RE: Property Sucks
What about risk? What is the value of risk? Should people be rewarded for taking on risk when others are unwilling to do so?
Example: I own a rental property. We had people in it for a long time who, unfortunately, could barely afford it (though they certainly had a lot of junk including TVs larger than ours). Though rents all around our property went up, we kept ours the same. We accepted their late or incompletely rent payments, and we were happy when they could make them up a little at a time. We often got notices about the yard not being kept up, and later we found out from the neighbors how they were, well, terrible neighbors. They also trashed the place with junk over the years they were there.
A couple months ago, they almost burned the house down. $50k in damages, including a new roof.
Should we have kicked them out years ago and rented to others who would appreciate the value of the risk we took on to invest in that property, repair, and maintain it? What value can be given to the money earned to purchase the house in the first place and take on the risk of renting it to others?
Maybe my example isn't helpful because you're talking about an empty property. Well, right now, our property is empty. The repairs are finally done, and our property manager is in the process of looking for new tenants who will respect the house and the neighborhood. If a squatter were to live in it now, that would dramatically impact our ability to find a tenant who would appreciate living there. It may not harm me personally in a physical sense, but it would take away value from me as I'm still paying the mortgage. If people staying in that house without my consent prevented me from renting it out to someone else, is that okay?
We had much the same situation with the first home we ever owned, moving before it could be sold, the proceeds of which finally helped pay for a new roof, drilling a needed new water well (over $7,000), carpeting and flooring throughout our third home (the one we finally lost to the greedy tax and spend into economic oblivion state).
It took us several years before we could sell, and had to pay over a thousand dollars to renovate our old $25,000 home due to bad tenants, who even stole the circuit-protected kitchen electrical outlet I installed to remove this potential hazard while we lived in the home, replacing it with a dangerous unprotected outlet, which I paid to replace again before selling.
We had been homeless briefly before finding this home, living in a pickup truck camper and hotel rooms briefly with four children and another on the way, and have now been homeless half a year since losing our third and last home in the past 25 years, resulting in severe health issues as a direct result.
Anyone who thinks those who worked hard to afford and provide for whatever minimal (these days) protection owning a home can provide them (which is really a liability with upkeep and insurance costs, not forgetting confiscatory "property taxes" much less bad, destructive, thieving tenants, and is only an "asset" on accountant's ledgers in a worst-case scenario of being forced to liquidate all belongings to pay creditors, or the criminally greedy state and federal courts) isn't thinking this thing through clearly, logically or with sufficient insight into the far more serious problems facing our world, society, personal well-being and freedoms today.
Thanks for sharing your story. I'm sorry it sounds like such a difficult one. I hope @bacchist addresses these concepts when writing his future post about risk.
It has been difficult, but educational (we're never too old to learn).
For some reason I cannot reply directly to @pharesim's response below, but the supposed "solution" of taking a home simply because it isn't being lived in by the owner currently is just warmed over communist-style socialism, which has never proved workable economically (Russia and China are two major examples of the past century).
Say that a businessman, who worked hard to salt away a few shekels, decides to go on a business trip while paying others to look after his home. Should his return be delayed by unforeseen business difficulties, at which point would he be forced to find a new home and personal property to replace that taken over by squatters during his absence?
One month, one year, or immediately? Sorry, but I don't see the difference between what the anarchists are proposing and state confiscation of homes for unpaid (even unconstitutional) property taxes.
Private mortgages are not the problem, unless their interest rates are in the usurious range, based on voluntary contracts. Banks that claim to make such loans, but which actually only trade the borrowers promissory note (a claim against his future earnings) to investors while putting nothing of their own considerable assets at risk in the transaction -- like modern-day money changers -- but later use this document they no longer hold as a claim against the property or other collateral pledged against default in paying the so-called "loan," are part of the real social problems we should be addressing (fraud in the courts, banking institutions, and corporate businesses that profit from such fraud, as a result).
All this is addressed already imo. There wouldn't be tennants, and nobody would be homeless :) When you have a home, there's no way to get you out. And when you don't have one, you'll find (and probably need to renovate) one. If you want to sell, you either make a good price to find a buyer, or give it up. That's still your decision. Playing the markets while others want to utilize the good is a waste.
All those questions evolve around the idea of private property. You just shouldn't be able to own a house you don't use personally. It's part of the game right now, so no offense given ;-)
But in a free world, houses would belong to those living in them. And you wouldn't pay a mortgage.
Glad to hear no offense given. :)
Does that mean an authority would have to exist to prevent people from doing so or would this just be a culturally reinforced social norm (i.e no violence or coercion needed to enforce it)?
So is everything purchased with cash or are we imagining the abolishment of money as well? If so, I have trouble figuring out a mechanism for determining value within the chaos that is human existence. Scarcity appears to me to require a mechanism for distribution beyond whoever is willing to use violence more than the other guy. Economic freedom through voluntary exchange of value seems to be the best thing we have going so far for increasing human well-being in these situations.
What about those who can not afford to build a home themselves or purchase it directly with cash (or some other equivalent if we're talking about a gift-based economy or some similar setup)? Do they just... go homeless? I get how problematic slumlords can be, but I also think a landlord can provide a valuable service (again, by taking on risk which I believe has value -- I'd love your thoughts on that) to someone who couldn't otherwise afford a long term commitment to a single geography or the risks involved with home ownership.
Maybe I'm completely indoctrinated with capitalist thinking because of my pro-capitalist, Western upbringing... I'm open to that, but I'd still want to see more solutions for improving human well-being if I'm going to throw out private property (and, potentially, money with it).
You miss a huge key element here Luke. No one would pay a mortgage or rent without a government telling them they couldn't just build their own home on any unoccupied peice of land...except maybe in cities but even then some would move out to build free, leaving a huge volume of empty houses, and driving rental value down so low as to not be worth keeping rentals
It isn't the free market (whether it's called capitalism or laissez faire) that's the problem...it's when what should be a limited government serving its constituents interferes through coercion and fraud, to skew the results to the benefit of some special interests and the loss of those not so favored, that should be a focus of attention.
For instance, what are the justifications/ramifications of "the state" taking a share of every transaction in the form of sales tax in the transfer of purely digital "products" over the Internet, the bandwidth or use of which has already been paid for (including tax) by the seller and buyer?
Also the "funds" used for such transactions being usually purely digital as well, what gives "the state" (those claiming to act on behalf of everyone) a right to lay claim to such otherwise private property (including personal time/effort invested) without full and fair compensation for the confiscation?
If no authority existed, you wouldn't be able to keep steady control over (several) houses you don't live in. The social norm would be the definition of self defense, is someone moving into a house you don't personally use threatening you enough to exercise physical force over him? And of course there needs to be an agreement about the difference between abandoning and leaving for a while.
When you plan to move out of your awesome house, and someone else wants to live in there, you can of course ask for an exchange. Money is a good tool for that. And if he doesn't have the cash, you're free to make a deal with him, this involves third parties and mortgages.
No, voluntary exchange is great. But you wouldn't take a mortgage for a house you wouldn't use, because there would be no authority helping you to throw out potential squatters :P
The services a good landlord provides can probably, with minor modifications, be a business of their own.