the issue with loosening zoning regulations to encourage property development is that many people treat property as a safe haven asset and don’t care about actually living in it or even renting it out.
Build fast enough that they can’t make 5% real returns by leaving it empty though, and see what happens.
Without monopolized property rights enforcement by city planners preventing the full utilization of public land to organize communities in ways that are actually organic, emergent, and practical; these issues considered to be flaws of capitalism would be largely irrelevant.
Property rights are a social institution. They exist because a group of people/community mutually recognize and enforce it for each other’s benefit. If you have the building of some absentee speculator just sitting there for years unused while people struggle under a highly regulated housing market, that’s immoral. Many libertarians may turn a blind eye to that, but it should be criticized and opposed. And it certainly shouldn’t be considered the result of a free market.
Neighbors in historically decentralized communities have always taken common sense measures to ensure that mindless speculation and hoarding of land wouldn’t waste their local resources and artificially drive up rent and home ownership.
This exists because of monopolized property rights enforcement which, no surprise, exists largely to benefit crony big business at the expense of everyone else.
/in my estimation, this is the furthest left I’ve seen jaehaerys1 go on a libertarian topic/
Although I have to wonder to what extent local and decentralized measures are necessary.
Japan has famously good land use policy, and to my knowledge, no problem with speculators acting as absentee landlords. But Japan even more famously has a falling population.
So I have to wonder at what point these local measures to increase land utilization would have to kick in even if you started reducing land use restrictions.
Part of the problem in this specific case is caused by economic extortion of the Chinese people by the state, and their attempts to evade this.
As long as something fucked up is happening in one part of the world, other parts of the world are going to end up compensating for it in one way or another.
Abandoned homes are only a good investment if there’s a cheap way to prevent squatters from moving in and taking over, otherwise you lose all your money paying your guards.
In this specific instance, that would be “the police will do it for me for free.”
In the grand tradition of crony capitalism, they are wasting a public resource (police time) propping up their private capital.
These are mostly apartments, so it only takes a small number of people occupying the building and the possible presence of a caretaker to make squatters exceedingly unlikely.
What’s the caretaker going to do if he finds squatters?
Because I believe he’ll first threaten to call, and then escalate to calling, the police.
Actually if we take David Friedman’s rule on criminals having to compensate proportionally to the harm they cause (such as in the example of breaking and entering a cabin in the woods to recharge your cell phone to call 911), it would force equilibrium prices really damn quickly.
Someone squatting in someone else’s apartment is undoubtedly a violation of property rights, but the actual compensation for squatting an empty building might be really (surprisingly, so some) low.
If the squatters evacuate promptly once a paying tenant is found it’s definitely not the price of rent, because the building was not generating any revenue and thus the opportunity cost was zero. If they don’t cause any damage to the apartment the depreciation costs are negligible. It seems like it would mostly come down to utility bills, changing the locks twice (once to replace the original picked lock with one controlled by the tenants, once to replace that one with the landlord’s lock others don’t have keys to), rent for however long it takes for the squatters to move out once they’re informed that someone is actually going to live there (which could be just a few days), and whatever wear and tear has occurred.
Thus, if this were ancapistan, well-behaved squatters would be able to obtain housing for really cheap. This would quickly incentivize marginal apartment owners to find someone who pays actual rent, pushing prices down towards 100-friction% occupancy.
I think you guys are overestimating how much the market is actually in equilibrium, the difference of the average cost of providing security in today’s society to occupied and unoccupied apartment buildings, and the marginal cost of finding a clean squatter and ensuring that they are actually like that vs Airbnb which you know are kind of banned everywhere in the developing world.
Yeah, I agree with NN here.
Like, if you get a bad squatter that messes everything up, just how are you going to extract the value from them to fix things? If they had all sorts of money laying around they would not be squatters. If they could easily generate that money when ordered to do so they would probably not be squatters. If you have to throw them into a work camp to get that money, that’s really sketchy tbh and smells of slavery, and also it would probably depend on state subsidy.
“If only we didn’t have a monopoly on the enforcement of property rights” is a blatant overreaction to a situation that would be easily sorted out by just changing the zoning rules, and in London at least, Chinese value-holding housing stock is only a miniscule fraction of total housing stock.