I think the difference with the first 5 is that a manufacturer sets the price, scalpers purchase it by that price and sells it at a much higher one.
The house price just fluctuates continuously and when the “investor” or “scalper” purchases it, it was available at that price for everyone (or did he purchase it from another scalper?)
Yes, the problem is the high prices of houses, but to reduce it we need to either increase supply (encourage building more, perhaps changing zoning laws to allow more homes etc) or reduce demand (increase interest rates (that though make it harder for regular people), restricting corporations from purchases, banning Airbnb (yes, they drive prices up, and if you use them, you are contributing to it), penalizing if unit is not occupied (though enforcement of this will be hard), or banning foreign investors.
Land. Value. Tax.
Value.
Tax.
It’s wild that you don’t see how exploitable such a tax would be. Specifically, it would make gentrification occur more easily and quickly.
If a developer became interested in rebuilding a poor neighborhood, their interest alone would dramatically raise the land value of the area. The now untenable tax burden would force the current residents to move out, and because the developer would be the only one interested in buying, the developer has nearly complete control over the sale price.
LVT is already a thing in a bunch of places… How come we haven’t seen these dramatic gentrifications happen?
For existing houses the investors might very well overbid the market price to get the lot, thereby making it inaccessible for any individual to realistically buy. They’ll gladly overpay the market price on adjacent lots so they can “regenerate” the area, by stuffing four houses into two lots. Any individual simply wanting to buy the existing lot is out of luck, because it wouldn’t ever make sense for them to overpay the asking price.
For new lots, it works so that whenever a city council decides to change the zoning of a lot of land to allow for residential construction, the price is set for investors to bid on. The entire lot is bought by an “investor” or “developer” who will either build on the lot or sell individual parts of the lot for others to build on. There’s no risk. There isn’t necessarily any work carried out. There’s no service provided. It’s just paying for ownership at one price, shuffling the papers and selling at a higher.
It’s the same fucking thing as scalping, only over longer time and for larger amounts.
So the idea that “If it’s so easy, why doesn’t everybody do it?” or “It’s fair, because they paid above asking price, you could just have bid higher” is wrong because I for one can’t afford to buy ten fucking houses just to get one of them at the right price.
This is how capital accrues.
I don’t enjoy the whole foreign investor solution, I think it’s a scape goat.
It matters little to me if the person fucking me was born in China or 10 miles from me. Being born in this country doesn’t mean you can screw over the rest of the population.
I’d rather see hard limits on how much property one can own. There is no reason for anyone other than the state to own those huge apartment complexes. Dismantle the land barons class, no one should own enough to house thousands.
I think a less heavy-handed way of doing that is, every person can have 1 (one) permanent residence, and all other property you own incurs a much higher property tax. If you’re filthy rich and want a couple of houses, fine, but you’re gonna get taxed for it. But that will stop speculative house buying, more or less. Of course, this will never happen because states race to the bottom to offer low taxes to attract rich people. Another issue is, what if someone wants to live in a house but can’t afford to own it? Renting is the best option for a lot of people. I think that is solvable, but my idea would inevitably take a lot of property off the rental market.
I don’t think it is a scape goat. For example, many people from China are not trusting Chinese Yen, they often purchase property purely to hold value and won’t even rent it to others, because it would cause wear and tear. So it is basically a wasted unoccupied unit.
As for your suggestions I totally agree.
Americans do this with property too. If we only regulated foreigners from doing it, that would allow american investors the opportunity to do it more beduase they have less investors to compete with.
If you allow foreigners (keep in mind that those who do this, but only are very rich in their countries, but also are very rich compared to you or me) to purchase property now you not only have demand created by locals but you are adding foreign demand. This all drives the price up.
Even if Americans would do the same thing the prices would be still lower, because now they are out priced.
How much property is owned by foreigners paying taxes while not collecting rent? That sounds nuts compared to just holding the dollars they’d use to buy the house in an offshore bank.
The house price just fluctuates continuously and when the “investor” or “scalper” purchases it, it was available at that price for everyone.
That doesn’t mean everyone (or people who needed it) have the ability to purchase it. The down-payment is simply too high that most people who want a house cannot afford it.
