so my understanding is that home prices go up because homes are investments that can earn money, and one reason homes are investments is that you can rent them out. how much does landlording contribute to rising home costs, and how much of that contribution is from smaller landlords as opposed to banks and wall street? is "small landlords drive up home costs" a defensible argument i can make?
A landlord renting out a back yard cottage isn't driving up housing costs relative to their homeowning neighbor that has fewer people on the same plot of land. They're still a leech looking to make money from monopoly land rights, but as an individual they didn't make rent go up nor did they do so collectively.
Where they do drive up rent is in pure investment properties re: land use. Even a simple argument holds this: after putting in the capital to build the housing, all the landlord does is extract money from ownership. But unlike a capitalist, where this drives the production of goods and services, the landlord seeks rent using natural monopolies: they provide nothing that a centralized authority couldn't do better and without rent-seeking. The landlord's cut is pure overhead on housing costs.
Because of the land use monopolization aspect, landlords also fight against other forms of housing. They fight against public housing and they fight against programs to house the homeless anywhere near themselves. They entrench the existing forms of land use, themselves beneficial to existing property owners and detrimental for anyone trying to buy housing for themselves - or to rent. Want to build medium density public housing in a single family home neighborhood? Sorry kiddo, that would require zoning changes and every property owner in the area (with 25-50% of the housing owned by landlords) raise a fuss.
The real elephants in the room are artificial scarcity of housing and the financialization of housing, though, which are highly interrelated and not really small landlords' fault.
I think organizing around local housing like this is a great idea. I think it can win some victories, particularly when pushed by a socialist party. I do think it will be fundamentally limited, as another part of the real estate scam is that once you get some, you can ride the waves of financialized property value increases and thereby find stability. The removal of this in, say, just one city will result in a state-level backlash to restore property values alongside actually decreased wealth insofar as it's measured (it's measured in favor of the ruling class).
I'll keep looking for more data, but here's a study on how an increase in AirBnB listings leads to a rise in rent and home prices. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3006832
Just the fact that a property could hypothetically be rented out has already been accounted for in our GDP- imputed rent
This possibility means that homes are going to get turned into rentals to realize that imputed rent as actual rent as long as capital is available to do so.
"small" landlords are a rhetorical shield that enables this.
Okay, here's another one. From a paper called "Do Rising Tides Lift All Prices? Income Inequality and Housing Affordability"
From the conclusion:
As expected, the findings in this paper confirm that decreases in one's own income have a negative impact on housing consumption. Presumably, the consumption of most other normal goods declines in such a scenario as well. Of greater interest from both a scientific and policy perspective is the question of whether increases in others' income, holding one's own income constant, influence consumption decisions.
In the end, the evidence on this question is mixed, and it seems relatively clear that the answer depends critically on the elasticity of housing supply. In this sense, the study of demand- side determinants of housing affordability problems should not be conducted in isolation from study of the supply side. In the United States, tight housing markets tend to be those where incomes are rising rapidly at the high end of the distribution, while incomes at the low end trend upward only slowly if at all. In these areas, the poor have experienced greater crowding, and there is at least some evidence that their expenditures on housing increase as well, though not in all specifications.
No it's not because small landlords have no real market power since they own too few buildings. They can (and will) only follow the market price
aren't they driving up prices with their aggregate demand? and they can afford to pay more because they'll have tenants paying for it
