Especially when those 2nd, 3rd, + properties are being used as passive short term rentals. Observing the state of the housing situation “Hmm there aren’t enough homes for normal families to each have a chance, I should turn this extra property of mine into a vacation rental.” does this make said person a POS?
The problem isn’t people owning an extra house for a nest egg. It’s companies owning hundreds of them.
If housing is an investment (“a nest egg”) then the people and policies that support it as an investment will stand directly opposed to people and policies that want housing to be affordable and a right.
Housing cannot be an investment vehicle akin to stocks in a society that meaningfully values housing for everyone as an objective to strive for.
Real estate as an investment, retirement provision or object of speculation is precisely the problem. Every home that gets bought as an investment in an inflated housing market directly contributes to the problem, by cutting people out of the opportunity of ownership and making them dependent on paying rent.
I’m far less concerned about individuals buying an extra house they can rent out. I’m more concerned with hedge funds buying up cities with cash offers that normal people can’t compete with.
I personally wouldn’t own multiple homes for many reasons, but for people trying to eject out of the corporate grind, I get it.
I like what Mike Lynch (famous leader of one of UKs biggest union) said during his Novara media interview… I’ll paraphrase from memory. “Back in the day, your retirement was secured with your job. You’d get a pension from your employer when you get to retirement age. Then Thatcher and Reagan happen… Now days, there’s no security, benefits or high salaries anymore. So people do whatever they need to do to secure their retirement. And if it’s buying another property, so be it.”
Quick edit: before anyone gets angry. Neither myself or him want this to continue. It’s shit and we should fight to bring back dignity to people’s careers. But until that’s sorted, I think it’s ethical to care for your own and your family’s survival.
Thanks for this. I’ve been having an internal debate myself over the ethical implications given the state of so many struggling with housing. I’m maybe 5 years out from paying off my home and have considered buying another home at that point for income as I get older. When I say income, the only reason I’m considering buying a house are exactly the reasons you listed; career instability, retirement income instability, but also medical care costs that are impossible to project in the future other than “astronomical”.
When I’m thinking of a second home income it’s so I can pay for a future hospital visit for me or my partner, not lie on a beach in the tropics. It’s maybe something for my child so they don’t have to start from zero or experience housing insecurity. It’s a relatively very privileged position compared to many in the US, but I’m not looking to gouge some poor renter, just be able to have basics in old age. Basics, however, now require relatively large amount of privilege thanks to conservatives stripping them away for 50 years.
I’m still undecided, but I appreciate the nuanced take.
Are you denying another family a house they would’ve otherwise been able to buy? Then yes.
Not necessarily. We were a young family that had to move quite a bit for my job. We made due with apartments, but we preferred renting a house. We were in no position to buy, and we knew we were only in the area short term, so we appreciated house rentals.
Honest people with a second or third home for rent aren’t doing any harm.
How do you answer that question honestly though? Say I’ve got enough liquid cash/ income to buy a second home, if I decide to just sit on this money or throw it in the stock market, does it magically make the family of four able to afford it? No, the house remains the same price, the family has the same amount of money, and the seller moves to the next buyer and sells it to them instead of me.
If anything I’d rather my landlord be someone who owns 2 or 3 homes and rents them than a huge real estate company
In healthy system they should be able to afford to build it.
We have a second house (a trailer, really) and rent it to my mom for way under market rate. 100% of the rent goes to paying off the debt from rehabilitating the trailer and paying off her utilities. It’s not like we’re out here just raking in the dough, we’re just trying to keep my mom from being homeless. I know for damn sure we’ve got to do it, because the state is way happier spending its money bashing homeless people instead of preventing homeless people.
I own a 2nd property but bought it for my son to live in. I figured that if I was going to be providing that much financial assistance that I’d rather buy a condo than pay rent.
