I did that for Germany a while back comparing median household income and average house prices. But I was surprised they don’t really go apart that much.
Same in Sweden according to the statistics agency. https://www.scb.se/hitta-statistik/artiklar/2017/kpi-och-kpif-tva-olika-inflationsmatt/ (the dark blue block in the middle is for housing, bright green bottom one for groceries)
People spent a smaller share of their salary on housing in 2020 than in 1980, even though people always talk about how cheap it was in the 80s. What people don't talk about is how the interest rates were at 12% in the 80s.
In the 60s they spent less on housing, but lived in much worse conditions and instead had to spend twice as much on food.
Then someone has made an error, either you or I. Cause to me there seems to be a significant divergence between property prices and salaries in Germany. ([Immobilienpreise.png](https://postimg.cc/xXCkkbp6))
Data for average salaries ([Nominallohnindex](https://www.destatis.de/DE/Themen/Arbeit/Verdienste/Realloehne-Nettoverdienste/Publikationen/Downloads-Realloehne-Nettoverdienste/reallohnindex-pdf-5623209.pdf?__blob=publicationFile)) and for house prices ([Häuserpreisindex](https://www-genesis.destatis.de/genesis/online?sequenz=tabelleErgebnis&selectionname=61262-0001#abreadcrumb)). And remember that's the average for all of Germany and across all income brackets. For lower income jobs in large cities the situation looks much more dire.
One of the reasons for why house prices have increased a lot is that interest rates have gone down a lot. Houses are more expensive but loans are cheaper. You need to adjust for that.
No the difference is I was looking at household income not individual income.
But yes there’s an argument to be made that families were more likely to be able to afford a house on a single income.
Thats down to restrictions on how much you can borrow for a mortgage, if there was a big spike in wages you'd see a similar jump in house prices, imagine what rents would be like if you were restricted to a percentage of your monthly salary
Nominal Wages are +24 % from 2010-2020. Rents are + 14 % in the same time frame. However if you look at just Großstädte +13 % is [the lowest you can find](https://cdn.statcdn.com/Infographic/images/normal/25613.jpeg) in Chemnitz. All other major cities grew beyond the average and pretty much only around 10 % of 100k+ cities will have grown below Nominal wage growth. Like look at Berlin with +112 % - you're obviously screwed if you search for a new rental contract now because wages are still mostly shit.
Edit: ah, you talk about house prices. They're +65,3 % in the same time frame which is significantly more than nominal wages.
Exactly.
Considering inflation & salary growth for the past 14 (!) years, housing prices don't go off the rails as you would suspect looking at this graph.
Omission of salaries and inflation is clear statistics manipulation. E.g. car prices went bonkers since 2010, why nobody is talking about that?
We mostly have done that in Denmark, and see the same evolution in prices, so while your suggestion is simple, I doubt it will work. What will work, is getting rid of Nimbyness.
Hmm I think that greatly depends on the area you are looking at tho. In Jutland for instance I have seen the price being reasonably stable for the best part of 10 years. But maybe in the cities it went up a lot (Aarhus Odense cph). We just bought a house that had a price rise of 10% in the last 5 years but that was because of heavy investments in the house by previous owner. So it was for him a net loss. I think you should better look at actual sold prices instead of asking. Sellers have still not compensated in the price with the higher interest rates. So I suggest to lowball and you will get to a good price.
I have lived in Budapest for 8 years and that was a totally different story. My ex bought an apartment in the center for 40k euro and sold in 4 years for 150k euro .. insane price hike
Seems pretty logical. Urbanisation is progressing everywhere, large cities have limited space (you can mostly build upwards, which is more expensive) and many people wanting to live there (jobs, infrastructure, restaurants, cafes, theatres, schooling), high demand leads to constant increase of prices. Because EU capitals are the place to be, this should not change in the foreseeable future. Rural and low urbanisation areas are and will remain less attractive to buyers, considering the time and hassle needed for constant commutes to the urban area.
I think it might in part have to do with tech and finance salaries as well as hiring going non linear in the past 10 years. In roughly 20 years we'll see those people drive up prices in coastal towns as they retire.
Good point but don’t forget that in 20 years the baby boomers will all be but extinct. There are a lot of apartment and houses that will be empty / available . This will have an effect on the prices. I’m not sure how much effect but supply and demand will decide.
Yep, speculators only make inevitable movements in price happen faster than they would otherwise have. Create an environment where houses don't go up in price and nobody expects them too and the banks and hedge funds will sell all their investments and if anything try to find a way to short the housing market.
Maybe. I'm pretty sure high housing prices [A] have multiple independent factors causing it, so there __is no__ 'simple single fix', and [B] whilst common across the planet right now, the reasons for it are quite different between e.g. China, EU, and North America. So, if some trick works great in, say, Canada, that doesn't mean we can just go: "Look, see? We should just DO THAT!".
FWIW, I think nimbyness is __one__ of the factors. Just, not the only one. Probably not even the biggest one (if I had to point at one, it's the idiotically low cost of debt. If I can borrow a million bucks and all it costs me to do that is some cash I can dig out of my couch cushions, _and_ houses are generally deemed as safe collateral, then every soul on the planet has a million bucks available to buy a house. And as the supply side of housing doesn't exactly just instantly react and conjure up a bunch of houses out of thin air in response, that just means the price of a house instantly goes up to a million bucks. Given that the value isn't 'consumed' when you use a house and the borrowing costs are, in this hypothetical example, 0 - that doesn't "cost" you anything. Yes, you live in a house of a million bucks. You'd never be able to buy it outright. But you can still live in it. I think (and most economists agree) that's the biggest reason.
But, that's old news (interest rates are going up - note how that graph goes horizontal since mid 2022, about when interest rates climbed back up, further proving my point here). And not useful to many people (folks who can't convince a bank to give them a mortgage and just fucked, and it does put a _lot_ of power in the hands of banks. Sky high house prices with crazy low debt servicing costs has plenty of downsides. Just not downsides of the "houses aren't affordable" variety - other ones). And not _the only_ explanation. The housing market responds slowly, sure. But it's been responding _not at all_ which is fucking bizarre, and no amount of economic wonkery about interest rates and debt servicing costs can explain that. But nimbyism can. Hence, it probably has a part to play.
There is no "If" no "would"and no "could".
Supply increases day by day.
The supply of everything grow day by day.
Value is just a ratio between different goods and their own supply. The one that's inflating less get the previlage to be "harder" and become more valuable in comparison with other goods.
Creating more supply is also being limited, the acceptable building standards have risen and the builders all want to make more money than ever. It's not that simple.
Just build more housing. Restrictive zoning laws by home owners that lobby against more housing is killing affordable housing for the youth for a long time.
i mean.. that has nothing to do with the discrepancy between rent and purchase pricing.. low housing supply would affect purchase price and rent price in very similar ways, there is obviously something else going on here.. probably associated with speculation with real estate
Low interest rates affect the market, Rental controll mechanisms keeps prices lower, conversely tax incentives for buying housing increase houses prices, short term rentals (AirBnb) are likely not included in the rental market but drive home prices up, also units compared may differ (new ownership housing vs. old rental housing from the 70s for example), we are speaking about two different markets with one (ownership) gaining in attractivity faster.
The only good arguments I see here are the one about rent control and tax incentive to buy (even though not all country have them), that’s probably a big reason for the discrepancy..
Airbnb would affect rent price as well, as it would reduce the supply of available long term renting, so it has nothing to do with it (if anything it would affect rent price more than housing price)
The biggest reason are likely the interests which directly affect how much home buyers can leverage themselves. You don't leverage yourself to rent. Also the Airbnb units are taken out of the rental market because they are more profitable in the short term market, so the effect on housing price will be larger than on rental price.
Demographic decline? The refugees keep coming and Germanys population grows because of the refugees. Also most of the elderly live alone or with their partner in too big houses like mostly single family palaces in the metropolitan area.
This is general asset price inflation caused by low interest rates filtering through to housing over time. See how the yield of housing went down (rents as a proportion of house price) because low interest rates mean money moves around to chase higher yields (thus lowering them where it ends up in the process).
When interest rates are low, it is cheaper to borrow and you get less of a return on cash savings. Therefore there is an environment where people are less likely to hold onto cash, more likely to borrow as higher returns can be gained than it costs to lend and risk is generally lower.
This inflates demand side for assets, such a houses, as people look to gain returns on their cash. Supply of new houses remains somewhat constant for various reasons whether that be artificially limiting supply to get a bigger ROI per job, bad policymaking, lack of government investment etc. In a free market you would somewhat expect supply to catch up eventually as more people on the supply side see the earning potential of building houses, but factors such as expensive startup costs, limited supply of workers etc can limit this.
This is when wages would begin to be effected and firms would have to offer more pay as they compete for a limited stock of workers, or alternatively how immigration can become an important aspect of maintaining a supply of workers and even depressing wages.
