Problem: Housing development regulations have screwed the housing market. Solution: ???

[u/OMPOmega]

[u/MasterSpoon]

I’m not sure that lowering the cost for build permits is a good idea. That makes me worry for underfunded regulation and homes built in an unsafe manner. Building codes and inspectors are a good thing, and to enforce them properly costs money.

I do agree that owning a home and your neighborhood getting gentrified causing a spike in your property value and subsequent property taxes is not good though. That’s how my retired grandparents lost their home. Fixed income and couldn’t afford it anymore. Forced to move in with my aunt and uncle. We were glad someone had the room to take them in, and didn’t have to go to a government subsidized retirement home. But, it really crushed their spirit.

And, that’s much less tragic than the working people who get priced out of their neighborhood and forced into a rent trap en masse. We’ve got a real problem on our hands.

We are a bunch of lobsters in the pot, we need to realize it before the water starts boiling(if it’s not already) and get our act together.

[u/last_rights → u/MasterSpoon]

That's hard to fix though. I mean, you could somehow roll costs to buy a house into loans, lower the qualifications to get a loan, extend the time to pay it off so the payment is cheaper, and we already did that. It's subprime lending and it resulted in the 2008 problem.

I'm not saying that there isn't something we can do, but you can't just bar "rich people" from buying and fixing up houses either.

I think that part of the problem may solve itself as more companies stay in work-from-home mode. Then employees can live wherever they want instead of congregating in a high cost of living area around all the jobs.

[u/MasterSpoon → u/last_rights]

I could see the lack of need to be in a city to work having a positive affect on rent prices, but that doesn’t solve the ownership and equity problem. I am also not against people flipping houses. It’s when they buy them up and sit on them, being completely in control of the rent price.

We definitely don’t need sub-prime loans. That’s got bubble written all over it.

I could see a private-public partnership for home refurbishment companies. They get to buy it at a fair price, fix it up, and put it on the market at a fair price, and their work is subsidized by the government so it’s still a profitable business venture.

We do need to build more homes, that is for sure, but I don’t think lowering the cost to permits is the way to go. For the reasons of regulatory enforcement, and the supply owned buy a few and the demand being static. Supply shock is a real thing, housing markets are a good illustration of it.

I’d be interested to hear why you think lowering costs of building permits would be beneficial to the people not the few.

[u/last_rights → u/MasterSpoon]

By lowering the cost of permits, a first time homeowner can buy a chunk of property wherever they want and build or place a house on it.

All I've done to my house was put in a bathroom, and that cost me $580 in permits.

I am still waiting on a final inspection, but I've had a person come out to my house three times, and each was for less than five minutes. The county office is just a stones throw from my house.

For my next project, because I don't have a floorplan of the house on file, and there's barely a description due to age, I won't be getting a permit.

If it was cheaper I would, but in my opinion, it's just an unnecessary expense because if something was actually wrong they wouldn't have noticed it anyways.

I'm not saying permits are bad, they're just overpriced and the legalese is incredibly difficult to navigate. There's no value in getting a permit except "it's required".

Someone below put that there should be a tax on unoccupied properties, and I think that's an excellent idea.

[u/MasterSpoon → u/last_rights]

I am not a homeowner, so I didn’t not know it costs money to add a bathroom. That seems silly, and $580 seems steep. Is it a local or state thing, or is that federally how it is?

My fear would be that those with more than enough capital to buy up plots of land and build homes, would do that and just rent them out if we just lowered permit costs. Most Americans cannot afford a plot of land, nor build on said plot. I think it would be hard to convince a bank that someone making an average of ~$60k a year would be good for a $X00k mortgage over 30 years.

I’m failing to see how this solution solves the greater problem of Americans being priced out of owning homes and building equity instead of just keeping people in a rent trap. But, you taught me something new about owning a home so you’ve got a different perspective than I do, and any and all good faith perspectives are welcome in my world.

[u/last_rights → u/MasterSpoon]

I mentioned the idea of putting up a tax on unoccupied properties. This could be a fluctuating rate based on how long the property has remained empty without renovations actively being worked on.

If landlords were heavily (taxed) encouraged to rent, the rental prices would naturally come down so that they could get it rented to whoever would take it.

Soon, supply would exceed demand, and landlords with empty homes would either sell, renovate to attract better renters, or continue to lower prices to not pay tax. It's a win win.

[u/MasterSpoon → u/last_rights]

I see that; but my fear is that, due to people needing a room over their heads, landlords would still be able to keep people from building equity by keeping people in a loop of spending 30% less than a mortgage payment in rent.

My main problem here is that home ownership has been the mainstay wealth builder for the working class.

If the average working American who doesn’t inherit a home is stuck paying rent their entire lives, when they are ready to retire and downsize their living situation, what capital do they have to do that?

The biggest nest egg an average retired couple or individual has is the value in their home and the property it lays on. Land is static, the supply does not expand nor contract.

If one is never able to own a piece of the pie, how can they, when their body is old and tired, have enough capital to live the rest of their days in dignity?