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the govt. decides it no longer wants homelessness.
It decides it wants rents to be low for those on low paying jobs.
Then the govt. proceeds to build, maintain and own a large collection of Soviet style housing blocks to house all these people - funded by the taxpayer.
And let's also imagine that the general public go along with this idea.
What would be the problems with this long term and could it work?
You tax ground rents. This will fore idle land into productive use. If a plot of land is being taxed the same rate as one that has a sky scraper on it, the empty plot cannot be held out of use. In other words the only ones who can afford to hold the land put it to production. Since the revenue will come from the ground, the new income for labor will be more able to afford it, essentially lowering rents.
the govt. decides it no longer wants homelessness.
It decides it wants rents to be low for those on low paying jobs.
Then the govt. proceeds to build, maintain and own a large collection of Soviet style housing blocks to house all these people - funded by the taxpayer.
And let's also imagine that the general public go along with this idea.
What would be the problems with this long term and could it work?
The problem would be worse than the one we have now with people not wanting to work to get nearly rent free apartments. We already have that problem now and the system was created for those who truly needed it on a temporary, as needed, basis not the way it is now with permanent living on the Gov't/taxpayer for life and into the next generation. Please the Gov't., created a monster as it is. Creating jobs and building shelters where the homeless with children get the larger rooms, sort of like a boarding house, but with their own bath one bedroom but have a closed up soup kitchen for designated meal times and no TV's in each room either because it would be a shelter not an apt. Have day care for the low income single Mothers in each town instead of in each County building. This will eliminate the high cost of paying for their apartments and for building apartment buildings. Shelters provide minimal space for maximum amount of people to house. Truthfully I think multi-dwelling homes where the tenants pay the Government to live in without any taxpayer help at all would be best. I think the Government can decide what to charge according to what each person makes just like the Gov't. decides with what write offs and how much tax each individual pays. No need to have the taxpayers involved if it's done that way. They could either build/develop their own multi-dwelling apt's. or have taxpayers contribute towards shelters but not luxury/hotel or apt. type.
Since it's the taxpayer funding it I would vote for the shelters because any housing that gives people their own private apartments to live will prevent people from trying to improve their lives, budget, or even work for that matter, and worst of all it would be a huge burden on the taxpayer who makes too much for the housing/shelter but not enough to support themselves if they had to pay more to support your idea. Don't expect the rich to fund it.
I've seen a lot of empty properties around, that are empty simply because there are not enough tenants that can afford the rent - and I'm talking fairly low income properties too.
I've seen a lot of empty properties around, that are empty simply because there are not enough tenants that can afford the rent - and I'm talking fairly low income properties too.
so what is the good of this?
Empty property doesn't have apartment buidings. Do you mean empty apt. building or vacant building or empty land? not sure what you mean. Either way what makes you think it's because the tenants couldn't afford to live there? There could be other reasons no one lives there.
I mean empty apartment buildings - those set up for the rental market.
In these cases, the landlord deems it in his interest to keep the property empty until a suitable tenant comes along, rather than lowering the prices.
This means that the rent is set at an artificially high price.
So how does this help the economy/people?
When the landlord gets the place rented the landlord, as already explained, uses the money to pay taxes and to hire people to do the work necessary for repairs, etc. etc. It does help the economy. Rents are high because the taxes are high. Right now thanks to 911, Bank Investors, Market Bubble bursting and so on we have high cost of everything not just rent. Everything effects everything and everyone one way or another. There's a word for that but I can't think of it right now. Landlords don't usually deliberately keep apartments empty to hold out for higher rent at least not long term. They may advertise higher and then make a deal with a perspective tenant but you won't know that until you contact the landlord and find out after going for a walk through of the apartment for rent. It may be that the apartment buildings are empty because they are no longer owned, which would likely mean the banks own them due to foreclosure. They could be keeping them because they get a tax write off or because they are unrenable due to being unkept or in an undesirable location.
I don't understand why you want the Gov't to own and rent all multidwelling apartment buildings. That would not create wealth for anyone tenant or not and as already explained it could and most likely would make it worse.
Then the govt. proceeds to build, maintain and own a large collection of Soviet style
housing blocks to house all these people - funded by the taxpayer.
And let's also imagine that the general public go along with this idea.
What would be the problems with this long term and could it work?
I mean empty apartment buildings - those set up for the rental market.
In these cases, the landlord deems it in his interest to keep the property empty until a suitable tenant comes along, rather than lowering the prices.
This means that the rent is set at an artificially high price.
So how does this help the economy/people?
That practice is almost nonexistent in the rental industry. If that scenario does exist it's either waiting to be torn down and something else put in its place or the owner went out of business. There's a big move to go on a self-correcting market based software system in the multifamily industry which adjust market prices based on current and future availability.
For example the end of the month is coming up and you have 1 available 1 bedroom, two available 2 bedrooms and 10 available 3 bedrooms. The prices on the ones and twos will stay high because you're obviously not having a hard time leasing them or have a low turnover rate on those apartment while the 3 bedroom will drop in price till it finds its price on the market. Of course if the apartment manager has a severe case of tinkeritus then the system doesn't really work as well as it can but sometimes the managers can overrule the system and still come out on top.
That's an over simplified example because a lot more goes into pricing but you get the picture.
When the landlord gets the place rented the landlord, as already explained, uses the money to pay taxes and to hire people to do the work necessary for repairs, etc. etc. It does help the economy. Rents are high because the taxes are high. Right now thanks to 911, Bank Investors, Market Bubble bursting and so on we have high cost of everything not just rent. Everything effects everything and everyone one way or another. There's a word for that but I can't think of it right now. Landlords don't usually deliberately keep apartments empty to hold out for higher rent at least not long term. They may advertise higher and then make a deal with a perspective tenant but you won't know that until you contact the landlord and find out after going for a walk through of the apartment for rent. It may be that the apartment buildings are empty because they are no longer owned, which would likely mean the banks own them due to foreclosure. They could be keeping them because they get a tax write off or because they are unrenable due to being unkept or in an undesirable location.
I don't understand why you want the Gov't to own and rent all multidwelling apartment buildings. That would not create wealth for anyone tenant or not and as already explained it could and most likely would make it worse.
I think you're thinking of inflation and the only inflation that affects everything is real inflation and we don't have that right now believe it or not. When we do have real inflation everything will go up including pay all though it will lag behind price increases.
We do have rent inflation right now in many areas because builders can't build multifamily housing fast enough. You're getting droves and droves of people from retiring seniors who are rather well off to former home owners who couldn't afford the homes they had. That trend is expected for the next 5 - 10 years and I'll go out on a stretch and say over 10 years.
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