This is the same as scalping other goods, they have a unfair advantage in the market, and then they can make back all their money via rent and selling the house. They have nearly no way to lose in this game.
The unfair advantage is what making people angry; they are not making money by labor, insight, or even luck. The only reason these people are becoming richer is because they started rich.
I absolutely agree with your solution BTW, just arguing that people scalping houses are very much brain-dead scalpers. Many of them probably don’t even care about the basic human right to shelter.
restricting corporations from purchases, banning Airbnb (yes, they drive prices up, and if you use them, you are contributing to it), penalizing if unit is not occupied (though enforcement of this will be hard), or banning foreign investors.
Agreed, we should be doing all of those things. Corporations should not be able to own any kind of housing at all, and multi unit buildings should be under non-profit co-ops.
And to penalize unoccupied housing, we should have a georgist taxation system.
The only time it makes sense for me for a corporation to own a residence is if they have a need to put up their own employees in that area regularly, or if I needed a manager living on site (like some storage facilities have). Corporations should not make their money renting or buying/selling single family homes.
I don’t think there are enough such edge cases for it to make sense for it to be legal.
If a corp needs an employee to be that close, then they should hire local, and/or rotate staff.
At a bare minimum, I agree, no corp should profit off of housing.
I’m not sure I’d agree that corporate ownership is necessarily bad If you want to rent an apartment because you don’t want to buy into a co-op then how do you go about this? Someone needs to own the apartment to rent to you Personally I don’t mind if that initial investment comes from a person or a corporation
Could you rent from the co-op at cost without buying into it?
That’s how a lot of co-ops works. Or maybe it’s called non-market rental. I don’t remember the exact name but it’s definitely a thing.
Either way, landlord parasites are not needed.
Who are you paying? Other owners of the apartment? So they put in extra up front so they can rent to you? If so do you get to pay back their initial investment over time? If it’s non profit does that mean they can’t take anything in excess of what they paid or do they get payed x amount over the top?
I’m fine with co-ops generally but when it comes to rentals I just don’t see how you’d make a “not for profit” rental But I mean if someone wants to set one up and prove me wrong that’d be cool. In theory nothing is stopping them
I was actually asking a question. So anyhoo I just Googled it and it’s called a “zero equity co op” if you’re curious.
The house price just fluctuates continuously and when the “investor” or “scalper” purchases it, it was available at that price for everyone
The goods from manufacturers are available at that price for everyone too, right?
And then as another commenter said, sometimes down payments on housing are outside the budgets of certain groups in society - a point I suppose you can also make for the manufactured goods too.
I think the difference with the first 5 is that a manufacturer sets the price, scalpers purchase it by that price and sells it at a much higher one.
I don’t see the difference here with housing. If a real estate owner buys a property then sells that property for higher than they purchased it, the market will either respond by buying or not. The same is true for manufactured goods: if the price set at MSRP doesn’t not elicit a response from the market, then the manufacturer may lower their prices until a response is drawn - or hold out until the rest of the economy shifts (a gamble on the part of the manufacturer).
I don’t think your reasons substantiate your claims.
Buying up enough of something so that you’re one of the only names in town is a “smart business move”, because then you can start to charge whatever prices you want. Totally not scalping. You see it in private healthcare, food, newsmedia, streaming, telecom.
Capitalism is both disgusting and predictable.
Not just buying it up, of course, but making the market openly hostile to any kind of competition.
Maybe that’s through state regulation. Maybe that’s through some smear campaign. Maybe that’s through leveraged buyouts or vertical integration or just doing a little industrial espionage to fuck over the business next door.
Just ask Aaron Swartz what happens to guys who try to foster open-sourced alternatives to cartels and monopoly concerns.