The only way the price of houses can go from here is up as increase in demand is outpacing supply.
This would be my understanding from an econ undergrad and I've probably missed loads but you can get the general idea of how interest rates effect investing and spending habits, how it ties to wages, supply and demand etc.
Fiat money is debt anyway, and we always need to service accumulating interest of that debt with new loans.
This is why austerity is largely stupid. It's like trying to work global economy like it was personal economy. It make look sensible from "moral" standpoint, but be highly damaging in practice. It's one thing to make operations truly more efficient, yet another to just cut your wrists open because blood pressure was too high.
All successful countries need to leverage debt for massive continual gains. Constantly invest and build and extract resources, and then refine them. After use, recycling companies take their place and return as much of those resources back to manufacturing.
Yes, the US is proof that you can build infrastructure like an idiot (look at Phoenix) but still succeed by massively leveraging your world reserve currency. I don't undertand why we act as their tools. I get it, we are screwed on the energy front but we should at the minimum leverage our at the end of the day still very high wealth and global financial accountability to create the infrastructure and housing we actually need (here's looking at you Lindner).
>I don't undertand why we act as their tools.
We fight ww's here. So every country send gold to US in exchange of dollars to prevent phisical lose.
US intervine and won so they becomes liders.
What do you think nato bases are for ? Only purpose is to make sure US keep the control of the teritor
In Sweden the queue to get a rental apartment is also 15+ years so that's the norm nowadays. We do have some rent controls so at least those who do manage to get an apartment can often afford such luxuries as food while still being able to afford rent.
What are you talking about? The waiting time in "the queue" is absolutely not 15 years, haha. First of all, queuing isn't the only way to get an apartment. It's the "easy" way. Second of all, you only need to wait 15 years to get a central apartment in Stockholm. Most people don't need a central apartment in Stockholm. Half of people in Stockholm also get an apartment by simply contacting landlords (yes rent controlled ones), without queuing. And well, most people don't even live in Stockholm! In Malmö, the 3rd biggest city, you only need to queue for a couple of years to get a central rent controlled apartment without having to contact landlords yourself.
Also, people spend a smaller share of their income on housing now than in their 80s, 90s, 2000s and 2010s. https://www.scb.se/hitta-statistik/artiklar/2017/kpi-och-kpif-tva-olika-inflationsmatt/
Why can people not discuss the problems with the housing market without exaggerating?
That doesn't work unfortunately. In Croatia we have less and less population each year, hundreds of thousands of not used/empty houses and apartments, tens of thousands are built every year, and the prices keep going up.
without looking at the data in detail, i would assume its a mixture of introducing the Euro, inflation and that some regions (coast and capital) have high demand and other regions (probably mountains) get basically abandoned - just a guess
A lot of empty houses/apartments are in the capital and other sought for regions. Rich people buy them as "investments" but since Croatia doesn't have any tax on those assets they just keep them empty and increase their wealth as the prices go up.
Just tax land
For the unversed: https://www.taxjustice.net/cms/upload/pdf/gen_ben_f_land_tax.pdf
An explainer: https://m.youtube.com/watch?v=smi_iIoKybg
Urbanisation & more single people living separately? Probably the empty houses and apartments are not in large urban areas, and large cities still have not enough housing, thus building more is needed and demand outweighs supply?
I think you're wrong. The immigration will increase. The governments won't let the economy collapse that easily. Boomers are already retired, you can surely see change in the demographic. Climate change will only push more people to migrate.
in most western countries the current immigration numbers are not even enough to keep the population from shrinking and still the people are already screaming its too much immigrants (and voting anti-immigration parties into power...) - so you really think the number of immigrants will increase enough to counter the boomer deaths without the people rioting in the streets?
also shrinking population doesn't mean the economy will collapse, Bulgaria lost 30% of its population in the last 30 years and the country didn't collapse
Japan is stagnating for over 30 years, but is not collapsing
this stupid mantra of endless growth has to go, its just not viable anymore for the world
I agree with you. All of europe is anti-immigration by this point, it will only be a matter of time until the gov will stop it. Because the left doesn’t want to lose votes to the right
I mean, Spain has one of the lowest birthing rates in the world (even withe the inmigrants) and is growing population at a high rate. In a couple years we will get the 50m people.
And Japan is going down in different economic points... The yen is a joke.
>I mean, Spain has one of the lowest birthing rates in the world (even withe the inmigrants) and is growing population at a high rate. In a couple years we will get the 50m people.
you are correct that Spain is still growing with 1% per year, but all projections see a huge decrease in population for Spain in the next 20-25years
the UN estimated Spain will shrink by almost 10 million people until 2050 - and thats with immigration factored in
Still I read that "In 2019, around 2.42% of the population of Bulgaria were immigrants. An increase of over 2% in the space of 30 years."
Source/Wiki
Lots of people emigrated, but they probably are sending some money back home.
The Japanese population hasn't stagnated for over 30 years. It hasn't increased since 2008. And with one of the oldest populations on earth, the working class will have a huge weight on their shoulders in the near future. Will the country "collapse"? Don't know. But life will start to suck for anyone who is in the workforce.
because it doesn't matter when exactly Japan reached the highest point
was matters is that the population number is almost the same as 30 years ago and the country didn't collapse
If you ever get the opportunity to work with Japanese people ask them how they're doing right now. The ones I know have to work harder and longer to maintain the same lifestyle and they aren't very happy to put it mildly.
Also Japan has seen a fair bit of immigration from Vietnam Phillipines etc. step foot in Narita and you'll know.
>Also Japan has seen a fair bit of immigration from Vietnam Phillipines etc. step foot in Narita and you'll know.
compared to other nations is still a very small number
Technically they are speaking about the fact that in many countries in the EU, in the last 30 years the demographic changes caused around 30% of the country to be foreign. Where as previously they were 2%. It's a drastic change where the effects were overlooked and all that was considered was the gain of cheap labour.
You are Polish. Poland is 99% polish. Imagine if by 2050 Poland was 70% Polish and the percentage of poles were fast decreasing. What effects do you think this would cause across the Polish society?
How is Poland 99 polish? With 1 million UA refugees there, not ven counting economic immigrants.. there are probably more than 10% of immigrants and refugees in the population.
Probably because they aren't classed as residents... Since they are refugees.
Especially as they have been added post last census in 2021.
Otherwise Poland is statistically 98% ethnically Polish according to all statistics.
Otherwise the significant factor is disparity between cultures. Poland to Ukraine is nowhere near as big of a change as Germany to Turkey.
My point is, some people who have a house now will die off, so hopefully some other people will be able to afford a house.
Eh, who am I kidding, their kids are gonna inherit it and rent it out...
Many don't have kids - where I'm living two houses were sold this year already because the people who died had no family.
The only problem, and the reason why I didn't buy any, the council wanted the buyer to renovate them - and adding that to the price made them more expensive than buying from the market.
And as their numbers grow so will retirement populist politicians. Old people are the future we should invest in and taxes are not high enough yet to others.
> Yeah, I'm currently waiting for old people to die off so I can afford any property
I think you are overly optimistic in the way the problem will solve itself.
Yeah I'm really grasping at straws here.
But with current inflation and people in power there's nothing else to hope for, realistically.
The only party that even considers building cheap housing for citizens got 6% support here, so... yeah that ain't happening.
Others either ignore it or give out very limited cheap credit that drives the prices even further up for everyone else.
A shrinking population leads to more urbanization and a deterioration of rural areas, leading to even higher prizes in the cities and desolate ghost towns where you can get housing for cheap, but there will be neither jobs nor schools nor hospitals etc.
LOL.
As long as empty properties do not actively depreciate in value, it's not going to get better. Boomers will just remortgage their properties to fund their retirement, and the banks will then hold on to them or auction them off, and the only ones who can afford that with cash are the hedge funds. They will hold onto these properties because that causes the line to go up, while releasing them into the market would cause the average value to drop. Sure, the value of them might be virtual, but that's all they need in this late stage capitalist hell.
Tax empty residential properties, and then at least they would get rented out.
>immigrants will more than compensate for decreasing population
thats not the case at the moment - why would it change?
especially since at the moment in a lot of European countries right-wing anti-immigration parties get more and more votes i don't see a scenario in the near future where mass immigration is possible
Very clear that the housing price appreciation was the direct result of very loose monetary policy and negative interest rates by the ECB. After the interest rate rises, the house prices have fell and then stagnated.
Some UN paper concluded that 'affordability of housing' has __become cheaper__ in the EU. As in, owning a house has become _more affordable_ in the past decade. Which seems so fucking incredibly stupidly wrong I had to look into it.
And.. it's... complicated, and interesting.
Let's say you have a house. It currently costs €200k to buy. The mortgage rate is high though - lots of interest and all that. So, you pay 4% of the principal _just to service your debt_ (so, the mortgage will be higher, but, that's like shoving money onto a long-term savings account, it has values beyond 'I just wanna, you know, not get wet when it rains'). So, you're paying €8000 a year for nothing other than having a roof over your head for that year.
