Basic solution to the housing crisis

[integral]

The problem is rich people are storing all their wealth in housing accumulating more and more and more and more and more. This creates a huge problem of supply and demand, for the supply drops like crazy and the demand keeps going up and you get exaggerated insane housing prices.

Where in the next 10 years the average condo will cost 3 to 4 million, and no one will be able to buy a house.

 

The solution:

1} Limit people from buying housing, making it so a person is only allowed to buy one house.

2) Prevent foreign investors from buying property in the country unless they have a citizenship.

 

Now the entire housing market will self regulate, because rich people cannot store their wealth in housing.

Housing prices will drop back to normal.

[Sempiternity]

Great idea! How are You going to implement this? Because our government sure isn't going to, ever.

[aurum]

This is never happening in America. And especially not under the current administration.

[Leo Gura]

1 hour ago, integral said:

making it so a person is only allowed to buy one house.

A few rich people just had a stroke reading that.

[Twentyfirst]

I think property tax already limits rich people from buying more homes than they actually want. If they are investments and the tenants are paying the mortgage then they don't have to worry about the property tax. If they are just hoarding houses just for the hell of it they would be penalized by property tax

If you limit only one house per person then that will limit people's desire to create wealth. Having multiple homes is a huge dream for people and a reason they slave for money. What else will they buy? It's just homes, cars, yachts, jets, jewelry, and clothes

If a rich person wants to buy 5 homes but can only buy 1 what is to stop them from making it a 1,000 room mansion that takes acres of land and then other people won't be able to buy that land

Edited yesterday at 06:09 AM by Twentyfirst

[IronFoot]

This is an interesting thought. However, it would effectively dismantle the entire rental market as landlords would not exist in the same capacity they do now.

 

A few thoughts:

 

1. limited rental options due to only being allowed to own one home could be very inconvenient for people who don’t have good credit or can’t get a mortgage.

 

2. It would be inconvenient to have to buy a home every time you wanted to move cities. You could always 10-31 your home when you move, but that’s a lot of work if you were planning to move somewhere for only a brief period of time. This also doesn’t account for where you will be living in between closing on the sale of your primary residence and closing on the purchase of your new one.

 

3. This would be inconvenient for people who have to move between cities for work. I know a guy that owns a home in DC and PA. He lives in DC for work during the week and travels up to PA on the weekends to be with his family.

 

4. Rental properties are a great wealth building asset. Not being able to have several could hinder a lot of normal people from building wealth (not just the corporations).

 

5. if a relative owned a property and died, would the sale of the house just be forced if the immediate family already owned their own homes?
 

One of the major reasons housing prices are so unaffordable is because not enough new homes are being built. In order to keep up with demand, the US would need to construct 1.7 million homes each year. In 2024 only 1.36 million were constructed (approximately). Year over year the US has been in a deficit in the hundreds of thousands for the amount of homes needed to keep up with demand for a long time.

 

If we need to construct an extra 400,000 homes per year, why don’t developers just build them you might ask.  The cost of materials have went up significantly (especially lumber). The higher cost of materials causes the developers to raise their prices. New builds that could have been bought in my city in 2019 for 300k are now being sold for 600k or more. This has out priced a lot of buyers. The builders know this and don’t want to spend money constructing houses they won’t be able to sell.  Because of this, developers will wait to build the houses until they have found a purchaser (this allows them to offer even more customization options that will cost you an arm and a leg).

 

I liked your idea about not allowing foreign investors to purchase large amounts of real estate. I’ve had this same thought.

 

Instead of putting limits on how many homes a person can own, I would propose putting a limit on how much wealth can be stored in real estate. This number could be reassessed if the values of property in a state were to change significantly.  Maybe the system would be no individual or corporation can hold more than a billion dollars in real estate in each state they operate in. If they pass that threshold maybe implement some sort of rent control on their holdings in order keep affordable options for people on the rental side.

 

in order for this to work there would also need to be a system in place to make sure no one tried to circumvent the limit by having multiple corporations holding real estate.  
 

(also the 1 billion dollar threshold is a number I pulled out of thin air. More thought would need to go into that limit than I just put in. I’m just throwing out ideas)

Edited yesterday at 06:12 AM by IronFoot

[Basman]

You need to balance regulating the home market while not disincentivizing big companies from investing in an building homes too much. Big companies can house thousands affordably if regulated right with none of responsibilities that owning a home comes with for renters. 

[Basman]

Big money doesn't need to be exorcised, just tamed. They provide a lot of value to society. Rent-seeking behavior just need to kept in check.

[Lyubov]

We have plenty of solutions that feasibly would work. It’s not the problem. The problem is corruption, selfishness and lack of oneness awareness .