I’m actually a huge fan of scalping and hope it happens more. Here’s why: many of your more dim-witted, more or less middle-class “free market” bros will gladly tell you that the value of a good is set by supply and demand. Hospital care is so expensive because there are comparatively few doctors, MRI machines, etc. in comparison with the entire population. Houses are so expensive because everyone wants a house and it’s an appreciable asset. I’ve seen these people my entire life. They’ll decry socialism and make the age old joke that “socialism is when no potato.” But the second a PS5 gets a street price of 700 bucks, suddenly they become walking “Homer Simpson fading into the hedge and coming back out wearing a different outfit” memes. They’ll say things like “scalping should be illegal” or “the government should step in to make sure that the actual consumers who want one can get one - nobody should be allowed to buy 500 of them and just sit on them forever.” Suddenly, market economics produces a state of inequality that doesn’t directly benefit them, and the guiding hand of the government should be used to ensure equitable distribution of resources. Not that they’d ever reflect on this in any way or consider how their personal experiences indicates a larger set of structural problems with the economic systems that produce such a state of affairs.
It’s free market exploitation. If you believe a free market can exist without regulations, you’re imbecile.
Just imagine: People need fridges. All fridge manufacturers agree to raise prices of a fridge by 2000%. So what, people are going to stop buying fridges? No - because they need them.
You would say: it’s a free market, some new manufacturer is going to offer fridges at regular prices. Well - no you dumb fuck. What’s the incentive for the new fridge manufacturer to sell at lower prices, when people are going to buy fridges anyway, because they need them? The answer is - none. It would be a dumb business decision, because your supply is limited, and you’re going to sell it at market price, because that item is essential.
So how does the economy even work if that’s possible? That’s right idiot - because it’s price fixing and it’s fucking illegal.
The incentive here would be that a new company could sell far more fridges when reasonably prices compared to their competitors and take all of their market share
But yes of course govt regulation is required when there is actual price fixing going on. I’d also like to know the alternative way of pricing goods/services from people with the alternate view
Your goal as a company is not to sell as many, but to make the greatest profit. So let’s say that the new market price is $3 000.
You’re the new company. Your supply is 20 000.
Do you
a) Sell fridges @ $2 950/each, undercutting competition while selling whole supply, because of demand being higher than your supply, making $59 000 000?
or
b) Sell fridges at a reasonable price of $400, selling the same amount, because your supply is limited anyway, making $8 000 000?
The company still has no incentive to go B route. They only need to undercut the competition, not make prices reasonable.
Free market self regulates, provided nothing artificially screws with supply and demand and there are competitors. Both scalping and price fixing screws with it. It is literally the cancer of free market, and people screwing with it call themselves “investors”, while actually destroying the economy.
It is the government’s responsibility to prevent those situations before they happen, otherwise these changes may be irreversible.
Btw. A situation like this was happening recently in the GPU market. Nvidia had a crazy high demand for their GPUs because companies invested in AI were going to buy these cards no matter the price. So they bumped the prices like crazy, and they were instantly sold out.
Meanwhile Nvidia’s competitor - AMD - didn’t have nearly as strong GPUs for Ai as Nvidia. Do you think AMD’s prices stayed the same? Nope. They bumped it just like Nvidia, barely undercutting them, because there was still demand, in fact growing demand, for GPUs for gaming, while AMD’s supply was obviously limited.
2 years later, lower demand, GPUs actually in stock, but prices are still fucked (though not as much) because people got used to it.
I don’t think you ever took even economics 101 in school because for almost all products there exists a price where you can actually increase your profits by decreasing the price because the larger sales volume offsets the revenue lost. Applies to your fridge example as well. You just assumed the same sales in both scenarios which is not even close to being realistic. And your Nvidia/AMD example ignores the high inflation seen during that period.
They are making the assumption that demand is constant because the product is a necessity (such as with something like insulin). Profit at higher volume and lower prices only happens with products with elastic demand.
In this example this new company would probably sell fridges at a whooping discount of some 5% and still be able to sell more although the price is 1990% of the original
The point being that if company A cuts their price to compete, and company B has an artificially inflated price
Now we have company B with no sales, and are forced to match or beat their competitor
Repeat until the price is fair. This breaks if both companies are co-ordinating with each other and forcing all other competition in line. But that’s a crime and would be regulated
This take is basically accelerationism. That if something is bad it will inspire more people to change their opinion. Your take is fine, I guess.
