordability is a lot of old rental housing (like in Montreal), and so in the short to medium term you also need measures to provide below-market affordable housing. In Vancouver the MIHRPP program allows developers to build more rentals if they include 20% affordable units (with vacancy control, so they remain at that level for 60 years or the lifetime of the building). At the federal level the Rental Construction Financing program provides low-interest loans for rental construction which includes at least 20% affordable units for at least 10 years, and there's a $2B Canada Housing Benefit fund (with matching by provinces) to provide direct funding to low-income marginalized rental households. (The federal initiatives are part of a larger National Housing Strategy.)

(*) One particularly promising project that will add thousands of units of rental housing - 12 towers, up to 59 stories high - is the Senakw project being built by the Squamish First Nation at the south end of Burrard Bridge, close to downtown Vancouver. The reason it's going ahead is that the city of Vancouver's housing regulations don't apply to First Nations land, so it can't be blocked by neighborhood opposition.

First Nations in BC never ceded their land by treaty, and the Supreme Court has ruled that they still have Aboriginal title, so they're basically our landlords. Some examples: Musqueam agreement with Vancouver Airport, court battle over lease rates on Musqueam land.
posted by russilwvong at 11:26 AM on March 10, 2021

Buying a rental apartment building - an analysis of what the return on investment looks like in Vancouver.

Someone asked for a tl:dr on the post, here is my shot at it...

Interest rates have been in decline for 25yrs or more. This means mortgage service costs have stayed the same despite bigger loans. This meant that it was more easier to build housing for ownership vs rental. The ability to finance and exit a condo project in 3yrs to 5yrs is much more attractive than waiting for 30yrs for payback from a rental. Sky-high land costs have meant rental owners need to increase rents fast to keep up. But they are constrained by various factors. Therefore, everyone built condos, not rentals, and here we are… looking at a decrepit old brick building for sale at the sweet price of almost $30M and unlevered cashflow yield (cap rate) of 3%.

posted by russilwvong at 11:50 AM on March 10, 2021

But here, it's not a strawman to say that freezing rents aggravates the problem of scarcity
The strawman is saying that rent control = freezing rents permanently, full stop. That's generally not what people are generally talking about when they talk about rent control. Even in the example of Vancouver, you described a situation in which, pre-pandemic, rent-controlled prices were increasing at a rate fixed above inflation ("inflation plus 2% a couple years ago") and are still increasing at the rate of inflation during the pandemic.

in the short to medium term you also need measures to provide below-market affordable housing
Yes. Which is why people are suggesting rules changes related to existing housing, which would have an immediate effect and would address the contradiction that eviemath described. New construction isn't a panacea. If you add new units to a market that favors the warehousing of units whenever prices drop, you aren't necessarily increasing market supply or putting downward pressure on prices. And that's not to mention market distortions caused by speculation, securitization, and short-term rental services. Even without government intervention, we aren't talking about perfectly free markets operating in a closed system, so this isn't a simple matter of supply goes up and demand goes down.

I do agree that, in addition to working toward keeping people in their homes and getting people into existing housing, we need better financing models for construction—preferably models focused on long-term returns in which the goal is to provide a reasonable ROI rather than immediate and runaway profits.
posted by evidenceofabsence at 12:13 PM on March 10, 2021 [2 favorites]

New construction isn't a panacea.

I'd suggest that it's necessary (but not sufficient) - if you can't add enough housing to meet increased demand, you can't solve the problem with rent control. And a lot of cities are struggling to keep up. A detailed analysis of the financial viability of new rental housing in Vancouver.

Is anyone in NYC talking about imposing annual vacancy taxes to prevent housing units from being held empty?

[Freezing rents isn't] what people are generally talking about when they talk about rent control.

Sure. Limiting annual rent increases should be okay as long as actual rents are able to eventually catch up to market-clearing rents. If BC's rent freeze sticks, that will never happen in Vancouver. There'll be more and more pressure for tighter restrictions, like vacancy control.
posted by russilwvong at 10:41 PM on March 10, 2021

Is anyone in NYC talking about imposing annual vacancy taxes to prevent housing units from being held empty?

Yes. As we keep saying, rent control has always (as the original FPP article describes) and still today refers to a more complex array of policies than you seem to realize.
posted by eviemath at 4:02 AM on March 11, 2021

schroedinger Imean, sure, if you just seize people's property without asking and without providing adequate compensation.