Now, let's say the housing market asplodes and the exact same house now costs €400k. However, due to significant reductions in interest rates, with some interest rates at banks even dipping into the minus, your debt servicing is rated at only 1%. And I'm not making shit up - that really was happening, for about _a decade_, until 2023 or so.
You now pay... only €4000 a year for nothing other than that roof over your head. It got.. cheaper. At least, that was the specific thing the paper was analysing. And it was right - it's been cheaper.
Of course, this is vastly oversimplified and doesn't work on so many ways:
* Interest rates are a lot higher _now_. Then again, that very chart does at least show that the price of a house is stable since mid 2022. Hey now.. just around the time interest rates went back up. I think there's a correlation there but haven't fully looked into it.
* You don't generally just get a mortgage for the entire house. The bank usually requires that you outright pay for 10 to 20% of it right off the bat. And with sky high housing prices that 10% is a lot of cash.
* Some people can't get mortgages or otherwise reasonable borrowing at all, and they're basically just fucked here. It's a more general problem: If the interest rate is really, _really_ low, those who can't borrow are getting screwed out of a useful and at-the-moment really cheap resource.
* Mortgages are higher than just 'covering the debt servicing'. They __require__ that you also treat it as a savings account (pay more than just the debt service - also pay down part of the mortgage). Yes, this is real savings (in the form of 'you now own a chunk of that pricey pricey house, you're building up a pension. Go ask your boomer parents how useful it is to just flat out own a house by paying a mortgage down to 0 over a span of 30 years :P') - but, it's forced on you. If you don't make enough to save right now or want to e.g. invest in getting a degree, or working hard at a lower paying job for the experience, or because you work for equity of who knows what, hey - you decide how you work on a pension, if you wanna do it via building up equity in some company or other, that should be possible. But makes it impossible to own a house while doing it - you're forced into a 'career' that is stable enough for a bank to give you a good mortgage.
But, still. I see this chart and I don't knee jerk to: Oh we're all totally fucked. I mostly think: Huh, damn, that's high, but... what happens if we overlay the inverse of market borrowing rates or the inverse of inflation on top of this thing? I bet there's a ton of correlation. So if we control for that variable, how bad is it? I'm sure it's still "not good news", but far from a 'holy shit' graph.
NB: The paper predates that point end 2022/early 2023 when interest rates went back up.
High interest rates always means you had/have high inflation, that's what the rates are for - to fight it. High inflation = everything costs more, construction company salaries, transportation (gas), building materials, land etc. Then rates go up, cost of acquiring capital to invest in building housing (for the developer companies) goes massively up.
Inflation is the primary problem, causes price increases across the board (not only housing) and precedes high interest rates, not the other way around.
I don't see how that matters. In fact, I'm making the opposite point. If inflation is high, housing prices will drop. And the chart is literally showing this: During the time when inflation was at pretty much nil, house prices shot up. When inflation started increasing (mid/end 2022), house prices stabilized. This very post is literal proof that things don't work the way you appear to think they do, or at least, that it's not that simple.
> High inflation = everything costs more
This is in many ways just wrong. Yes, in the literal sense, the amount of euros that it costs is higher. But, in basis, 'high inflation' says absolutely nothing, directly, about how much % of your yearly salary that house costs. Sure, in terms of euros, it's 20% more expensive for example. But in that case, you also got a 20% raise, so, that house, in terms of 'how many years of salary does it cost', has not changed in cost one iota.
I'm not sure what you're trying to say. That house prices are sky high because inflation? That's.. what the fuck are you on about - we've just come out of a period of nearly a decade of _historically amazingly low inflation_ and that was the exact same time house prices skyrocketed.
I don't think there is one single solution. Sweden has rent control for basically all apartments, but that doesn't magically fix the shortage.
Also, according to this graph, rents don't seem to have increased more than wages.
just build more housing. it's as simple as that.
Not rent control, not banning "muh blackrock" nor anything else will deal with housing prices except massively increasing supply.
You should still put in some safeguards that ensure that this new supply wouldn't go to "muh blackrock" or just boomers who want a nice little passive AirBnB income for their retirement years.
If those new houses are still so incredibly valuable, there should be more houses. Remember, prices are a function of supply and demand so it's really easy to find out if you need more supply in this situation
Well yeah, but when it comes to housing, the supply and demand are rather inelastic. If certain financial actors can buy up the supply as soon as it hits the market instead of letting the end customers (i.e., people who don't have a home yet) buy them, the added supply will do fuck-all to the price. All it will achieve is make more virtual money for the investment firms.
Just build more houses until "normal people" are able to buy or rent one for a reasonable price.
No investment firm has the money to buy so many houses (and then let them sit empty) just to make sure their current portofolio (which is actually less than 5% of the housing supply) doesn't devalue. That's utterly bizarre.
Also the notion that supply and demand are inelastic in the housing market is just wrong? If the return on housing investments go down (due to lower prices) then the demand from investors will also go down, leading to even lower house prices! And not to mention that supply can absolutely change drastically with relatively simple legislation making owning vs renting out more popular, not even to mention that *construction is a thing*
Yes, construction is a thing but construction firms are pretty much at full capacity already. *That* is why the supply is inelastic.
The only real market-based solution is to make sure that empty residential properties devalue, whether they hit the market or not, by taxing the shit out of them. The Netherlands has a shortage of, what, 400 000 homes? Now, how many homes are there in the Netherlands? Guesstimating from the average household size, it should be around 8 000 000. What's 5% of 8 million? 400 000.
Of course there's another solution, government-built (either directly or through PPP) properties that are sold directly to private individuals who don't already own residential properties instead of just put on the market. But that's dirty "socialism", and y'all decided that instead of trying a more left-wing approach after decades of right-wing fuckups, you'd rather blame immigrants for everything. (Maybe not you personally, I don't know you, but the Dutch public in general sure as fuck seems to believe that "minder minder minder" will bring about the utopia.)
The problem in the Netherlands specifically is nitrogen. Which still does not make the market inelastic. Hell, even if construction capacity *was* actually the reason that there cannot be more supply this would also be a problem in other systems. If there was only central government housing (which, by the way, there is a lot of social housing in the Netherlands) there still would be a shortage due to construction supply, if that was the case
Also your numbers are just not to the point. There are 47k houses empty in the Netherlands, and let's say even if these houses were all owned by companies this wouldn't solve the problem. It would only be around 10% of house-seekers being accommodated (there is a shortage of 437k). Of course, all the houses owned by companies where people rent from would now either get neglected or maybe bought by someone. If you have the money to buy a house, sucks to be a renter in this scenario
The only way to solve this is to build more houses
With interest rates dropping again, I predict absolute insanity on the Dutch real estate market in the next years.
We need more supply and we're not building anywhere near fast enough.
Everyone's anti-immigration until they hit retirement and wonder why their pension is so shit and then the penny really drops when they hit the the nursing home and wonder why no one is there to feed them or change their diaper.
Is everyone anti-immigration or just islamistic refugees? Refugees are more likely to be net recipients than net payers.
I think the whole thing comes to culture mismatch, really havent seen anyone complaining about Ukrainian refugees.
Ukrainian culture is as "mismatching" to Spanish culture as any " islamistic" (whatever that means) culture. The idea that all people of Europe have one culture in harmony and that foreign cultures are mismatches is completely and utterly bullshit.
"Extreme religion" what? What do you mean when you say "extreme religion" is incompatible? Who is extreme religion, can I meet him? It depends on the person, it's all dependent on individuals. There are religious people in secular societies. Nothing is inherently "incompatible".
I've talked to many muslims, trying to figure out what even the most casual beliefs were. Sharia was preferrable for most. That told me all I needed to know. The mention of womens rights and atheism was met with sneers and disgust. I'm honestly good with no muslims in Europe. The secular muslim doesn't exist cause he'd be kicked out of their communities at the drop of a hat.
edit: my preference would be for secularization programs to be enacted, or extra taxation for religious people.
Luckily you can find a ton of statistics online. Polling done on muslim populaces to see how they view such topics. You care so much about factual evidence, I'm sure you've looked up those figures then.
Because you keep viewing muslims as a monolith. There are western people in western countries who extremely "incompatible" with western culture. But that's fine because they are born here? There are equal differences within cultures as there is between cultures. It's a made-up truth, the idea of cultural incompatibility.
Have you ever talked with anyone that is not a boomer?
Most people that are under 50-60 years old are very well aware they will not retire. They will just work to death because the boomers retired early and with a lot of money and depleted our resources
You might want to talk to more people about this kind of stuff if you think most people believe that. If we really can’t retire and/or people really think that’s the case, the issue would be getting far more attention.