I agree with the sentiment but feel like it doesn’t really work that way. It’s what I learnt from 2020 at least, whenever things turn to worse, people would rather do nothing than change anything. That makes a bit afraid of how bad should something get for changes to occur
This is an important observation. You’re probably more right, that things can get worse without people caring. Sometimes when we say things will get worse unless we do something, that does prevent a bill from passing or someone awful getting elected or some business going bankrupt etc.
man that’s a lot of words to say that a theoretical person is a hypocrite
I’d rather have retailers and manufacturers agree on a way to start prices high, then bring the price down towards the target MSRP every time the item is back in stock. That prevents scalping, let’s consumers decide exactly how much “get it early” tax they’re willing to pay, and gives the money to the people that did 99% of the work.
The simple reality is that if there are more people interested in a good at the current price than there are goods available, you must select a way to figure out who gets those scarce items. Raising prices and lotteries where you verify everyone participating is a distinct human are probably the most fair options.
Economic liberals being dumb. Truly shocking. Now tell me a story about how conservatives are dumb.
He just did.
I feel like North America could fix its housing issue by simply abolishing the single family housing zones
No. Every American should be able to have 40 acres and a mule.
What do you mean, that’s more than 5x the total acreage of the US? This is a minor problem, we’ll just make more land or steal some more from the Indians.
What are your thoughts on a platform city like the one in Final Fantasy 7?
they could fix the housing crisis by regulating the market.
They could also fix it by deregulating the market.
They could also fix it by doing basically random changes to the law, because the law currently is perpetuating the crisis.
Fuck it. Put a pen on the jaw of a goat eating grass, and write the result into law. I think we actually have a shot at improvement this way.
De-regulation in general has been an unmitigated disaster.
Yeah, I’m absolutely not saying deregulation is a good idea, just like goat-law. I can see how my comment read though, rewrote a bit to make the cynical undertone a bit more obvious.
I was only pointing out that the current, specific set of laws, is keeping this problem a reality. That it’s not a particularly natural situation to be in.
My apologies, downvote revoked. I mis-read your post.
“deregulation” detected. ready the down votes. /s
Seriously though, zoning laws are a big reason why we have the current housing crisis. If given the opportunity, someone or some business will build high density housing. But you can’t with he current implementation of zoning laws. Without that barrier, you would see a lot more high density building projects
Still we do need zoning laws. I don’t think anyone wants a factory or a garbage dump in their back yard. Used correctly zoning also helps limit sprawl.
I think there’s a blind spot on the left for this one. Opening up zoning for higher density is effectively a giveaway to local developers, who are invariably shitbags. It’d be preferable if solutions like banning corporations from owning housing could be enacted.
That’s based on the theory that there are enough houses and flippers and hedge funds are just sitting on them in order to rake it in later as property values are driven up. If that were true, we’d expect to see large vacancy rates in cities. Problem is, we don’t. My city has <4% vacancy for rentals and <1% for home ownership. This seems to be similar to the numbers in many other major cities in North America. If we got rid of every corporation that was sitting on a house unused, the available housing would go up by 4% or so, at most.
We need more housing stock. As it stands, the only way to do that is a giveaway to shitbag developers. They’re the ones that hold the capitol for building more housing.
This could be mitigated by city councils also encouraging/mandating those developers to have unionized staff.
We have like 16 million unoccupied homes as of 2023.
How many are in cities people want to live?
Not gonna speculate on that.
I know this is quite a bit later, but this comment confused me. I do not see how loosening zoning laws that limit density and banning corporations from owning houses are mutually exclusive.These policies can and should work together as part of a bigger urbanist policy. I also don’t see how supporting local developers is that bad of a thing. I’d rather have the money stay in the community and go to a community member than some multinational corporation who owns thousands of homes across the country. Still it isn’t the best. Cooperative housing or need based housing who is better, but realistically those can’t fill up the excess of stock that we need. We will need input from private developers, as well as a big government housing initiative.
They aren’t mutually exclusive. Many of the proposals out there treat it as if it is.
Zoning laws in the US are particularly fucked. This video breaks it down quite nicely, I find.
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Here is the thing North Americans love single family homes.
