Democratic, with occasional exception for state & local govt, my county has a notoriously corrupt Democratic machine that needs to be tormented as long it it doesn’t involve sending a Republican to congress or the White House. There are attractive parts to Libertarian theology if you’ve never advanced intellectually past adolescence like some of our pols, but it’s a disaster for the environment and those needing a safety net. I’m not against safety nets, I’m against one small slice of the populace being singled out to provide it. Would you pass a law saying farmers needed to sell their products under market to feed the indigent?
You still haven’t explained how anyone can price gouge in a free market with sufficient supply. It’s the supply problem that Albil mentions in the case of SF. It’s a problem all across suburbia where people oppose allowing dense development like affordable apartments, even though the home prices have shot up so high their children can’t afford a house and there are no apartments due to zoning. There have been cases where the citizenry gets hysterical at even allowing zoning for basement or garage apartments.
Remember when the Shrub wanted to privatize Social Security and give every individual the responsibility of choosing how to invest their own accounts? At least things aren’t THAT bad yet.
There’s not really a meaningful “free market” in residential housing.
First and second residential purchases are generally about access to credit. That access can be more or less fair.
Most working people who did not inherit property or other assets cannot do a cash sale. Most lenders can’t carry a 20 year note without taxpayer help.
There are plenty of small owners, landlords, who are lovely people. That doesn’t change the reality that many working people view institutional and private equity firms as having derived unfair benefits from preferential access to credit and government assistance. Some might say predatory … or criminal instead of unfair.
Small owners have generally survived the recession, e.g., if their equity was in coastal metro areas, did not own condos in the wrong part of the country or found deals on recently foreclosed properties. Lucky for them.
So you and @albill, @anon15383236 — all of us — must certainly be good people. Whether access to credit is regulated in a democratic and fair way is a different (non-moral, non-metaphysical) question.
I had a bankruptcy (as part of my divorce from my first marriage) in 1997. I was only able to purchase my home of 2003 because I was fortunate enough to have a good job (at Microsoft) and because my partner (now wife) also had a good job and she had excellent credit. Both of us are white and had these good jobs, probably, at least partially because we were both college graduates (though not in computers). My grandparents paid for much of my schooling as I grew up poor but lived with them for high school, and her schoolteacher parents paid for hers because…education!
So, yeah, we’re the recipients of privilege here and benefit from inherited opportunities. We had our home near Seattle for three years (sold in mid-2006 as the slump began) and then we moved to the Bay Area in 2006 to be near her elderly parents. We wound up selling at the right time and our home had gained $100K in value in the three years because of the boom of the time. That allowed us, with its sale, to make the down payment on the home we’re still in, nine years later. Without the value gain on the first home, we could never have gotten into a house in the Bay Area (Oakland) when we did. Since that time, we saved money. We were able to get the down payment together two years ago to buy our duplex as a rental but it cleaned us out almost entirely to the point where if things had gone really wrong in the next six months (and they nearly did), we could have lost everything.
Since then, the duplex basically loses money (slightly) but real estate in the Bay Area began rebounding about when we bought so, again, we’ve been lucky enough to join at the bottom of a curve up. Owning the first home for as long as we’ve had it and now the second, has given us phenomenal credit scores.
So, yeah, it is a self-fulfilling cycle of privilege at some point until one or both of us loses our jobs. Since I was almost physically disabled 2 1/2 years ago when I trashed my L5/S1 disc and, in any other profession, I would have lost my job, I actually contemplate all of this quite a bit. My father, a welder, had almost the same exact injury and was on federal disability for almost 30 years as a result. I’m very fortunate that my employer both gives me good medical including rehab, but also lets me work from home if I wish.
Of course, by being open about all of this, I’ll probably be accused of making it about me again. sigh
I’ve been told I “mean well” but I probably have (mild) Aspergers and suffer from being reactionary and poor filtering. I suffer from foot in mouth a lot, even in my 40s now. As Clint said, a man has to know his limitations.
Thank you for the kind thoughts though.
As to my investments, I hope so too. Frankly, I worry though but not about those. My dad’s family were and are all working class folks. He was a welder, his father a mechanic, my aunt and my cousins machinists and carpenters. How does the current housing climate in most large cities provide them a way forward if they do wish to own a home or even, more and more often, rent reasonably? As a landlord, I think about this too as it is quite easy to get carried up with whatever the prevailing rents are for a place.
