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Fucking leeches (lemmy.dbzer0.com)
submitted 2 years ago by to c/aboringdystopia@lemmy.world
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[–] 19 points 2 years ago (11 children)

Any reason why we can't just change the tax code to make this thing less viable? We disincentive things all the time. Like we can carve out exemptions for situations and things I'm sure but like, this shouldn't be how to run a society.

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  • [–] [S] 22 points 2 years ago* (last edited 2 years ago)

    Any reason why we can't just change the tax code to make this thing less viable?

    99% of state and federal level politicians are owned by these leeches and/or ARE these leeches.

    In other words, almost all of the people with the power to do anything about it have a vested interest in NOT doing anything about it.

    this shouldn't be how to run a society.

    Ramen.

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  • [–] 4 points 2 years ago (4 children)

    Increase the tax rate to 100% on all profits from renting/leasing residential properties. You can still rent out housing but you can't make a profit on it.

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  • [–] 8 points 2 years ago (3 children)

    Fwiw, while this would be a disincentive, the 'real' money from this is the ability to leverage at a high amount.

    If you mortgage a property you effectively get to leverage your capital 5:1, and your return is made by someone else paying the interest on your margin, any below the line profit is a bonus.

    So if it's costing my business $100 month (mortgage, losses) and the tenant is paying $100 (rent, profits), your net profit is 0 but you are effectively earning $80 on that $100.

    So you would need to also reclassify what it means to be a real estate professional, to prevent business from being able to claim real estate expenses as a loss. (As well as the tons of other aspects like depreciation which give you time value of money over the life of the property, depreciation of assets within the house, and other tax benefits.) in fact it's possible to take a 'loss' on a house and rent it for less than your mortgage, and still come away making money

    Just sayin there is more to it than just black and white P/L

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  • [–] 3 points 2 years ago (2 children)

    Verbage:

    Profit: An advantageous gain or return; benefit.

    I was using the more common definition of the word, not the annoying accountant one.

    Accountant profit: Financial gain from a transaction or from a period of investment or business activity, usually calculated as income in excess of costs or as the final value of an asset in excess of its initial value.

    Of course the laws will have to be written in such a way that removes the ability of leeches to make financial gains on the back of other people.

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  • [–] 3 points 2 years ago (1 child)

    100 in rent - 100 in mortgage cost = 0.

    The gains are by the inherent value of the asset. You would need to tax the sale of the property because that is where the profit is realized.

    My point isn't about a semantic difference in the definition of a word. It's that blanket policy that isn't well thought out doesn't actually solve any problems, it's helpful to take some time to actually think things through, get a better understanding of what is at play and come up with real ideas that can be actioned if you want change.

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  • [–] 3 points 2 years ago* (last edited 2 years ago)

    Any reason why we can’t just change the tax code to make this thing less viable

    Culture. Too many people think those who have more deserve more and those who have less deserve less.

    It's the same idea that made slavery so accepted in the South. Most Southern whites did not own slaves; they could not afford it. They still supported slavery because they supported the idea of owning slaves, that maybe one day they could get a slave of their own.

    Same goes for why we have so many dirt-poor paycheck-to-paycheck useful idiots going to bat for their oppressors; they're hoping that one day they can be the oppressors. Oh, and they don't want to admit they're being taken for a ride.

    Until this culture changes, we shouldn't expect things to get any better.

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  • [–] 3 points 2 years ago (2 children)

    If you took every property that individual people owned and gave every one of them other people, we would still have a housing shortage with insane prices for a home. Shitty as most landlords are, the real problem is massive companies that buy up houses.

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  • [–] 1 point 2 years ago* (1 child)

    The higher the supply the lower the prices; we need higher housing supply. We need to reduce barriers to building homes and increase government investment in building new homes.

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  • [–] 2 points 2 years ago

    Around where I live they're slapping up houses literally as fast as physically possible. The infrastructure of the county can't keep up with the number of new neighborhoods and popping up. Traffic is insane and the schools are beyond busting at the seems. The elementary close to my house isn't even 10yrs old and it has almost as many classrooms in t buildings as it does in the school itself. And house prices are still insane.

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