There’s a lot to unpack here. My two cents are:
- progressively higher property taxes for every additional one (probably with an upper limit)
- restrictions and heavy taxes on short term rentals
- any house that’s not a permanent short term rental (with associated taxation) and has not been the object of a long term rental for some reasonable amount of time, gets forcibly put on the rental market at a government fixed rate
- heavy fines for and seizure of properties intentionally left unoccupied to artificially inflate rents
progressively higher property taxes for every additional one (probably with an upper limit)
I agree in principle but I think we should clarify whether that additional house is intended for short term rental, lomg term rental, or an additional “vacation” house. I think all 3 should have different taxation schemes.
I’d imagine those would be separate taxes. One is a property tax because you own that property, and then if you earn money from it via short or long term rentals you pay taxes on that.
I mean someone who owns 4 houses just so he can visit them throughout the year should be paying a higher rate of property tax than someone who owns 4 houses but rents out 3 of them to long term tenants. Probably more in property tax than the landlord pays in property + rental income tax.
I see what you mean, that makes sense.
You could probably sell it as an incentive thing. Rent your property, pay less property tax on it.
But I’d say the tax on rent should still be there, and be proportional to it. Since the property tax would also be dependent on the value of the property, what you say could still be true.
The math I came up with to make multiple property ownership moral is that every homeowner should be charged a separate federal tax that is equal to their (city, state, county) property tax times the number of properties they own minus one.
So for instance, if you are currently paying $5,000 a year in property taxes and you buy a second equally taxed home. Right now you would pay 5000 extra dollars for that second home.
Under my scheme, you would pay $10,000 a year for that second home., or $15,000/year, $5,000 of which goes to the federal government as part of an anti-homelessness fund.
And if you got a third one at the same price, you would now pay $15,000 for each of the two extra homes, and now $10,000 for the first one, or $45,000/year, $30,000 of which would go to the anti-homelessness fund.
This would make it so that owning multiple homes would be something only the very wealthy or the very spendthrift could pull off, and it would disincentivize companies whose sole purpose is to profit off of making Americans homeless.
I think such questions are hard to answer in general. I would say a person living in one (small to normal sized) flat and owning + renting another isn’t worse than one person ‘occupying’ just one but bigger livingspace. If an old lady lives alone in a big house where there are sufficient rooms for 6 people+ she’s taking away as much property from the market as the small-scale landlord. Sure that’s not optimal for society but I also wouldn’t necessarily consider that unethical.
If there is a housing crisis in an area, one can argue that short time rentals are evil but also short term rentals are important to some extent. If everything becomes an AirBnb that’s obviously bad but I think there’s also a healthy amount of that. If a city or region has a lot of tourists or business travellers, they need to live somewhere and traditional hotels don’t work for everyone.
From my perspective, there must be a healthy balance of personal livingspaces to buy, for long term rent, for short term rent and commercial buildings. Regulating that healthy ratio should be a task for politicians. Unfortunately, I have to admit that government regulation is not exactly working fine in most parts of the world.
With our european housing market, that old lady or man might not even be able to move to a smaller size, even if they wanted to. Or, they might have a ton of kids and grand kids sleep overs, or kids that need to move back (happens a lot in our country) because they cannot find a place to live, so i generally try to be careful not to assume things when i don’t know details. It’s something that is basically the fault of our politicians, who could see this problem coming decades ago, but decided not to act. It’s not always the fault of people that are stuck in a house that became too big and can’t move because there just is no smaller appartment available, but the people who voted for politicians who let buildings be bought up by greedy investors. Edit to clarify my agreeing with your points
We have this nightmare in the UK. I’m very fortunate to have a small house just about paying mortgage on a tiny wage, but not really big enough to rent a room. I feel bad for people in their 40s (even couples) who can’t afford a starter home because all the properties are locked up in a rental market.
Damn. Moral systems gonna depend on the economy too?
It really is the new deity!
I think owning anything more than your primary home as a residential unit is unethical.
I don’t consider it unethical. For example if my father dies and I inherit his house where I grew up, he grew up, his father grew up and his grandfather built. That house has a lot of sentimental value in it. I have settled down very far from there. What am I supposed to do? Throw away the family legacy or uproot my entire life?
I think as long as I don’t rent it out it’s acceptable to own it. It’s just extra cost for me to keep something of sentimental value in the family. I’d even be okay with paying extra tax on it considering I think every house you own that you don’t live in should be taxed extra.
