Its not all mortgages though.
What do you tell the property owner who paid off mortgage, and uses the rent as primary income? Should the govt pay these people? I suppose they could get the banks to loan the money interest free...
What do you tell the property owner who paid off mortgage, and uses the rent as primary income? Should the govt pay these people? I suppose they could get the banks to loan the money interest free...
No they wouldn't, because of rent control. Once they accept a lower rent, they're stuck with it for the long haul. In most cases, rent control makes you significantly better off going without rent for long periods of time than lowering rent.
but really there should be some minimum UBI so that nobody starves or lives on the streets.
wouldn't it be nice if I didn't have to do anything at all for a living but wait for my tenants to pay up?
It's not exactly free money -- landlords do have to deal with the maintenance of the property, fixing/replacing broken appliances, and so forth. Before a landlord goes bankrupt they will cut back on maintenance that is not absolutely essential (something I lived through in my younger years, seeing benches fall apart, trash not being removed, and weeds taking over the front and back yards of the building), and eventually would not be able to pay for maintenance that actually is essential (good luck getting your plumbing fixed when your landlord cannot pay the plumber). There is also the matter of cascading bankruptcies when large numbers of landlords are not being paid, resulting in their loans no longer paying (likely dinging retirement accounts and pension funds).
The fact is that a major shake-up in how we organize housing e.g. getting rid of rent-seeking landlords would be difficult in normal times. Doing such a thing during a deepening economic crisis would make everything worse for everyone, including people not directly involved.
There ain't no such thing as a free lunch. In a market with units for sale and for rent, prices tend to reach an equilibrium. The only difference is that rent includes a premium for the relative ease with which one can move.
Another way of looking at it is that traditionally it was considered reasonable for annual rent to be 1/20th of the purchase price of a property. Likewise, 5% annual maintenance was considered reasonable. Unsurprisingly … 1/20th == 5%.
> Many landlords probably spend more time sending out bills than they do on maintaining the property.
That was certainly not my experience when renting. My most recent apartment had multiple full-time employees maintaining it and had an annual improvements budget. I won't claim that it had all the amenities I would have liked, but the landlord was definitely not just letting the cash roll in.
The classic example is someone who puts a chain across a path and then charges to move the chain out of the way.
WRT landlords, you can still describe some of their behavior as “rent-seeking” if they are perpetuating a social or political environment where they get greater returns for doing nothing (e.g. NIMBY/BANANA)
Rent seeking is collecting “rents” (which is different than rent for a home) from either a public good (like land) or through lobbying for legal changes that prevent competition and increase earnings.
A house built on a piece of land is an improvement and doesn’t fall under “rent seeking”.
You could make the argument that the land the house is on is rent seeking, sure, but that would mean only a part of the income would be considered rent seeking.
So the rent seeking would remain constant. If the home+land is value at $500k, but the land is worth $200k, then 40% of the income could be regarded as "rent seeking".
But who and how much -- that is a very tough decision.
The whole point of money is that it is fungible so it would just go elsewhere. Not a very good outcome. Imperative "shoulds" don't mean a thing in emergent systems and problem solving. Parents should love and nurture their children but we still have child abuse unfortunately.