U.S. CitiesCity-Data Forum Index
Covid-19 Information Page
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 07-28-2012, 09:42 PM
 
1,595 posts, read 2,527,081 times
Reputation: 847

Advertisements

deleted.
Rate this post positively Reply With Quote Quick reply to this message

 
Old 07-29-2012, 10:33 PM
 
Location: Chandler, AZ
5,801 posts, read 5,812,024 times
Reputation: 3119
It all depends on the property owner and the managing company they hire (after vigorous screening ofand interviewing several different property management firms before choosing one) to manage their properties.

Multi-unit investing can indeed be extremely profitable and make you very wealthy in time, even out here in a state as overregulated as California.

The problem is that politicians in some cities are trying to force some very nice communities into making way for Section 8 housing, and the plethora of government entanglements it entails. it can be even more profitable due to the above-market rents which the government almost aways utilizes, which is even higher in pricey areas such as LA, DC, NYC, Chicago & elsewhere.

Hiring the right property management firm remains the key.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-30-2012, 03:48 AM
 
Location: Ohio
3,441 posts, read 5,507,245 times
Reputation: 2689
Okay Kenneth I have a economics question for you, it may help you understand.


You go to the store and buy a bunch of Bananas, how many people did it take to get those Bananas from the field they were grown in to the store?

REALLY think about this now.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-30-2012, 03:50 AM
 
5,190 posts, read 4,367,099 times
Reputation: 1103
what I'm saying here is that the government can own the properties - the jobs will still be created.

But the rents can be kept down to an affordable rate - what is so wrong with that?
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-30-2012, 09:00 AM
 
23 posts, read 59,274 times
Reputation: 29
While rent-seeking as one's primary livelihood is generally not a behavior we would wish to encourage in society (someone living off of rents is someone not contributing to the economy in a more productive way), there is definitely reason to be wary of government involvement in housing. The government has fewer incentives than the private sector to create and maintain housing that people want. It would be thoroughly unsurprising for the gov't to develop the housing people "should" want, as opposed to what they actually do want. If the housing stock is less desirable in a given area due to government control, that means a lower quality of life pretty much by definition.

What I'm hearing from you (correct me if I'm wrong), is that because housing is a necessity and has a captive market to some extent, an entity with a lack of profit motive would keep it more affordable and keep people from being homeless. That all depends on how receptive the government is in investing in housing that people want; Americans tend to be distrustful of efforts to try things like that. The failure of communism has largely proven that the free market is usually more effective than any one single (even highly educated and informed) group of people in determining how the pieces of the economic pie should be distributed. As explained in detail in Economic Facts and Fallacies by Thomas Sowell (something I recommend to anyone who wants to think about economics more clearly), much of the ridiculous housing prices and profiteering in high COL areas such as coastal California, NYC, etc, is in fact due to government policies, ranging from zoning policies failing to allow enough room for high density housing in geographically constrained areas, to the creation of large swaths of "greenbelt" land that developers must leave untouched. Generally, if one gives the private sector reasonable room to create enough housing, they will do so at only modest profits to themselves (how can a landlord maintain exorbitant profits when the other guy can build an apartment complex just as easily?). Despite the leftist rhetoric of the politicians in most of these areas, they actually enrich the private sector quite nicely with the way they carry out policy in practice, at least on this issue.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-30-2012, 11:14 PM
 
5,190 posts, read 4,367,099 times
Reputation: 1103
let's just say in theory then:

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?
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 12:30 AM
 
23 posts, read 59,274 times
Reputation: 29
Quote:
Originally Posted by Kenneth-Kaunda View Post
let's just say in theory then:

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?
It could work, yes -- but the question is whether it will. The main issue is the monolithic nature of government, and the incentives involved for policy makers. When government is the only player in the game, poor administration leads to much more negative effects, because there is no entity of comparable size and motivation to counteract poor policy -- and if such an entity were to exist or be formed, it might be inhibited in its actions due to the monopoly on force implied by a state. If a company is poorly administered, it is only one of many, and those other companies are ready to pounce on any shortcomings, to the ultimate benefit of the consumer. There is also not the same attachment to taxpayer money as there is to someone's personal earnings, and this lack of attachment can lead to ignoring problems. Let me give you two examples:

1. The government owns an apartment complex that is poorly run. Vermin and rodents run rampant through the complex; problem neighbors create chronic disturbances that are not attended to. The government keeps rents artificially low to help the tenants out. The subsidy of their rent, while considered beneficial by the government, creates obstacles that trap the tenants in the poor living situation, because they have budgeted according to this subsidized rent expense. Rent would increase dramatically if they attempted to relocate, making it difficult to impossible to do anything without the government acting. The ball is in the government's court, and government administrators may be blind to the shortcomings or be unable or unwilling to do anything about them. If a nonprofit entity were to build a complex with subsidized rents (there is a Section 8 complex owned by a religious nonprofit in my town, for example), the government would have the authority to harass the nonprofit landlords, create barriers to administrative operations, etc. to avoid embarrassment and keep it from becoming obvious that they are doing a poor job. If a private sector company did this to another competitor, it would be promptly stopped and a punishment instituted, assuming law enforcement and the justice system in this region were any good. This would be poor and very selfish, power-conscious governance, but that is the norm in many countries in the world.