Ah yes, your family legacy of a house no one lives in is more important than a human beings ability to have shelter
Perfect is the enemy of good. You’re not at home while you’re working and if you do full time then a third of the day you’re not using your home, why don’t you let others use your home while you’re not using it? You’re also putting your individual needs above giving someone else shelter, the only difference is where you’ve drawn the line.
You’re gross
Right, so tell me what is the course of action?
Don’t own more than one house. Why is that so hard for you people to understand
This is why nobody listens to people like you. Someone has a legitimate grievance trying to do what you want them to do and what is your response? Completely ignore the grievance and go “I can’t believe how fucking stupid you are, just do the thing.” Really helpful.
I would say owning it while not using it very much and not renting it out is the least ethical choice as no one can use that house.
The most ethical option besides not owning it is renting it out at a reasonable price, so someone else can live there and you are not squeezing every last dollar out of them.
I guess I should’ve specified. I don’t think it’s rent-able. It’s more than a 100 year old house in the middle of nowhere with more than 100 year old plumbing (hint, no plumbing), no internet outside of mobile network which is also very flaky since there aren’t many cell towers nearby, water comes from a nearby well which limits the amount of water you can use because it’s not a deep well and the list goes on. It’s not a modern house that’s going to just sit empty, it’s a relic from a different era where the main value the house has is of sentimental value. If it was to get sold the next “owner” would most likely tear down the house and turn the entire plot of land into agricultural land.
If it was a decent apartment somewhere where people would actually want to live I’d absolutely “rent” it out. Not take any profits from it, put a bit to the side in case something breaks and if they leave without breaking anything they get their money back.
Ok, thats a bit different, if the house is somewhere where noone wants to live anyway (and if they want there are enough options available), then it really is ok morally, at least for me.
One could argue that the space should be used for farming, but that depends on how big the property even is if that makes a difference at all.
If it has a really big property with lots of grass it would be a good thing to rent that part out to a farmer. If it is more of a forest its probably better if it stays that way.
I wouldn’t mind that also. I think a decently sized land value tax is the way to go so that land area isn’t just used as parking because the person still makes a ton with increase in land value.
A lot places are making zoning laws against short term rentals, or making the permits prohibitively expensive. Where I live, there is an often repeated narrative about a “housing shortage” but the reality is the population is going down every year and apartment complexes and housing developments are spreading like rashes. Corporations are buying them up in order to control the market.
A family renting out their mom’s house that they inherited after she died because they already bought a house and don’t want to live in hers? Are they assholes for not just selling the place (likely to a corp) and investing that money in other ways? No… I don’t think so…?
I believe business should be limited in ownership of single family homes for sure.
Where? In areas with tight housing markets, maybe. In places with houses in abundance, I don’t think so.
I have a second home but I inherited it. It would need 100s of ks in renos to rent out. It wouldn’t bring me much money to sell it - would probably need to sell for land value only.
But - it’s a place of refuge for my family member in an emotionally abusive relationship, a friend struggling with her marriage, a crash space if anyone I love is in a rough spot. It’s brought my family together and it’s where we gather.
I don’t think this is wrong because I am using it for net positive purposes in the long term, and someone otherwise probably couldn’t use it - it would be a tear-down.
If it’s legally habitable, someone could be living there imo. Just price the rent adequately low for the value. I’m not saying it’s morally evil for you to have it, but it’s definitely a luxury.
It is likely not legally habitable. And to make it so for a renter would be beyond my current financial capabilities.
Ah, in that case I think you’re looking at it the right way.
I don’t think so. People need homes, but not all people can buy homes. If you can afford to maintain the property to a reasonable level without completely gouging your tenants, I think you’re providing a valuable service to your fellow citizens.
We don’t get along, but my landlord is an old lady who bought 2-3 blocks of apartments after her husband left her a bunch of oil money. She keeps up the grounds (for the most part) and my rent has been pegged to inflation since I moved in. If people like her didn’t exist, people like me would be stuck renting from a big property company.