I abandoned graduate work because I realized that it would (a) drain all of my savings and put me into debt and (b) never provide a living. As @popobawa4u might be interested to hear, I find that this constrains my choices in life. I do well as long as I run full tilt on the corporate treadmill but if I or other folks doing this want to get off, what happens? People wanting to do things that don’t actually generate a lot of income don’t do well in this country and do worse every year. If I wasn’t doing the work I’m doing now and money wasn’t an issue, I’d probably be working with teens and 20-somethings teaching the Humanities in some fashion. I believe in education a lot but our society doesn’t anymore except as a means to a job.
I think we’re still clearly in some sort of Depression or, perhaps, a new term for when a substantial part of the population has no path to doing well. That’s what the root article here was really about, right? A lot of folks here on this BBS (though not all) are a little older or just doing well but my daughter is 19, for example. What opportunities will she have in her 20s or even later? I suspect they won’t be anywhere near as easily pursued as mine were.
I think this thesis is way too globalized for the discussion. If you go that way, the Wall Street interests have their fingers on the scale of every transaction. I’ve even said myself one of the big lies in America is that there’s a free market. But in the market under discussion, "free market’ in housing means competition among the participants, even if those participants need ante to be in the game and some have more institutional advantages. I can’t charge too much, no one would rent. I actually currently have a vacant parking spot because I overreached. Easily rented at $150, hard to rent at $175. That’s a clear market signal. In my recently gentrified area rentals shot up, and now builders are putting up thousands of unit and some people are worried rents will drop. Supply & Demand. Jersey City is not SF, all you need to do to build a high rise is grease the right palms!
Honestly, for us the ante came from wedding cash and a grandmother’s will, but we got insanely lucky with location and timing. It’s not a slam dunk, lots of small owners who thought they couldn’t lose in the early 2000’s crapped out. We bought a property from a guy who inherited it, mortgaged it to the max and bought more, only to have them all underwater and in short sale by 2011. It’s hardly a risk free game.
Watch what you wish for , the issue of access to capital was behind the whole subprime disaster, trying to give loans to people who couldn’t afford them. Some folks should not own. But being a landlord can be surprisingly easy, just buy a 2 family with a low downpayment FHA loan. Can be really cheap if it’s a Handyman Special. Rent one, live in the other while fixing it up, then switch. You can move again in 3 years and get a new FHA loan on another multifamily, and then you’re building your empire. Lots more landlords look like this than like Donald Trump or Darth Vader.
Well said. It feels good to read such a meaningful description of my own concerns. I’m done calling supply side policies the “free market” and ready for some “demand side” policies.
You sound like a thoughtful person, and I appreciate your careful and generous response. You sound like the sort of conscientious property manager that tenants might feel fortunate to find.
I would offer a friendly amendment to our statement of the issue and insert the word “fair” ahead of the words “access to capital” and end the sentence after “subprime disaster.”
I dunno, I see places like both my actual employer and the company they contract me out to do things like oh lets move the job to another state but not the people who have 15+ years experience and just can’t up and move… so we can lay them off and hire fresh kids from college for 1/3 the salary.
I wholeheartedly agree, but folks need to recognize landlords aren’t to blame for high rents, it’s a symptom of the imbalanced economy. Property prices in NYC and London are being driven by offshore interests investing in our relatively safe markets. It ripples through the whole real estate ecosystem. People here in Jersey City have been alarmed by an Australian fund buying up hundreds of rental properties.
Sorry, but giving a loan to someone who can’t possibly pay it back is not doing anyone any favors. The banks were allowed to get away with criminal behavior, but that doesn’t mean everyone is capable of owning a property. Even lots of people who owned their properties outright got suckered by the idea of “free money”, took loans from shysters and lost their homes.
Maybe we need to start from the beginning again, as it were, unless we are made to be complicit in our own downfall. We may have weaker affiliations within groups than heretofore but we do have better communications.
No. Cooperatives and the like. There is nothing in the legal definition of Friendly Society requiring any sort of ritual or ceremonial behaviour only a certain degree of financial probity and regularity.
Sure but that’s where the organizations you are describing came from. Those societies, in the late 19th and early 20th century, were fraternal orders. I used to be an Odd Fellow. Back before the New Deal, they gave sick pay to members, provided for folks, etc. We used to have a legacy chalkboard in the basement that recorded a lot of this stuff.
A lot of them later on turned into insurance companies, which are why there are some out there with some odd names.
The old building in Seattle is one of my old lodges. I used to live three blocks from there. Then a bunch of the guys tried to take over the lodge because, back then, it was a million dollar building and they were trying to milk it for money…and got busted.
A bunch of us left before it became a public scandal, because we couldn’t stop it, and formed Alki Lodge, the first new lodge in decades, eventually merging with the Ballard lodge: http://seattleoddfellows.org/
