Reason I’m asking is because I have an aunt that owns like maybe 3 - 5 (not sure the exact amount) small townhouses around the city (well, when I say “city” think of like the areas around a city where theres no tall buildings, but only small 2-3 stories single family homes in the neighborhood) and have these houses up for rent, and honestly, my aunt and her husband doesn’t seem like a terrible people. They still work a normal job, and have to pay taxes like everyone else have to. They still have their own debts to pay. I’m not sure exactly how, but my parents say they did a combination of saving up money and taking loans from banks to be able to buy these properties, fix them, then put them up for rent. They don’t overcharge, and usually charge slightly below the market to retain tenants, and fix things (or hire people to fix things) when their tenants request them.
I mean, they are just trying to survive in this capitalistic world. They wanna save up for retirement, and fund their kids to college, and leave something for their kids, so they have less of stress in life. I don’t see them as bad people. I mean, its not like they own multiple apartment buildings, or doing excessive wealth hoarding.
Do leftists mean people like my aunt too? Or are they an exception to the “landlords are bad” sentinment?
“Land contract”.
A land contract starts out similar to a rental agreement. You make fixed monthly payments. If you stay in the home for 3 years, it automatically converts to a private mortgage, and the first three years of “rent” becomes your down payment. If you leave before a year, you forfeit your “security deposit”, just like renting. If you leave before 3 years, you gain no equity; again, just like renting.
If you ever do decide to settle down in one spot, you’re already well on your way to ownership.
I would solve the rental problem by creating a massive, punitively high tax rate on all residential properties, and issuing an equivalent tax exemption to owner-occupants. A land contract is recorded with the county, much like a deed or a lien, and the buyer/tenant would be considered the “owner” for tax purposes.
Is this actually a thing or are you saying it should be?
Land contracts are an actual “thing”. They are legal agreements, recorded in the county register like a deed or a lien. You can buy or sell a home through a land contract right now, if you want. Currently, they aren’t particularly common, but they aren’t unknown either.
I mentioned how I would like to eliminate rent entirely, by establishing exorbitant tax penalties for people who own multiple residential properties. Land Contracts are how I would meet the needs of people who need the flexibility of a rental arrangement, rather than just buying with a private mortgage.
There is an interesting method of “rent” in use in South Korea that is far less parasitical. I don’t know of it being used in the US, but we could adopt it if we wanted. "Jeonse or “Key Money” is where the tenant makes zero monthly payments. Instead, they put down a large deposit. The landlord invests their deposit (there are limitations on what they can invest in), and keeps any interest. At the end of the rental period (usually 2 years) the landlord returns the entire deposit to the tenant. The tenant is protected by taking out a lien against the property. If the landlord cannot or will not return the deposit, the tenant takes ownership of the property.
The Jeonse deposit is typically 50% to 80% of the purchase price of the house, but it can be externally financed if necessary.