this post was submitted on 13 Sep 2024
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The problem is that landlords don't create value, they seek to endlessly profit off of one time labor. Rent-seeking creates no real Value of any substance.
If they don’t create value then they wouldn’t exist in a capitalist market. Their value is that they take the liability of homeownership.
They do create value. They provide maintenance free housing as well as short term housing (short term as in 1-3 years.) Not everyone wants to stay in the same location for 5+ years. If you move around alot It you want to rent is usually the better option.
Now sure you could argue they are over charging for that service but that doesn't mean they aren't providing value.
The only reason why we are having issues is because there is a housing shortage that is raising the price and large companies have taken advantage of this by buying up all the houses at the crazy price and renting them out at crazy rent prices eating up the market for actual people to want to buy a house.
Keep in mind this isn't always the case. Landlords where I used to live are increasingly requiring tenants to pay for some maintenance costs. A past landlord had us pay for anything $300 or less.
Where in the world is that? I have never heard of renters paying for maintenance.
In fact, every single rental agreement I signed over 25 years said "contact the landlord if there is a problem" which was backed up by state law.
Idaho, the South of the North. I now live in Washington, where that kind of shit doesn't fly.
"Free" as it isn't the renters responsibility. If something breaks they call the landlord and say fix it.
Obviously the maintenance cost will be baked into the rent cost, or as an added fee as shown in your example.
No. It's not large companies. It's a sickness inherent in the system and exactly what this is taking about. The only service being provided is leveraging their own credit to get a mortgage from the bank and then paying that mortgage and taxes with rent. They do that because it will decrease supply and increase value. And that's a parasitic practice done not just by large companies by any means. In my city they even subcontract for maintenance and also pay for that out of the rent. If we're doing this shit, why exactly aren't we just letting the renters own their equity for paying the goddamn mortgage. It's a disgusting system.
The ability to rent is useful, but the idea that endlessly profiting off of the same property and doing minor maintenance is creating Value is silly. There's no Value being created through simply owning something. Maintenance creates Value, yes, but that does not make up anywhere close to the profit of landlording.
Value is created by the use of something. If someone is living in a house then it is providing value.
As long as the something is useful it can provide value endlessly.
What is "Value?" We are talking about different things here under the same term. You are referring to "Use-Value" as Value itself. A Use-Value being created has a Value, it will provide it's Use-Value until it is consumed fully.
That's the naivete of the Internet talking. Of course landlords create value; they do so in exactly the same way lenders create value: they absorb risk by amortizing upfront costs and charge a premium to do so.
If you didn't agree that it's an ethical way to participate in the economy, say that. Don't try to pass off a moral judgment as an objective truth.
There's no Value created by risk, that's an ad-hoc justification for profiting endlessly off of labor performed one time long ago.
car and house Insurance both provide value by reducing the capital investment required to continue having an item, landlords reduce the upfront cost of housing by charging a continuous fee instead of a lump sum.
Insurance is perhaps the peak of Financial Capital masquerading as Value.
what about banks?
Same problem, arguably far worse. Consider reading Imperialism, the Highest Stage of Capitalism. Banks play a huge part in the dominance of Financial Capital.
Rent seeking does create value: it provides a place to live. That is tangible value. There is no “one time labor” in this equation. The landlord continually pays taxes, insurance, maintenance, and other regular outgoings regardless of whether he bought the house outright or not.
The tenants literally pay the taxes, insurance and maintenance in their rent payment. When any of these inflates, so does the rent unless there are protections in place.
So being a landlord means someone else pays the mortgage for your unit.
The only thing that could be seen as a service are short term rental, and even then, it was abused to death by the AirBnB/VRBO and any other short term rental service.
Rent seeking is the most capitalistic thing someone can do : you use your money to get someone else to pay your rent. You do the minimal maintenance that you can get away with, and when you actually do real maintenance, your tenants get a rent hike.
If there weren't any landlord, there would still be housing. But a lot more people would own the place they live in, at a reasonable price, instead of housing being used as an investment vehicule.
Your argument is more aligned to capitalism in general rather than something particular to landlording. Your argument is applicable to leased vehicles and other businesses as well. Your argument incorrectly rests on an assumption that landlords simply raise rent high enough to cover all their overheads, but like any other business, landlords are beholden to market rates. If the rent is too high, then you have a smaller pool of potential tenants and it's less likely they will be long-term tenants. Also, if a landlord has mortgaged a house to rent out, it's unlikely that the rent he can collect would come near to covering the sum of the mortgage, the rental-insurance costs, the property taxes, maintenance, and other services. Property taxes alone can be several month's rent. Whenever someone assumes that mortgaged landlords are skating on rental income, I assume that someone doesn't know the true costs of owning a house.
What's really happening for mortgaged landlords is that they are using your rent to build equity in their investment faster than they could otherwise.
The prevalent anti-landlord sentiment seems mostly to stem from bad experiences, rising rental costs, and the notion that landlords are somehow "getting something for nothing". Only the first two points are fair grievances. If you're going to take it further and propose that the owner of an asset (real estate or otherwise) cannot hire their property out, then you are striking at Capitalism itself. If you then nuance your argument by proposing that housing is a special case, and that housing rentals should not be a thing because we all need houses, then you're obliged to consider other businesses as well. One might consider owning a vehicle essential to life; should we do away with car rentals? After all, you're paying Hertz's overheads. Groceries? We all need to eat right?
Houses are not "one time labor.". Housing requires constant scheduled maintenance and upkeep over time.
Not to mention the financing required to pay for it all,which is normally spread over 30 years.
In theory, the value they create is in handling all the home maintenance. Of course, many of them don't do their jobs in practice.
none of them maintain their properties
Maintenance creates Value, yes, but landlords aren't maintenance services, they extract by far the bulk of the profits off of owning the home itself and renting it.