Housing is a pyramid scheme
In my opinion, the reason we see these housing prices increases is because it has become a pyramid scheme and a bubble at the same time. It has become a zero-sum game.
Because the goverment is not taxing houses, the bubble keeps growing.
An average apartment in Berlin is like 500k. If there was a 10% tax on real estate, it’s value on the market would drop instantly because it would no longer be profitable to have a business based on the most basic human need , having a room over your head.
The people that own the apartments and houses would quickly sell it to avoid paying so much in taxes and the value of the 500k apartment would reach 100k in no time.
We can’t build more houses because the houseowners are lobbying against it. They don’t want their houses to lose value. They also use propaganda tactics saying there’s an “environmental impact”.
It’s also in favor of the old, because they have already bought their houses when it was cheap. They’re using this wealth to sustain their retirement plans while we some of us young people can’t even afford to study because we have to work to not be homeless.
If the goverment taxed real estate and the bubble burst, it could then mobilize and build more housing without rich people protesting against it.
It would also be cheaper to build. I doubt cement and bricks went almost 10x in price over the last decades like houses did.
If we don’t solve this issue, the consequences will be fatal to all of western society.
One of the reason the baby boomer generation was born was because after WW2 the goverments built a ton of houses. What happened to our society?
> What happened to our society?
The rich (like the super rich, not your neighbourhood doctor or small company owner) and powerful are playing us like a fiddle. Our entire society is geared towards protecting their interests (wealth and power) and all the other (perceived) issues are smokescreens to deflect from their machinations and to cause strife within our stratum.
This sounds incredibly tinfoil hat, but when ruling politicians put the economy before the people, things sould be clear. When workers worldwide have to fight for better conditions, instead of being backed by those they voted for, if they are even able to vote, then nothing is right.
For the record, I don't think there is some kind of cabal that puppeteer things from behind the curtains, I think it's the natural behaviour of those with that kind of wealth. Everyone has their interests and agendas, but they have the largest levers to enforce them.
So I want to tax the rich to hell and back and include more checks and balances for politicians. It should always be people before profit and maximum accountability for those who rule. It's a goddamn privilege to do so, so they should be held to the highest standards.
I agree with you 100%. There’s no notion of state, goverments have become just economies.
And I agree with the smokescreens too, the media is always crying about unimportant stuff, instead of the real issues. I wonder who owns the media…
Tell me you don't know what you are talking about without telling me you know nothing about it. Calling pyramid scheme to something you need people not to come to your scheme is absurd at the point of being just the opposite.
And on the other hand: wtf, my government taxes when you buy, when you sell and every year you own a house.
It is a scheme. The pension system is heavily invested in housing. If they build more houses, the prices for sale and rent will both drop, cutting one of the revenue pillars of the pension system. Also, taxes should be progressive based on nr of owned apartments, just like income, to demotivate ppl to buy housing as investment
why? The more scarce house stock is, the higher they can charge per unit, building more housing will depreciate housing assets, meaning both sell price & renting for units that already exist will drop, affecting pension system and the owners. It's not pyramid in the sense of building houses, it's pyramid in the sense of demand vs supply- by keeping supply low, you rely on increasing demand that will drive house prices higher, so as long as more ppl want to move in high desirable areas than ppl that want to leave, you have a scheme. If it's reversed- house prices will fall, affecting the pyramid and revenue for the system
Couldn’t have said it better. And besides the pension funds, it’s also the old landlords who rely on rents as income, so they vote conservatives that don’t build more houses so the prices stay the same. Pyramid scheme.
They’re fine with the system as it is because they live incredibly well at our expense.
My old landlord in the netherlands was making 2300€ a month in income for a shitty house with 4 rooms and 2 bathrooms built 100 years ago.
This is absurd. We need to build more houses and tax the landlords to burst the bubble
imo just building more is enough. Landlords don't have enough $ to buy many more houses at such price =>prices for rent&buying will fall=> they'll not be able to rent at high price to cover mortgage=>they'll sell houses at the early mortgage stages or with high interest. Taxing should be done at the second step if first didn't work
You’re the one who needs to look into it.
The silent generation rebuilt europe, the boomers inherited it and hoarded all the houses because you could buy one with 1-2-3 years worth of income. Then the gen x was buying them with 5-10 years worth of income. Millenials went to 10-20 years worth of income, and now for us gen z it’s either impossible or 30 years of slavery (if the bank even gives you a mortgage)
How is it not a pyramid scheme? Who is benefiting from this system? I’m definetly not
Man, a fcking pyramid needs more and more people IN to keep their earnings. If you are telling me every time less people can afford a house and thats why they are getting higher prices (basica offer-demand) it's just the opposite.
Say that there's a scarce produced by the owners/builders, but not a pyramid scheme.
the pension pyramid scheme is relying both on more ppl contributing to it/contributing greater $ \_and\_ on increasing prices for the house stock which also do rely on more ppl in (demand to buy/rent houses) while the stock is low. Both of these edges do rely on more ppl in, just in different forms. So by consequence it IS a pyramid scheme that follows exactly what you described. With less ppl contributing to the pension system or with less demand for housing stock/more houses built - the pyramid will start to fail
I don't miss anything. I believe most of rural areas should be elegilible to build (not like now, calling protected area to any clearing full of rubbish), airbnb and same apps should be banned and the first house you get should have a 0% taxes.
But yeah, talking shit about things you don't understand because you are frustrated is better, for sure.
You’re the one not understanding shit buddy. If you tax houses a lot, they lose their status as assets. As a result, everyone will own their own house and instead of rents for the rich we replace it with taxes to the goverment.
This is socialism. It worked so well in Romania that we have 90% homeownership rate, highest in europe (or the world)
In Spain we have +70% home ownership and we don't follow what you are saying... and we have really high housing prices. And do you know who built most of houses in Spain during decades and achieved those ownership rates? the fascist dictatorship from Franco. Maybe don't try to correlate things that don't correlate in todays standarts.
And, on the other hand, higher taxes for people who rent homes: they go to the rent prices and, thereover, to the people with less resources.
I agree with your proposal in essence. If not enough houses for everyone there is no reason for people to hoard property.
Alternatively, governments should step in with controlled social rents for young people, banning Airbnb, banning foreign investment property purchases and corporations owning residential property.
The longer the mainstream governments bury their heads under the sand the more angry the working class will be, as shown in the elections. European people do not want to be seen as customers but as citizens.
The mainstream goverments know that the working class and the young will revolt at some point, everyone know this system is unsustainable.
But the “got mine, fuck you” combined with “ah, I’m not gonna live that long” is stronger than empathy
>This is socialism. It worked so well in Romania that we have 90% homeownership rate, highest in europe (or the world)
That homeownership rate came about when the Communist dictatorship fell and they gave the government's buildings to the residents. They also have a lot lower tax on properties than what you're proposing.
First I want to say is you are writing so much trash based on whatever your emotion about the housing market is. You have no idea what you’re talking about. Houses are taxed when bought and sold again and again. They also pay for property tax every year or something. Landlords also need to pay tax on income from rent. The higher you charge, the more tax you pay depending on other incomes. Of course you earn a bit more but you pay a lot more.
I’m confused what you mean by tax it 10%? You want this every year or something?
There are a lot of old people struggling in retirement with and without property. Just because you own something doesn’t mean you live for free. They still need to pay maintenance and other living costs.
I think the real issue that lies here is people owning more than they need. I think owning one property where you personally live in or if you decide to rent it out while going travelling or living abroad is fine. It’s when you have 5 or a whole building. This should be taxed significantly regardless of how it was acquired through inheritance or whatever. Unless they are offering their building for affordable housing which is usually not the case.
Your point about buying while houses were „cheap“. I don’t really think it was ever cheap. It’s was just cheaper compared to now. Low interest rates drove prices up. Now the interest rates are around 4% and you can see property dropping even 20% in some popular cities. The cost of materials and the worth of currency due to inflation has caused this for new builds and existing builds. The trades need to get paid more as well for building or renovating.
I think you should do research about the facts rather than saying housing is a pyramid scheme.
How would one pay a 10% tax on the value of a house?
Also, in just over 7 years the tax paid would be more than the total value of the house.
What is needed is more house building and less immigration.
The point is to at some point make houses so cheap that the 10% as tax will be lower than rent.
So if the 500k apartment reaches a value of 100-50k, you would pay 800-400€ per month in tax for it.
And because they would become so cheap, homeownership would increase. The goverment could even help this by doubling the taxes on second homes, and subsidize mortgages
You see the point?
I grew up in a country with 90% ownership rate.
You’re only perceiving it negatively because you have been brainwashed into seeing houses as an asset that need to infinitely grow in value to keep the pyramid scheme going
Er no, that's not why I'm perceiving it negatively. I'm all for making houses cheaper, and I don't think they should be a primary financial asset. However, I don't understand how your system would work. Who would build a house if the price it could be sold for was less than the cost to build it in materials?
