this post was submitted on 01 Mar 2025
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[–] DarkCloud@lemmy.world 46 points 2 weeks ago (6 children)

Tying the mortgage repayment rate to the median salary of a single individual would go some way towards fixing things then, but that would mean putting price caps on houses which would devalue the currency and also need anti-cartel laws (eg. Laws mandating a maximum amount of homes one can own, as cartels might see artificially low prices as an opportunity to buy up more houses).

Artificially constraining parts of banking and all of residential real estate is likely to have other unforeseen effects on the economy, but may still be worth it.

Another alternative is starting a state bank in which citizens can be part of a rent-to-own mortgage, with minimum but achievable life time repayments. If they don't meet those minimum payments, the house is sold and the profit from the sale is portioned out between the state bank and the mortgage payer in proportion to how much % they paid off.

That's a win win, as theyre probably getting a big cash payment when struggling, and the state bank then gets to relist the home.

Frankly, I LOVE the idea of cartel laws for ownership of residences.

[–] turnip@sh.itjust.works 10 points 2 weeks ago* (last edited 2 weeks ago)

Sounds like you figured it out, since the debasement of the gold standard we locked away an inelastic good behind a mountain of debt, where prices rose to whatever interest rates would allow, providing a massive first mover advantage to those born prior. Then we wonder why nobody has kids.

If housing didn't continue to rise how many boomers would hold it as an investment instead of downsizing and buying an appreciating asset?

This is also why Bitcoin will keep going up and everyone should own at least a little, it leverages the cantillon effect as central banks get looser and looser due to aging demographics and shrinking aggregate demand.

[–] ColeSloth@discuss.tchncs.de 6 points 2 weeks ago (1 children)

The more appropriate fix would be no land ownership by people or countries that don't reside in the US, a banishment of investment companies from purchasing houses, and a hard cap of like 5 properties for any individual or company that can be owned as rental properties.

Far too many people/corporations are being landlords as a big business.

[–] tomenzgg@midwest.social 1 points 2 weeks ago

We might even expand it to all private ownership, maybe…

[–] MutilationWave@lemmy.dbzer0.com 3 points 2 weeks ago (1 children)

That's a win win, as theyre probably getting a big cash payment when struggling, and the state bank then gets to relist the home.

I like your ideas, but where do they live once they get foreclosed on by the State?

[–] DarkCloud@lemmy.world 8 points 2 weeks ago* (last edited 2 weeks ago)

They use their profits from the house sale (which may be substantial depending on how long they've been there + market inflation), to rent somewhere.

That nest egg (which they've been paying into all this time) would give them breathing room and time to recover and get back on their feet to try again at a more stable point in thier lives.

It's a win win because the mortgage payer gets a lump sum, and space to reassess what went wrong. The state bank gets the unpaid percentage of the home's sale price, and then to sell the house again (under a new rent to buy mortgage arrangement).

P.S Part of how this works financially is that most of the money in an economy is created by loans issued from banks, those banks then buy Government Bonds periodically... A state bank would be another entity doing much the same thing, just with a specific purpose in mind.

[–] rekabis@programming.dev 2 points 2 weeks ago

and also need anti-cartel laws

Bring it on. Maximum 5 “homes” allowed per person, 7 for any family unit, children under 25 ineligible for ownership except as a post-death inheritance.

Anything above those limits is landlording-as-a-business, and combined with laws that make ANY business ownership of residential properly illegal, would force landlords to actually work for a living by getting day jobs.

Plus, have an extended “speculation tax” that hits any place being sold with a 100% tax on the first 2 years of owner-occupancy, with a straight-line decline to 0% in the eighth year. Any home being sold where the owner has never lived in it for a minimum of 2 years? 100% tax on the sale of the house straight out of the gate, with all proceeds going to a fund for first-time home owners. Exemptions, of course, for military deployment or death or a few other issues that cannot be leveraged for fraud.