'Atlas Shrugged' author sees resurgence

[UnderseaLcpl]

Originally Posted by onelifecrisis

@UnderseaLcpl

I take your point: the bubble was made by the government interfering in the market in order to meet an objective. The objective was to make housing affordable to Joe Regular. Now, what caused houses to become unaffordable to Joe Regular in the first place? Capitalist economics

We can go round and round like this if you like.

Is housing inherently affordable without capitalism? Is unaffordable housing even a problem? I can't afford a house, so I split a rental house with two others. That seems to be working out okay, at least until I have enough capital to buy one.


I'm curious though, as to what system you would like to see in its' place.

[onelifecrisis]

Originally Posted by UnderseaLcpl

Is housing inherently affordable without capitalism? Is unaffordable housing even a problem? I can't afford a house, so I split a rental house with two others. That seems to be working out okay, at least until I have enough capital to buy one.


I'm curious though, as to what system you would like to see in its' place.

Is housing inherently affordable without capitalism?

Yes, actually, provided that (a) there are enough houses for people to live in and (b) the population is fairly stable. Both of these are true in most (if not all) "western" nations. In fact, as has been pointed out in another thread, many European nations are reliant on immigration to keep the population in a state of equilibrium.

Once a house is built, the only "real" cost (i.e. material cost) associated with it is in it's upkeep.

Is unaffordable housing even a problem? I can't afford a house, so I split a rental house with two others. That seems to be working out okay, at least until I have enough capital to buy one.

If the house price trend had continued it would ultimately have led to a situation where normal people would have no hope of ever affording a house (in fact it was starting to get that way already, at least here in the UK, and may yet end up getting there in spite of this hiccup). There would end up being a dividing line between the haves and the have-nots, with the former gradually accumulating all the properties and the latter funding that accumulation with rent, and the end result being a society split neatly in half. One "half" would be much bigger than the other, of course, and people in the big half (the have-nots) would effectively constitute a sub-class.

Renting might be fine for you now (I assume you're young and single) but would you be happy raising kids in a rented house, when that time comes? Would it be OK having to move your whole family to a new house on the whim/luck of your landlord? Not to mention the various law changes that are always going on with tenancy agreements (which could also result in you having to move unexpectedly) and the fact that you'd be piss-poor and have no chance of leaving your kids any inheritance.

When it comes to "settling down" most people want a place that's theirs so that they can tell themselves that, no matter what happens, that roof will stay over their heads. Of course there are no absolute guarantees in life, but that doesn't stop people wanting to get as close as they can to an absolute guarantee... and rent just isn't close enough for most, IMO.

I'm curious though, as to what system you would like to see in its' place.

I'm not anti-capitalist, I'm just not ultra-capitalist.

[UnderseaLcpl]

Interesting points, OLC, but I'm having trouble seeing things from your perspective.
The flaws you mention in the housing market (spiraling prices, polarization of ownership along class lines, unstable tenancy agreements for renters) are not things I have seen in the U.S. Perhaps it is so in the U.K., but the U.S. has actually experienced plummeting hosuing prices due to oversupply. I don't generally see evidence of a tendency towards a class split in free housing markets, either. We have a large middle class that generally has pretty decent housing. By contrast, the absolute worst housing we have exsists in places where the government regulates or provides housing. Public housing, rent-controls, housing initiatives, invariably all slums.

I'm not sure renting is the minefield you describe, either. I don't move anywhere on the whims of a landlord, she's bound by the same contract I am, and has to pay me a fee if she terminates it early, just like I do. I also want to own a house, but even that isn't much different from renting. I still have to pay rent to the government in the form of property tax. They actually can evict me pretty much whenever they want, and if I miss rent it is a felony.
Renting and not having a family lets me save money so I can afford a house and a family someday. I find that preferable to relying on taxpayers
to subsidize my ambitions, unlike some people in this country.

I just go on and on don't I? Last thing, I promise. I'm still not sure I understand your views correctly, so I will pose my last question again. What system would you prefer if not the free market? Even I am aware of the need for some regulation, perhaps you have some good ideas for appropriate regulation?

[onelifecrisis]

Good ideas? No, not really!

[Freiwillige]

So in a nutshell, the housing market failed because the government thru regulation forced the banks to give home loans to people who could not afford them? They the people defaulted on there loans and the market collapsed?

Did this start under Clinton's administration?