How would you know, North America is literally missing the opportunity to have new development of things other than single family houses or apartment big buildings, bet you there would be a lot of demand for midrises, row houses, mixed neighborhoods in general
Row houses maybe, but there’s an adversity to condo fees which usually come along with every other source of housing. A lot of people want to feel like they own their home outright, so that once their mortgage is done being paid off, all they need to worry about is the hydro, water, and property taxes. There’s a lot of stories about condo groups doubling condo fees that put others off those types of places.
I feel like every single family home has HOA dues, these days, so that comparison is kinda moot. Whether it’s condo fees, HOA dues, or the local cartel extorting you for protection, you’re gonna get nickel and dimed.
I feel like every single family home has HOA dues, these days, so that comparison is kinda moot
Narp. I wouldn’t buy a house in a hoa ever again, and haven’t had issues finding the last two I lived in (in both large and small markets).
Both are true, she point is those with the single family homes now wont get out of them
Developers in my city are building apartments like mad and filling every single one of them. The common council finally opened up zoning for row housing in the past year.
In Charlotte, NC where I last lived. They were building apartments like crazy, but all “luxury apartments” and charging $3-4/sq ft.
$1850/month for a 600sqft apartment wasn’t really sustainable for a lot of people.
Idk, its not like there’s no housing shourtage/rant gauging in other countries with more sensible zoning.
It’s a zoning problem all along. See: Canada, Netherlands, Ireland…
Zoning is irrelevant. Perfect zoning laws could mean 10x the houses - and the investors will buy them all up and supercharge property prices all over again.
How many houses are sitting unoccupied like that in your city?
Impossible to know, but there are 16 million unoccupied homes as of march 2023.
I’d rather die in a fire.
Do it then
You first, rat warren enjoyer.
I don’t see anyone stopping you
Same. I’ve lived in all the basic types of housing: apartment, duplex, house, etc… If I liked being woken up at 3am by some drunk asshole stomping around in the apartment above me or some kid storming in because they don’t understand addresses yet, then I would be doing that already. Maybe other people enjoy that sort of thing? You can have your congested living conditions, but leave me and my single-family zone out of it
I don’t know why this is controversial. It’s just a fact at this point.
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It’s not scalping if you bought them on the secondary market, it’s hoarding.
We’ll you see if you’re making people pay extra for their human rights that’s called investing. Not puny recreational items.
This is a joke. But it is a pattern I noticed in this sample.
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You don’t think people are actually going to read this with all those ridiculous emojis, do you?
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I read it all. Why do the emojis offend you so much? They’re just tiny pictures.
I mean this sincerely and not as a hollow insult: you’re too cynical. Give the internet a rest for a while and get some endorphins flowing. You’d like it…and we’d appreciate it.
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yeah someone needs to stop the Chinese from buying up residential property everywhere
If only there were some sort of governing body that could regulate things like that…
Over here foreign investors are banned from buying property, they can only build property. Unless you send your kid to uni here, then it’s all fine apparently
And if we in the US tried banning foreign investors buying houses we’d be called racists. It needs to be done. I’m tired of not being able to afford anything where I live
Oh don’t worry we still can’t afford anything. Median house prices are over a million dollars AUD and in terrible condition.
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Yes, we should ban foreign investors. Especially the US companies that want to profit from our housing scarcity.
No one should be able to, regardless of where they come from. China is a scapegoat.
Op has right idea but terrible phrasing. Sounds racist (well, xenophobic) and I actually started trying to type a (tongue-in-cheek) racist response, but I couldn’t get the tongue-and-cheekiness strong enough to be clear I was mocking it.
Not a scapegoat but the current largest offender.
Domestic corporations outpace them by quite a bit. Even if you only look at foreigners, China only accounts for 13% with Mexico at 11% and Canada at 10%.
We should aim to ban everyone from doing this. If no one, domestic or foreign, can abuse of the housing industry, the problem goes away.
If only China is banned from doing so, the vacuum gets filled in the space of a day and the problem persists.