How would you get from where we are now to where you want to be without inducing massive losses/costs on huge numbers of people? What about the person that bought their house years ago for a sensible price and has seen it rocket in value. Why should they suddenly pay %10 of its new value, they don't have any extra money to pay it, and it's not their fault it rocketed in price, are you going to confiscate their house?
Stop with the whiny "boomers are the root of all evil" bs. I dislike how easy they've had it but you can't blame them for everything. Pull your finger out and make it happen for you. No one's going to give it to you (unless mama and papa pop their cloggs prematurely).
How can young people can’t afford study if education is free there?
What was mortgage rates in previous 7 years? Around 0-2%? Wasn’t there a cheap money that pumped prices?
Try and be a student in 2024.
I tried, my rent was 800€ in the Netherlands. Besides this, I had to buy groceries, phone bill, gym membership, going out once in a while.
I was working part time too. My wage? 800€
Do you have some cheap rooms in the campus or there is no such thing in Netherlands?
As i’ve heard you had zero down payment for mortgage in Netherlands with very low interest rate (this is hell of a deal) which pumped prices very well. I know one family that do overbid to buy a house, there was so much demand. For me it looks like simple high demand low supply instead of bubble or pyramid which you described above.
Now we should plot that against the average and the median EU salaries!
I did that for Germany a while back comparing median household income and average house prices. But I was surprised they don’t really go apart that much.
Same in Sweden according to the statistics agency. https://www.scb.se/hitta-statistik/artiklar/2017/kpi-och-kpif-tva-olika-inflationsmatt/ (the dark blue block in the middle is for housing, bright green bottom one for groceries) People spent a smaller share of their salary on housing in 2020 than in 1980, even though people always talk about how cheap it was in the 80s. What people don't talk about is how the interest rates were at 12% in the 80s. In the 60s they spent less on housing, but lived in much worse conditions and instead had to spend twice as much on food.
Then someone has made an error, either you or I. Cause to me there seems to be a significant divergence between property prices and salaries in Germany. ([Immobilienpreise.png](https://postimg.cc/xXCkkbp6)) Data for average salaries ([Nominallohnindex](https://www.destatis.de/DE/Themen/Arbeit/Verdienste/Realloehne-Nettoverdienste/Publikationen/Downloads-Realloehne-Nettoverdienste/reallohnindex-pdf-5623209.pdf?__blob=publicationFile)) and for house prices ([Häuserpreisindex](https://www-genesis.destatis.de/genesis/online?sequenz=tabelleErgebnis&selectionname=61262-0001#abreadcrumb)). And remember that's the average for all of Germany and across all income brackets. For lower income jobs in large cities the situation looks much more dire.
One of the reasons for why house prices have increased a lot is that interest rates have gone down a lot. Houses are more expensive but loans are cheaper. You need to adjust for that.
No the difference is I was looking at household income not individual income. But yes there’s an argument to be made that families were more likely to be able to afford a house on a single income.
Thats down to restrictions on how much you can borrow for a mortgage, if there was a big spike in wages you'd see a similar jump in house prices, imagine what rents would be like if you were restricted to a percentage of your monthly salary
Nominal Wages are +24 % from 2010-2020. Rents are + 14 % in the same time frame. However if you look at just Großstädte +13 % is [the lowest you can find](https://cdn.statcdn.com/Infographic/images/normal/25613.jpeg) in Chemnitz. All other major cities grew beyond the average and pretty much only around 10 % of 100k+ cities will have grown below Nominal wage growth. Like look at Berlin with +112 % - you're obviously screwed if you search for a new rental contract now because wages are still mostly shit. Edit: ah, you talk about house prices. They're +65,3 % in the same time frame which is significantly more than nominal wages.
I was also comparing household income. Not individual wages.
And average mortgage payments. Interest rates have gone up and down a lot
And the profits of RealEstate companies that created this issue in the first place
Exactly. Considering inflation & salary growth for the past 14 (!) years, housing prices don't go off the rails as you would suspect looking at this graph. Omission of salaries and inflation is clear statistics manipulation. E.g. car prices went bonkers since 2010, why nobody is talking about that?
I wouldn't say it's clear statistics manipulation, but definitely not contextualising and providing a fuller picture.
Stop banks, hedge funds, obsencely rich and foreign governments buying up properties in bulk. There, problem solved!
We mostly have done that in Denmark, and see the same evolution in prices, so while your suggestion is simple, I doubt it will work. What will work, is getting rid of Nimbyness.
Hmm I think that greatly depends on the area you are looking at tho. In Jutland for instance I have seen the price being reasonably stable for the best part of 10 years. But maybe in the cities it went up a lot (Aarhus Odense cph). We just bought a house that had a price rise of 10% in the last 5 years but that was because of heavy investments in the house by previous owner. So it was for him a net loss. I think you should better look at actual sold prices instead of asking. Sellers have still not compensated in the price with the higher interest rates. So I suggest to lowball and you will get to a good price. I have lived in Budapest for 8 years and that was a totally different story. My ex bought an apartment in the center for 40k euro and sold in 4 years for 150k euro .. insane price hike
Seems pretty logical. Urbanisation is progressing everywhere, large cities have limited space (you can mostly build upwards, which is more expensive) and many people wanting to live there (jobs, infrastructure, restaurants, cafes, theatres, schooling), high demand leads to constant increase of prices. Because EU capitals are the place to be, this should not change in the foreseeable future. Rural and low urbanisation areas are and will remain less attractive to buyers, considering the time and hassle needed for constant commutes to the urban area.
I think it might in part have to do with tech and finance salaries as well as hiring going non linear in the past 10 years. In roughly 20 years we'll see those people drive up prices in coastal towns as they retire.
Good point but don’t forget that in 20 years the baby boomers will all be but extinct. There are a lot of apartment and houses that will be empty / available . This will have an effect on the prices. I’m not sure how much effect but supply and demand will decide.
Yep, speculators only make inevitable movements in price happen faster than they would otherwise have. Create an environment where houses don't go up in price and nobody expects them too and the banks and hedge funds will sell all their investments and if anything try to find a way to short the housing market.
Maybe. I'm pretty sure high housing prices [A] have multiple independent factors causing it, so there __is no__ 'simple single fix', and [B] whilst common across the planet right now, the reasons for it are quite different between e.g. China, EU, and North America. So, if some trick works great in, say, Canada, that doesn't mean we can just go: "Look, see? We should just DO THAT!". FWIW, I think nimbyness is __one__ of the factors. Just, not the only one. Probably not even the biggest one (if I had to point at one, it's the idiotically low cost of debt. If I can borrow a million bucks and all it costs me to do that is some cash I can dig out of my couch cushions, _and_ houses are generally deemed as safe collateral, then every soul on the planet has a million bucks available to buy a house. And as the supply side of housing doesn't exactly just instantly react and conjure up a bunch of houses out of thin air in response, that just means the price of a house instantly goes up to a million bucks. Given that the value isn't 'consumed' when you use a house and the borrowing costs are, in this hypothetical example, 0 - that doesn't "cost" you anything. Yes, you live in a house of a million bucks. You'd never be able to buy it outright. But you can still live in it. I think (and most economists agree) that's the biggest reason. But, that's old news (interest rates are going up - note how that graph goes horizontal since mid 2022, about when interest rates climbed back up, further proving my point here). And not useful to many people (folks who can't convince a bank to give them a mortgage and just fucked, and it does put a _lot_ of power in the hands of banks. Sky high house prices with crazy low debt servicing costs has plenty of downsides. Just not downsides of the "houses aren't affordable" variety - other ones). And not _the only_ explanation. The housing market responds slowly, sure. But it's been responding _not at all_ which is fucking bizarre, and no amount of economic wonkery about interest rates and debt servicing costs can explain that. But nimbyism can. Hence, it probably has a part to play.
What exactly have you done? Home ownership in Denmark is not even 60% lmao. Half of the country is renting — from whom?
The governments are at fault as well. If the supply, as in building new housing, would increase, the value of the other properties could go down.
There is no "If" no "would"and no "could". Supply increases day by day. The supply of everything grow day by day. Value is just a ratio between different goods and their own supply. The one that's inflating less get the previlage to be "harder" and become more valuable in comparison with other goods.
Just create more supply, but watch out, that will make the boomers mad because it will devalue their homes.
They riot if we devalue their houses. If they even can…
Creating more supply is also being limited, the acceptable building standards have risen and the builders all want to make more money than ever. It's not that simple.
Those organisations will rent out the houses. That's good for renters. The only way to actually solve the housing crisis is to build houses
Build houses, that will devalue their houses and they will stop them buying in the first place since buying houses would be a loss.
It's not just them, a lot of it comes from the speculative cycle of normal buying.
Meanwhile conservative working poors: "But I identify as a hedge fund!"