You can also mark me down as being 100% in favor of seizing landlord's property with zero compensation at all. They were compensated with the decades, or even centuries, of rent their parasitism accrued.

I'll also note that 100% of all land held by landlords today was seized without any compensation at all from its original owners. Why should I have more concern for the people profiting by their ancestor's bloody and violent land theft than I do for the victims of that land theft?

They "own" the land because some time back their ancestors fought others and killed them to take the land. If that's the legal basis of ownership I say let's go kill some landlords and own the land ourselves. If that's not the legal basis of ownership then they have no claim to the land.
posted by sotonohito at 7:26 AM on March 11, 2021 [1 favorite]

They "own" the land because some time back their ancestors fought others and killed them to take the land. If that's the legal basis of ownership I say let's go kill some landlords and own the land ourselves. If that's not the legal basis of ownership then they have no claim to the land.

If you're sincerely saying that you want to dissolve the legal status quo, I'd suggest that you're playing with fire. Just as democracy allows for the peaceful transfer of power by counting heads instead of breaking heads, the legal system provides a way to resolve conflicts (including conflicts over property) without resort to violence.
posted by russilwvong at 11:24 AM on March 11, 2021

If you're sincerely saying that you want to dissolve the legal status quo, I'd suggest that you're playing with fire.

If you're sincerely saying you accept the legal status quo, I'd suggest that you're a mouthpiece for capital.
posted by Lyme Drop at 12:32 PM on March 11, 2021 [1 favorite]

What Happens to Your Mental Health When You Can’t Pay Your Rent? [NYT] (CW: suicide)
posted by eviemath at 12:41 PM on March 11, 2021 [1 favorite]

For the record, not I am not advocating violence against landlords, nor real estate owners in general.

I was attempting to point out that their claim to land ownership is based on past violence and shouldn't get the respect our socity accords to it. Or any respect at all.

I **DO** support land reform in general and would argue that something like Georgism (though I'm far from a doctornaire Georgist) is a reasonable approach.

I'm not in favor of the idea of private land ownership at all, it seems like an idea that produces very little good and a great deal of harm. Have the government keep it in trust and charge fees for resource extraction, taxes/rents for business or home use, etc.

While I agree that violent revolution is not a great plan, I don't agree that the status quo is tolerable. I'd much rather have land ownership ended via elections and laws than by mobs and executions.

The only question is if the parasite billionaire class will allow the change without violent revolution.
posted by sotonohito at 12:56 PM on March 11, 2021 [1 favorite]

sotonohito: Thanks for clarifying your views, that's very helpful.

I'm not in favor of the idea of private land ownership at all, it seems like an idea that produces very little good and a great deal of harm. Have the government keep it in trust and charge fees for resource extraction, taxes/rents for business or home use, etc.

I know eviemath doesn't like it when I keep talking about Vancouver, but a local example of this approach is that there's neighborhoods where quite a lot of the houses sit on land leased from the city, with a 100-year lease ("leasehold"). The house is still privately owned, but not the land. This makes them considerably cheaper - you're not participating in the "buy high, sell higher" land value frenzy.

While I agree that violent revolution is not a great plan, I don't agree that the status quo is tolerable.

I agree that the status quo in the United States is pretty terrible. My personal approach to politics is incrementalist, focusing on immediate steps to improve the situation - like the $1.9 trillion Covid-19 bill, or increasing the minimum wage as Jason Cherkis suggests, or expanding Section 8 funding as Biden has proposed.

I'm not sure how you would persuade a majority of voters that land should be owned by the public, rather than privately, especially when about 65% of Americans are homeowners.
posted by russilwvong at 1:33 PM on March 11, 2021

Well, of that 65% I'd argue that only 36% are actually homeowners. The rest are paying off a mortage and may or may not ever actually become homeowners.

So in reality 24% of Americans are homeowners, which I'll admit is suprisingly high.

OTOH, land onwership is different from home ownership, as you noted yourself. And I'm definitely not talking about taking anyone's house away.

On the gripping hand, you're also right that Americans will probably not move towards meaningful reform until conditions get much worse. And by then we're probably looking at revolution rather than peaceful transition.