Technically, China did… They’ve limited yearly investment outside the country to ~$20k, which would significantly dampen it. They’re even cracking down on the multi millionaires
Granted, laws don’t seem to work on billionaires or multinational corporations. China having those is a problem…
The US ones are really doing a number too… Investment funds like Black Rock gaming the market have been the biggest issue, they’ve been snatching up everything at a bit above market rate or below in an area, which makes the price skyrocket. Some of them are renting them out and driving up rent prices, but a lot of them are just collecting them like Pokemon cards and leaving them empty until they (presumably) decide it’s time to sell.
Granted, that’s probably more like billionaires all over the world collectively doing it indirectly
I flip items all the time, but they are items that very few people want, so I’m providing a service to the few people who need the things that I sell. If anybody needs any vintage vacuum tubes, I have several hundred. I have a Pentium III laptop. Good luck finding these things out in the wild if you’re looking for them.
So how much for the tubes
Tree fiddy
GAD DAM
What’s the point of the laptop?
Some need an actual old hardware for research, for improving emulators, for testing compatibility, for porting specific software. I would guess it may have more uses, but those are ones I know of. And for display in a museum, too
NASA needed 8086 chips till they retired the shuttle. They were paying good $$$ for the things as well. Dunno if anyone would need those things anymore at this point.
Ahh thanks. I thought he meant it about a singular laptop.
They aren’t manufactured, you have to buy them from people second hand.
I think they are specifically talking about housing as that is a basic need.
People don’t understand the difference between reselling and scalping.
They’re all investments. Most of these products are specifically setup by artificial over demand and under production to be profitable, basically exploiting the fact that there are 8 BILLION humans and a small group have most of the money.
Shit like this wouldn’t work in a stable global economic system that wasn’t headed for collapse on a bullet train
They intentionally produce too few and demand goes up due to fomo.
its called rent seeking for a reason
Just an inherent consequence of capitalism. If people are willing to pay much more than the price that was set by the manufacturer, it’s their loss and a business opportunity for third parties.
Yep, so we should abolish Capitalism.
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So you will own nothing and be happy?
Who will produce things without incentive as monetary gain through which they can acquire things? Noone
That’s Capitalism, buddy. I’m advocating for Worker Ownership of their own labor, and collective ownership of the Means of Production. Personal Property is fine, but the end goal of Capitalism is everyone renting everything from a few Capitalists.
They tried it and people just sold their shares immediately to some guy buying them all and bought vodka and cigs
All I want nowadays is just equal opportunities to everyone to amass capital which probably would abolish inheritance first and then regulate market to protect from monopolies.
It’s a race and war but at least make the rules fair. Then those who win they win and lose they lose but it was a fair fight
Just make workers share ownership and unable to have unequal shares. Ez.
Who will produce things without incentive as monetary gain through which they can acquire things? Noone
Do you clean your room?
On a more serious note, Communism is a future ideal, money would still exist until its possible to abolish. There are tons of writings on this that can help elaborate, why do you believe work must be done with monetary inventive?
Edit: oh yea, you’re the landlord everyone called out a while ago, and rather than making any points to defend yourself you just pretended you were superior. Lmao
I clean my room because it gives me a feeling of order.
I do not work because i like work.
I work because i have to so that my children don’tYou like the feeling of order, so you work. Seems like a non-monetary motivation for me.
You also think worker ownership of the Means of Production is Capitalism if it has profit, so I think you’d do better by actually researching what you talk about first.
There are systems with private property and property rights, this anything other than capitalism = the most extreme version of communism shit is getting real old and people should be shamed for persisting it’s hyper-bullshittery.
I blame reddit for nurturing extreme thinking
Cirno doll > house
Is Cirno in high demand?
No but the cursed astolfo bean plush is
No fucking ice fairies allowed, bitch!
Whew, that’s a sentence you’ve got to be careful with
Based
So either all are wrong or all are right. Which is it? Cuz I know people who complain about house flippers, but are totally willing to scalp products like these.
Scalping is wrong, and scalping houses is worse.
No, all is just as bad. Scalpers are preventing people from getting things that they want unless they pay a premium. They’re not contributing anything to society at all.
The difference is want vs need. You can live without a ps5, not so much without housing.
Yes, but luxuries are not as bad as necessities.