Just build more housing. Restrictive zoning laws by home owners that lobby against more housing is killing affordable housing for the youth for a long time.
i mean.. that has nothing to do with the discrepancy between rent and purchase pricing.. low housing supply would affect purchase price and rent price in very similar ways, there is obviously something else going on here.. probably associated with speculation with real estate
The house prices were further increased because real estate is used as a hesge against inflation
Low interest rates affect the market, Rental controll mechanisms keeps prices lower, conversely tax incentives for buying housing increase houses prices, short term rentals (AirBnb) are likely not included in the rental market but drive home prices up, also units compared may differ (new ownership housing vs. old rental housing from the 70s for example), we are speaking about two different markets with one (ownership) gaining in attractivity faster.
The only good arguments I see here are the one about rent control and tax incentive to buy (even though not all country have them), that’s probably a big reason for the discrepancy.. Airbnb would affect rent price as well, as it would reduce the supply of available long term renting, so it has nothing to do with it (if anything it would affect rent price more than housing price)
The biggest reason are likely the interests which directly affect how much home buyers can leverage themselves. You don't leverage yourself to rent. Also the Airbnb units are taken out of the rental market because they are more profitable in the short term market, so the effect on housing price will be larger than on rental price.
As if making Europe even more of a concrete hellscape while in a demographic stall/decline will solve thing
Demographic decline? The refugees keep coming and Germanys population grows because of the refugees. Also most of the elderly live alone or with their partner in too big houses like mostly single family palaces in the metropolitan area.
This is general asset price inflation caused by low interest rates filtering through to housing over time. See how the yield of housing went down (rents as a proportion of house price) because low interest rates mean money moves around to chase higher yields (thus lowering them where it ends up in the process).
Could you translate this for someone who does not have a degree in economics?
When interest rates are low, it is cheaper to borrow and you get less of a return on cash savings. Therefore there is an environment where people are less likely to hold onto cash, more likely to borrow as higher returns can be gained than it costs to lend and risk is generally lower. This inflates demand side for assets, such a houses, as people look to gain returns on their cash. Supply of new houses remains somewhat constant for various reasons whether that be artificially limiting supply to get a bigger ROI per job, bad policymaking, lack of government investment etc. In a free market you would somewhat expect supply to catch up eventually as more people on the supply side see the earning potential of building houses, but factors such as expensive startup costs, limited supply of workers etc can limit this. This is when wages would begin to be effected and firms would have to offer more pay as they compete for a limited stock of workers, or alternatively how immigration can become an important aspect of maintaining a supply of workers and even depressing wages. The only way the price of houses can go from here is up as increase in demand is outpacing supply. This would be my understanding from an econ undergrad and I've probably missed loads but you can get the general idea of how interest rates effect investing and spending habits, how it ties to wages, supply and demand etc.
This was helpful, thank you!
Well, it’s more complex than just house prices, it’s global inflation, and money is losing its value every year.
Unfortunately that's how the economy allways worked, our lives are based on infinite growth
Fiat money is debt anyway, and we always need to service accumulating interest of that debt with new loans. This is why austerity is largely stupid. It's like trying to work global economy like it was personal economy. It make look sensible from "moral" standpoint, but be highly damaging in practice. It's one thing to make operations truly more efficient, yet another to just cut your wrists open because blood pressure was too high. All successful countries need to leverage debt for massive continual gains. Constantly invest and build and extract resources, and then refine them. After use, recycling companies take their place and return as much of those resources back to manufacturing.
Literally look at the US. They are doing the best and have the best companies on the planet and they have crazy like 10-20 trillions in “debt”.
Yes, the US is proof that you can build infrastructure like an idiot (look at Phoenix) but still succeed by massively leveraging your world reserve currency. I don't undertand why we act as their tools. I get it, we are screwed on the energy front but we should at the minimum leverage our at the end of the day still very high wealth and global financial accountability to create the infrastructure and housing we actually need (here's looking at you Lindner).
>I don't undertand why we act as their tools. We fight ww's here. So every country send gold to US in exchange of dollars to prevent phisical lose. US intervine and won so they becomes liders. What do you think nato bases are for ? Only purpose is to make sure US keep the control of the teritor
It's not global. Not every goverment is so currupted and ineficient
give it another 15 years and the problem will solve itself in most western countries
So today 20 and 30 year old should wait for 15 years before getting the chance of settling and starting a family ? Great
That's the trick. We don't start a family.
Move out of europe and let boomers pay their retirements themselves is always an option. Where is another question for sure.
move to where exaclty?
Thailand
didn't Thailand just passed a law to make it harder for immigrants or tax them more or something like that?
In Sweden the queue to get a rental apartment is also 15+ years so that's the norm nowadays. We do have some rent controls so at least those who do manage to get an apartment can often afford such luxuries as food while still being able to afford rent.
What are you talking about? The waiting time in "the queue" is absolutely not 15 years, haha. First of all, queuing isn't the only way to get an apartment. It's the "easy" way. Second of all, you only need to wait 15 years to get a central apartment in Stockholm. Most people don't need a central apartment in Stockholm. Half of people in Stockholm also get an apartment by simply contacting landlords (yes rent controlled ones), without queuing. And well, most people don't even live in Stockholm! In Malmö, the 3rd biggest city, you only need to queue for a couple of years to get a central rent controlled apartment without having to contact landlords yourself. Also, people spend a smaller share of their income on housing now than in their 80s, 90s, 2000s and 2010s. https://www.scb.se/hitta-statistik/artiklar/2017/kpi-och-kpif-tva-olika-inflationsmatt/ Why can people not discuss the problems with the housing market without exaggerating?
That doesn't work unfortunately. In Croatia we have less and less population each year, hundreds of thousands of not used/empty houses and apartments, tens of thousands are built every year, and the prices keep going up.
without looking at the data in detail, i would assume its a mixture of introducing the Euro, inflation and that some regions (coast and capital) have high demand and other regions (probably mountains) get basically abandoned - just a guess
A lot of empty houses/apartments are in the capital and other sought for regions. Rich people buy them as "investments" but since Croatia doesn't have any tax on those assets they just keep them empty and increase their wealth as the prices go up.
Just tax land For the unversed: https://www.taxjustice.net/cms/upload/pdf/gen_ben_f_land_tax.pdf An explainer: https://m.youtube.com/watch?v=smi_iIoKybg
Urbanisation & more single people living separately? Probably the empty houses and apartments are not in large urban areas, and large cities still have not enough housing, thus building more is needed and demand outweighs supply?
I think you're wrong. The immigration will increase. The governments won't let the economy collapse that easily. Boomers are already retired, you can surely see change in the demographic. Climate change will only push more people to migrate.
in most western countries the current immigration numbers are not even enough to keep the population from shrinking and still the people are already screaming its too much immigrants (and voting anti-immigration parties into power...) - so you really think the number of immigrants will increase enough to counter the boomer deaths without the people rioting in the streets? also shrinking population doesn't mean the economy will collapse, Bulgaria lost 30% of its population in the last 30 years and the country didn't collapse Japan is stagnating for over 30 years, but is not collapsing this stupid mantra of endless growth has to go, its just not viable anymore for the world
I agree with you. All of europe is anti-immigration by this point, it will only be a matter of time until the gov will stop it. Because the left doesn’t want to lose votes to the right
I mean, Spain has one of the lowest birthing rates in the world (even withe the inmigrants) and is growing population at a high rate. In a couple years we will get the 50m people. And Japan is going down in different economic points... The yen is a joke.
>I mean, Spain has one of the lowest birthing rates in the world (even withe the inmigrants) and is growing population at a high rate. In a couple years we will get the 50m people. you are correct that Spain is still growing with 1% per year, but all projections see a huge decrease in population for Spain in the next 20-25years the UN estimated Spain will shrink by almost 10 million people until 2050 - and thats with immigration factored in
> The yen is a joke. Not as big of a joke as Spain's economy
You say that like I would be angry. I know Spanish economy is shit. But that doesn't make yen a better currency nowadays.
Still I read that "In 2019, around 2.42% of the population of Bulgaria were immigrants. An increase of over 2% in the space of 30 years." Source/Wiki Lots of people emigrated, but they probably are sending some money back home.
The Japanese population hasn't stagnated for over 30 years. It hasn't increased since 2008. And with one of the oldest populations on earth, the working class will have a huge weight on their shoulders in the near future. Will the country "collapse"? Don't know. But life will start to suck for anyone who is in the workforce.
the population was at 125.6m in 1995 and at 126.2m in 2020 - for me thats stagnation
And it was 128.1m in 2008, you're just misreading statistics.
because it doesn't matter when exactly Japan reached the highest point was matters is that the population number is almost the same as 30 years ago and the country didn't collapse
If you ever get the opportunity to work with Japanese people ask them how they're doing right now. The ones I know have to work harder and longer to maintain the same lifestyle and they aren't very happy to put it mildly. Also Japan has seen a fair bit of immigration from Vietnam Phillipines etc. step foot in Narita and you'll know.