2. A housing development company owns an apartment complex that is poorly run, with the same problems. A tenant can simply refuse to renew their lease, and find a new complex that is better run. Because the developers compete on price points, this new complex is likely just as much bang for the buck. The threat of losing tenants and not making a profit ensures that the company tries their best to make the complex a desirable place to live.

Another main issue, in America at least, would involve the state of our underclass. It was not all that long ago that the government actually did own a large collection of giant towers to house the poor: as someone said in another of your threads, I believe, once the underclass without jobs outside the gray or black markets settled in, these housing projects (as they were called) became a cesspool of crime that few people were willing to enter. The idea would perhaps work a lot better in a place like Japan, where these cultural issues are largely nonexistent. Due to the population density and geographic constraints on their urban areas, they do live in much more cramped quarters than the typical American would expect, but of course it's largely free market. It could work, yes -- but the question is whether it will. There are large segments of our society in which disrespect for authority is idolized, and the police are distrusted. As long as these would be the people moving in, it would be asking for anger and chaos.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 05:16 AM
 
Location: Ohio
3,441 posts, read 5,507,245 times
Reputation: 2689
Quote:
Originally Posted by Kenneth-Kaunda View Post
let's just say in theory then:

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 skip history in school? For your answer actually take a look at post WW2 Soviet Union.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 11:22 AM
 
19,337 posts, read 16,930,256 times
Reputation: 7515
Quote:
Originally Posted by mathjak107 View Post
im a wholesaler. i buy a box and sell a box. thats how i earn a living. i dont creat anything except a service procuring goods my customers want.
I was a wholesaler too, but I sure did more than just buy and sell it. I was also know as a "distributor". That is why the femoral artery is of little use without capillarities. Then there is the trouble one goes through to store and handle it. Its more or less a service. Now if all I do is own a river and sell access charges, there is still a free ride that exists in the total package to anything that I might add to it. See how much one will pay to rent a raft when you have no river.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 11:50 AM
 
19,337 posts, read 16,930,256 times
Reputation: 7515
Quote:
Originally Posted by Badlands17 View Post
While rent-seeking as one's primary livelihood is generally not a behavior we would wish to encourage in society (someone living off of rents is someone not contributing to the economy in a more productive way), there is definitely reason to be wary of government involvement in housing. The government has fewer incentives than the private sector to create and maintain housing that people want. It would be thoroughly unsurprising for the gov't to develop the housing people "should" want, as opposed to what they actually do want. If the housing stock is less desirable in a given area due to government control, that means a lower quality of life pretty much by definition.

What I'm hearing from you (correct me if I'm wrong), is that because housing is a necessity and has a captive market to some extent, an entity with a lack of profit motive would keep it more affordable and keep people from being homeless. That all depends on how receptive the government is in investing in housing that people want; Americans tend to be distrustful of efforts to try things like that. The failure of communism has largely proven that the free market is usually more effective than any one single (even highly educated and informed) group of people in determining how the pieces of the economic pie should be distributed. As explained in detail in Economic Facts and Fallacies by Thomas Sowell (something I recommend to anyone who wants to think about economics more clearly), much of the ridiculous housing prices and profiteering in high COL areas such as coastal California, NYC, etc, is in fact due to government policies, ranging from zoning policies failing to allow enough room for high density housing in geographically constrained areas, to the creation of large swaths of "greenbelt" land that developers must leave untouched. Generally, if one gives the private sector reasonable room to create enough housing, they will do so at only modest profits to themselves (how can a landlord maintain exorbitant profits when the other guy can build an apartment complex just as easily?). Despite the leftist rhetoric of the politicians in most of these areas, they actually enrich the private sector quite nicely with the way they carry out policy in practice, at least on this issue.
The reason is scarcity creates rent. Rent is the economic free ride. We see the same free ride in North Dakota where high wages just drive up real estate values. Sure, more housing will be added but there is no escaping that in the end, all the wealth will go to real estate and those who finance it.


Now however anyone wants to look at it , I just don't understand why we tax labor and capital when there are all these do nothing windfalls to find revenue.

I like Thomas Sowell, but at some point you cannot just add more housing. He seems to believe that additional labor will always stifle rents. We must have revenue from somewhere but he does not point out that direct taxes on labor are squarely against the classical school. Why doesn't he advocate luxury taxes and land taxes like Adam Smith? I am not talking about more, but why are we financing it as is without a peep of how vile a system we have now? Why do conservatives hate welfare while other legal unintended consequences make welfare queens just the same?
Rate this post positively Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Similar Threads

All times are GMT -6.

© 2005-2021, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top