I'm very much not an incrementalist. I will, extremely grudgingly, accept incremental change as being at least slightly better than nothing becuase i'm also very much not an accelerationist. I don't want violent revolution and I reject the idea that by making things worse we can drive the public to supporting a revolution after which magically everything will be peachy keen fine and dandy.

But I also think that incrementalism is like rearranging deck chairs on the Titanic, or perhaps bailing a the Titanic with a bucket. Technially it helps a little, but in the end it isn't enough to stop the ship from sinking.

We need big, major, change in our entire economic system or else I believe there will be a violent revolution. And I'll agree I don't see a path to that change. But I also don't see incrementalism actually stopping the looming threat of revolution. Again, I'll take what I can get, so I don't actively oppose incrementalism, I just think it's ultimately futile.

Revolution sucks. We Americans have a really distorted view of revolutions because the US Revolutionary War turned out very well. But it's an outlier. Mostly revolutions result in things getting worse, not better.

But all the growth is going to the billionaires, all the juice is just about sucked out of the economic boost of the post-war era, and the leeches are still extracting all the wealth from the citizenry they can. It's unsustainable, and collapse is as bad as (or worse than) revolution.

Which brings me back to my general exestential despair and panic attacks over my son's likely future. Because I don't think he's going to get a middle class life, and if we aren't extremely lucky I think he's going to spend his 30's and 40's fighting in a civil war.
posted by sotonohito at 2:10 PM on March 11, 2021 [1 favorite]

sotonohito: Which brings me back to my general existential despair and panic attacks over my son's likely future. Because I don't think he's going to get a middle class life, and if we aren't extremely lucky I think he's going to spend his 30's and 40's fighting in a civil war.

I'm sorry to hear it. I guess one thing making me more optimistic is that I remember the 1980s and the fear of nuclear war. Hannah Arendt, writing in 1951:

Two World Wars in one generation, separated by an uninterrupted chain of local wars and revolutions, followed by no peace treaty for the vanquished and no respite for the victor, have ended in the anticipation of a third World War between the two remaining world powers. This moment of anticipation is like the calm that settles after all hopes have died.

Climate change and widening inequality are terrible problems, but compared to nuclear war, at least they're slow-motion problems.

But I also think that incrementalism is like rearranging deck chairs on the Titanic, or perhaps bailing a the Titanic with a bucket. Technically it helps a little, but in the end it isn't enough to stop the ship from sinking.

You can get pretty far with "crossing the river by feeling the stones" (Deng rather than Mao). It doesn't mean not making big changes, it just means making them step by step. The American lack of universal health care is simultaneously a huge source of suffering, a tremendous burden on the economy, and a black eye for the reputation of the US. Obamacare didn't solve everything wrong with American health care, but it was a step forward, one that Trump wasn't able to reverse. The Covid bill includes funding for expanded Obamacare subsidies, fixing the subsidy cliff. If Democrats can keep defeating Republicans, I would expect more progress.

It doesn't seem unreasonable to me that progressives in the US would aim for something like the Nordic countries: more public programs and social insurance, helping to reduce inequality, funded by taxes which also help to reduce inequality.
posted by russilwvong at 2:53 PM on March 11, 2021 [1 favorite]

Eh, I don't mind you talking about Vancouver at all, russilwvong. It was the over-generalizations, the very incomplete and naive understanding of rent control, and the simplistic market solutions that I was objecting to.
posted by eviemath at 3:45 PM on March 11, 2021 [2 favorites]

When it comes to changing patterns of land ownership or abolishing private property, I'm listening, but we still need to do something in the here and now to make sure people can survive until then.

Is anyone in NYC talking about imposing annual vacancy taxes to prevent housing units from being held empty?
People have been pushing for vacancy taxes for both residential (usually referred to as the pied-à-terre tax) and commercial properties, but without luck so far. Real estate lobbies have a ton of power here so it's going to be an uphill battle.

What Happens to Your Mental Health When You Can’t Pay Your Rent? [NYT] (CW: suicide)
It's kind of off topic, but I really hate the way that we fail to address the root causes of people's problems while using medical and mental health care to treat the effects. Therapy and meds can help, but they aren't going to eliminate anxiety and suffering stemming from economic insecurity, racist immigration policies, police harassment, etc., as long as those conditions persist. There are things that people can't and shouldn't have to live with.
posted by evidenceofabsence at 2:12 PM on March 13, 2021 [3 favorites]