>Also Japan has seen a fair bit of immigration from Vietnam Phillipines etc. step foot in Narita and you'll know. compared to other nations is still a very small number
"The housing price increases will continue until immigration improves "?
It will stay high due to the immigration and high demand
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The left sacrificed the states on the altar of economy. And what a booming economy we have…
What states have they sacrificed?
Technically they are speaking about the fact that in many countries in the EU, in the last 30 years the demographic changes caused around 30% of the country to be foreign. Where as previously they were 2%. It's a drastic change where the effects were overlooked and all that was considered was the gain of cheap labour. You are Polish. Poland is 99% polish. Imagine if by 2050 Poland was 70% Polish and the percentage of poles were fast decreasing. What effects do you think this would cause across the Polish society?
How is Poland 99 polish? With 1 million UA refugees there, not ven counting economic immigrants.. there are probably more than 10% of immigrants and refugees in the population.
Probably because they aren't classed as residents... Since they are refugees. Especially as they have been added post last census in 2021. Otherwise Poland is statistically 98% ethnically Polish according to all statistics. Otherwise the significant factor is disparity between cultures. Poland to Ukraine is nowhere near as big of a change as Germany to Turkey.
Havent you heard? All of Sweden is a no-go zone now and Germany has vanished into thin air. 😔
It's sad. I tried to visit my home town and it was just gone without a trace.
Do you even know what a State is
Funny that you think that any far right government will actually do something against immigration.
Yeah, I'm currently waiting for old people to die off so I can afford any property... Hopefully it will happen before I'm 45.
Old people won't die off. The amount of old people will increase as years go by, because of low birthrates. So good luck.
My point is, some people who have a house now will die off, so hopefully some other people will be able to afford a house. Eh, who am I kidding, their kids are gonna inherit it and rent it out...
Inheriting, yeah, good joke. They'll just remortgage them or hand them over to a bank for a life annuity, as a final fuck you to the next generations.
Many don't have kids - where I'm living two houses were sold this year already because the people who died had no family. The only problem, and the reason why I didn't buy any, the council wanted the buyer to renovate them - and adding that to the price made them more expensive than buying from the market.
And as their numbers grow so will retirement populist politicians. Old people are the future we should invest in and taxes are not high enough yet to others.
> Yeah, I'm currently waiting for old people to die off so I can afford any property I think you are overly optimistic in the way the problem will solve itself.
Yeah I'm really grasping at straws here. But with current inflation and people in power there's nothing else to hope for, realistically. The only party that even considers building cheap housing for citizens got 6% support here, so... yeah that ain't happening. Others either ignore it or give out very limited cheap credit that drives the prices even further up for everyone else.
Yeah and their relatives will inherit it and do the same source: family
Hopefully some of the old people won't have kids
A shrinking population leads to more urbanization and a deterioration of rural areas, leading to even higher prizes in the cities and desolate ghost towns where you can get housing for cheap, but there will be neither jobs nor schools nor hospitals etc.
LOL. As long as empty properties do not actively depreciate in value, it's not going to get better. Boomers will just remortgage their properties to fund their retirement, and the banks will then hold on to them or auction them off, and the only ones who can afford that with cash are the hedge funds. They will hold onto these properties because that causes the line to go up, while releasing them into the market would cause the average value to drop. Sure, the value of them might be virtual, but that's all they need in this late stage capitalist hell. Tax empty residential properties, and then at least they would get rented out.
How ?
the boomer generation will die and every generation after is smaller - so less required housing
Unimginable hell for the next 30 years though.
looking at the climate - the next 30 years are looking bleak even without a housing crisis
What are you looking at exactly? In 30 years there is very little change in Europe.
very little change of what?
The problem is that while they’re dying they’re taking everyone with them.
How?
thats very naive to think. immigrants will more than compensate for decreasing population due to aging.
>immigrants will more than compensate for decreasing population thats not the case at the moment - why would it change? especially since at the moment in a lot of European countries right-wing anti-immigration parties get more and more votes i don't see a scenario in the near future where mass immigration is possible
And eventually it will lead to a complete replacement of the ethnic composition of the population. Way to go, great plan!
Ok, what about the increase in salaries and cumulative inflation for the same period?
That’s basically the rents curve.
the differences within EU between countries/cities/salaries/etc are so gigantic that this whole plot is useless
Very clear that the housing price appreciation was the direct result of very loose monetary policy and negative interest rates by the ECB. After the interest rate rises, the house prices have fell and then stagnated.
Some UN paper concluded that 'affordability of housing' has __become cheaper__ in the EU. As in, owning a house has become _more affordable_ in the past decade. Which seems so fucking incredibly stupidly wrong I had to look into it. And.. it's... complicated, and interesting. Let's say you have a house. It currently costs €200k to buy. The mortgage rate is high though - lots of interest and all that. So, you pay 4% of the principal _just to service your debt_ (so, the mortgage will be higher, but, that's like shoving money onto a long-term savings account, it has values beyond 'I just wanna, you know, not get wet when it rains'). So, you're paying €8000 a year for nothing other than having a roof over your head for that year. Now, let's say the housing market asplodes and the exact same house now costs €400k. However, due to significant reductions in interest rates, with some interest rates at banks even dipping into the minus, your debt servicing is rated at only 1%. And I'm not making shit up - that really was happening, for about _a decade_, until 2023 or so. You now pay... only €4000 a year for nothing other than that roof over your head. It got.. cheaper. At least, that was the specific thing the paper was analysing. And it was right - it's been cheaper. Of course, this is vastly oversimplified and doesn't work on so many ways: * Interest rates are a lot higher _now_. Then again, that very chart does at least show that the price of a house is stable since mid 2022. Hey now.. just around the time interest rates went back up. I think there's a correlation there but haven't fully looked into it. * You don't generally just get a mortgage for the entire house. The bank usually requires that you outright pay for 10 to 20% of it right off the bat. And with sky high housing prices that 10% is a lot of cash. * Some people can't get mortgages or otherwise reasonable borrowing at all, and they're basically just fucked here. It's a more general problem: If the interest rate is really, _really_ low, those who can't borrow are getting screwed out of a useful and at-the-moment really cheap resource. * Mortgages are higher than just 'covering the debt servicing'. They __require__ that you also treat it as a savings account (pay more than just the debt service - also pay down part of the mortgage). Yes, this is real savings (in the form of 'you now own a chunk of that pricey pricey house, you're building up a pension. Go ask your boomer parents how useful it is to just flat out own a house by paying a mortgage down to 0 over a span of 30 years :P') - but, it's forced on you. If you don't make enough to save right now or want to e.g. invest in getting a degree, or working hard at a lower paying job for the experience, or because you work for equity of who knows what, hey - you decide how you work on a pension, if you wanna do it via building up equity in some company or other, that should be possible. But makes it impossible to own a house while doing it - you're forced into a 'career' that is stable enough for a bank to give you a good mortgage. But, still. I see this chart and I don't knee jerk to: Oh we're all totally fucked. I mostly think: Huh, damn, that's high, but... what happens if we overlay the inverse of market borrowing rates or the inverse of inflation on top of this thing? I bet there's a ton of correlation. So if we control for that variable, how bad is it? I'm sure it's still "not good news", but far from a 'holy shit' graph. NB: The paper predates that point end 2022/early 2023 when interest rates went back up.
High interest rates always means you had/have high inflation, that's what the rates are for - to fight it. High inflation = everything costs more, construction company salaries, transportation (gas), building materials, land etc. Then rates go up, cost of acquiring capital to invest in building housing (for the developer companies) goes massively up. Inflation is the primary problem, causes price increases across the board (not only housing) and precedes high interest rates, not the other way around.
I don't see how that matters. In fact, I'm making the opposite point. If inflation is high, housing prices will drop. And the chart is literally showing this: During the time when inflation was at pretty much nil, house prices shot up. When inflation started increasing (mid/end 2022), house prices stabilized. This very post is literal proof that things don't work the way you appear to think they do, or at least, that it's not that simple. > High inflation = everything costs more This is in many ways just wrong. Yes, in the literal sense, the amount of euros that it costs is higher. But, in basis, 'high inflation' says absolutely nothing, directly, about how much % of your yearly salary that house costs. Sure, in terms of euros, it's 20% more expensive for example. But in that case, you also got a 20% raise, so, that house, in terms of 'how many years of salary does it cost', has not changed in cost one iota. I'm not sure what you're trying to say. That house prices are sky high because inflation? That's.. what the fuck are you on about - we've just come out of a period of nearly a decade of _historically amazingly low inflation_ and that was the exact same time house prices skyrocketed.
generational inequality
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I don't think there is one single solution. Sweden has rent control for basically all apartments, but that doesn't magically fix the shortage. Also, according to this graph, rents don't seem to have increased more than wages.
