General Discussion
In reply to the discussion: Why not outlaw landlordism? [View all]FreeJoe
(1,039 posts)At first, your plan might work. The problem would be that people would be much less willing to build homes. Today, if I build a house, I can live in it, sell it, or rent it. Under your plan, that last option is off the table and, as you suggest, the sale price might be much lower as well. That significantly reduces my incentive to invest in a house. Even more importantly, it destroys my willingness to build an apartment complex. The result would be fewer and fewer houses being built. Just like cities that have rent control, shortages would appear and the home prices would stabilize at a level many would find unaffordable.
Another possibility is that an entirely new sales model would appear similar to auto-leasing. Instead of renting you an apartment, I'll sell it to you with financing designed in such a way that you are effectively renting it even though you legally own it. It would be something similar to leasing a car. I'm going to sell you the house but the conditions on the loan I give you are going to make you treat it like a renter.
Another problem with your idea is mobility. There was a period in my life when I moved a couple of times a year. Renting was great because the transaction costs for the moves were low. If I had to go through the expense of a property sale (typically 3-8% of the cost of the property), moving would have been cost prohibitive. That would have significantly stunted my career.
Honestly, I rarely ever had problems with landlords. When I did, I moved.