865
'Renters Are Struggling': Economists Back Tenant-Led Push for Federal Rent Control
(www.commondreams.org)
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
this post was submitted on 06 Aug 2023
865 points (97.3% liked)
News
23367 readers
2530 users here now
Welcome to the News community!
Rules:
1. Be civil
Attack the argument, not the person. No racism/sexism/bigotry. Good faith argumentation only. This includes accusing another user of being a bot or paid actor. Trolling is uncivil and is grounds for removal and/or a community ban. Do not respond to rule-breaking content; report it and move on.
2. All posts should contain a source (url) that is as reliable and unbiased as possible and must only contain one link.
Obvious right or left wing sources will be removed at the mods discretion. We have an actively updated blocklist, which you can see here: https://lemmy.world/post/2246130 if you feel like any website is missing, contact the mods. Supporting links can be added in comments or posted seperately but not to the post body.
3. No bots, spam or self-promotion.
Only approved bots, which follow the guidelines for bots set by the instance, are allowed.
4. Post titles should be the same as the article used as source.
Posts which titles don’t match the source won’t be removed, but the autoMod will notify you, and if your title misrepresents the original article, the post will be deleted. If the site changed their headline, the bot might still contact you, just ignore it, we won’t delete your post.
5. Only recent news is allowed.
Posts must be news from the most recent 30 days.
6. All posts must be news articles.
No opinion pieces, Listicles, editorials or celebrity gossip is allowed. All posts will be judged on a case-by-case basis.
7. No duplicate posts.
If a source you used was already posted by someone else, the autoMod will leave a message. Please remove your post if the autoMod is correct. If the post that matches your post is very old, we refer you to rule 5.
8. Misinformation is prohibited.
Misinformation / propaganda is strictly prohibited. Any comment or post containing or linking to misinformation will be removed. If you feel that your post has been removed in error, credible sources must be provided.
9. No link shorteners.
The auto mod will contact you if a link shortener is detected, please delete your post if they are right.
10. Don't copy entire article in your post body
For copyright reasons, you are not allowed to copy an entire article into your post body. This is an instance wide rule, that is strictly enforced in this community.
founded 1 year ago
MODERATORS
We didn't cut off all their profit potential. It's just limited.
I don't really see the problem with this hypothetical. Small time flippers are unaffected. 10% or whatever profit is still profit. If it disincentivizes big commercial flippers or investors because they can no longer make "enough" profit, good, that's the point.
The problem we see when we try to implement price controls is that they inevitably lead to shortages. The oil caps in the 70s are a famous example but the NYC rent controls were just as bad. The standard practice if you wanted an apartment was to look in the newspaper for open house listings that day. You would show up before the open house starts with at least 1 months rent plus first and last months rent as security deposit, in cash. If you liked the place you signed within the first half hour. If you waited someone else took the apartment.
Part of the challenge is that it's not as simple as a 10% profit cap. What if someone owns a house for 2 years? Do we cap it at 20% profit? Do we index the allowable profit to inflation and then add a "reasonable" offset? Do we want to allow different profit caps for different renovations? (maybe we don't want to treat swimming pools and solar panels the same way?) How long do you need to live in a house to consider it owner occupied?
As those regulations get more and more complicated you end up with a ton of loopholes. The more you do that the more profitable regulatory arbitrage becomes as a business model.
In general, tight margins favor large companies over small firms. They can operate at such a large scale where they can thrive off of profit margins that would starve small businesses. That's the general issue with mega-retailers. They operate on single digit margins. Mom and pop can't streamline their operations enough to survive on those margins.
Our housing stock needs both growth and maintenance. That comes from investment. If we push the private sector out of those investments without replacing them we'll just end up with a crumbling housing infrastructure. If we cut large businesses out of it government would likely need to take up the slack. And to be clear that government intervention would need to be massive. The real estate market is huge and if we cut out the private sector we will definitely need to raise taxes, by a large amount, to cover it. That's not off the table but we should walk into a decision like that with eyes wide open.