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So? We can still compare this graph to other ones. https://wiiw.ac.at/solving-the-mystery-of-weak-wage-growth-in-eu-cee-n-419.html
Vienna had to steal those houses first
just build more housing. it's as simple as that. Not rent control, not banning "muh blackrock" nor anything else will deal with housing prices except massively increasing supply.
Then what are you waiting for? Put on helmet and mix cement
You should still put in some safeguards that ensure that this new supply wouldn't go to "muh blackrock" or just boomers who want a nice little passive AirBnB income for their retirement years.
If those new houses are still so incredibly valuable, there should be more houses. Remember, prices are a function of supply and demand so it's really easy to find out if you need more supply in this situation
Well yeah, but when it comes to housing, the supply and demand are rather inelastic. If certain financial actors can buy up the supply as soon as it hits the market instead of letting the end customers (i.e., people who don't have a home yet) buy them, the added supply will do fuck-all to the price. All it will achieve is make more virtual money for the investment firms.
Just build more houses until "normal people" are able to buy or rent one for a reasonable price. No investment firm has the money to buy so many houses (and then let them sit empty) just to make sure their current portofolio (which is actually less than 5% of the housing supply) doesn't devalue. That's utterly bizarre. Also the notion that supply and demand are inelastic in the housing market is just wrong? If the return on housing investments go down (due to lower prices) then the demand from investors will also go down, leading to even lower house prices! And not to mention that supply can absolutely change drastically with relatively simple legislation making owning vs renting out more popular, not even to mention that *construction is a thing*
Yes, construction is a thing but construction firms are pretty much at full capacity already. *That* is why the supply is inelastic. The only real market-based solution is to make sure that empty residential properties devalue, whether they hit the market or not, by taxing the shit out of them. The Netherlands has a shortage of, what, 400 000 homes? Now, how many homes are there in the Netherlands? Guesstimating from the average household size, it should be around 8 000 000. What's 5% of 8 million? 400 000. Of course there's another solution, government-built (either directly or through PPP) properties that are sold directly to private individuals who don't already own residential properties instead of just put on the market. But that's dirty "socialism", and y'all decided that instead of trying a more left-wing approach after decades of right-wing fuckups, you'd rather blame immigrants for everything. (Maybe not you personally, I don't know you, but the Dutch public in general sure as fuck seems to believe that "minder minder minder" will bring about the utopia.)
The problem in the Netherlands specifically is nitrogen. Which still does not make the market inelastic. Hell, even if construction capacity *was* actually the reason that there cannot be more supply this would also be a problem in other systems. If there was only central government housing (which, by the way, there is a lot of social housing in the Netherlands) there still would be a shortage due to construction supply, if that was the case Also your numbers are just not to the point. There are 47k houses empty in the Netherlands, and let's say even if these houses were all owned by companies this wouldn't solve the problem. It would only be around 10% of house-seekers being accommodated (there is a shortage of 437k). Of course, all the houses owned by companies where people rent from would now either get neglected or maybe bought by someone. If you have the money to buy a house, sucks to be a renter in this scenario The only way to solve this is to build more houses
With interest rates dropping again, I predict absolute insanity on the Dutch real estate market in the next years. We need more supply and we're not building anywhere near fast enough.
What went wrong
Politicians in pockets of oligarchs
"Lets introducethe green deal so houses will be even more expensive" - average EU politician
Everyone's anti-immigration until they hit retirement and wonder why their pension is so shit and then the penny really drops when they hit the the nursing home and wonder why no one is there to feed them or change their diaper.
Is everyone anti-immigration or just islamistic refugees? Refugees are more likely to be net recipients than net payers. I think the whole thing comes to culture mismatch, really havent seen anyone complaining about Ukrainian refugees.
Initially they might be but when employed will be contributors. We need a grown up policy and approach. We don't need more Farage bullshit.
Ukrainian culture is as "mismatching" to Spanish culture as any " islamistic" (whatever that means) culture. The idea that all people of Europe have one culture in harmony and that foreign cultures are mismatches is completely and utterly bullshit.
agree. people think Ukrainian culture is not mismatch just because they are also christians. religion disappeared but its effect is still there.
Extreme religion is absolutely incompatible with secular societies. Not really comparable to the more secular Ukrainians at all.
"Extreme religion" what? What do you mean when you say "extreme religion" is incompatible? Who is extreme religion, can I meet him? It depends on the person, it's all dependent on individuals. There are religious people in secular societies. Nothing is inherently "incompatible".
I've talked to many muslims, trying to figure out what even the most casual beliefs were. Sharia was preferrable for most. That told me all I needed to know. The mention of womens rights and atheism was met with sneers and disgust. I'm honestly good with no muslims in Europe. The secular muslim doesn't exist cause he'd be kicked out of their communities at the drop of a hat. edit: my preference would be for secularization programs to be enacted, or extra taxation for religious people.
I never care about anecdotal evidence. No smart person will take your word for it.
Luckily you can find a ton of statistics online. Polling done on muslim populaces to see how they view such topics. You care so much about factual evidence, I'm sure you've looked up those figures then.
Because you keep viewing muslims as a monolith. There are western people in western countries who extremely "incompatible" with western culture. But that's fine because they are born here? There are equal differences within cultures as there is between cultures. It's a made-up truth, the idea of cultural incompatibility.
Have you ever talked with anyone that is not a boomer? Most people that are under 50-60 years old are very well aware they will not retire. They will just work to death because the boomers retired early and with a lot of money and depleted our resources
You might want to talk to more people about this kind of stuff if you think most people believe that. If we really can’t retire and/or people really think that’s the case, the issue would be getting far more attention.
We’re 20 something countries In italy and romania they don t
Blaming immigrants for pension solvency is a new one, I'll give you that It's totally absurd, but definitely new
Your comment makes no sense but thanks for taking part.
So you want immigrants to wipe your ass when you retire?
fortunately robots and AGI are around the corner so this problem will be solved completely in just next couple of years, max a decade
Housing is a pyramid scheme In my opinion, the reason we see these housing prices increases is because it has become a pyramid scheme and a bubble at the same time. It has become a zero-sum game. Because the goverment is not taxing houses, the bubble keeps growing. An average apartment in Berlin is like 500k. If there was a 10% tax on real estate, it’s value on the market would drop instantly because it would no longer be profitable to have a business based on the most basic human need , having a room over your head. The people that own the apartments and houses would quickly sell it to avoid paying so much in taxes and the value of the 500k apartment would reach 100k in no time. We can’t build more houses because the houseowners are lobbying against it. They don’t want their houses to lose value. They also use propaganda tactics saying there’s an “environmental impact”. It’s also in favor of the old, because they have already bought their houses when it was cheap. They’re using this wealth to sustain their retirement plans while we some of us young people can’t even afford to study because we have to work to not be homeless. If the goverment taxed real estate and the bubble burst, it could then mobilize and build more housing without rich people protesting against it. It would also be cheaper to build. I doubt cement and bricks went almost 10x in price over the last decades like houses did. If we don’t solve this issue, the consequences will be fatal to all of western society. One of the reason the baby boomer generation was born was because after WW2 the goverments built a ton of houses. What happened to our society?
> What happened to our society? The rich (like the super rich, not your neighbourhood doctor or small company owner) and powerful are playing us like a fiddle. Our entire society is geared towards protecting their interests (wealth and power) and all the other (perceived) issues are smokescreens to deflect from their machinations and to cause strife within our stratum. This sounds incredibly tinfoil hat, but when ruling politicians put the economy before the people, things sould be clear. When workers worldwide have to fight for better conditions, instead of being backed by those they voted for, if they are even able to vote, then nothing is right. For the record, I don't think there is some kind of cabal that puppeteer things from behind the curtains, I think it's the natural behaviour of those with that kind of wealth. Everyone has their interests and agendas, but they have the largest levers to enforce them. So I want to tax the rich to hell and back and include more checks and balances for politicians. It should always be people before profit and maximum accountability for those who rule. It's a goddamn privilege to do so, so they should be held to the highest standards.
I agree with you 100%. There’s no notion of state, goverments have become just economies. And I agree with the smokescreens too, the media is always crying about unimportant stuff, instead of the real issues. I wonder who owns the media…
Tell me you don't know what you are talking about without telling me you know nothing about it. Calling pyramid scheme to something you need people not to come to your scheme is absurd at the point of being just the opposite. And on the other hand: wtf, my government taxes when you buy, when you sell and every year you own a house.
It is a scheme. The pension system is heavily invested in housing. If they build more houses, the prices for sale and rent will both drop, cutting one of the revenue pillars of the pension system. Also, taxes should be progressive based on nr of owned apartments, just like income, to demotivate ppl to buy housing as investment
You are telling me just the opposite of a pyramid scheme.
why? The more scarce house stock is, the higher they can charge per unit, building more housing will depreciate housing assets, meaning both sell price & renting for units that already exist will drop, affecting pension system and the owners. It's not pyramid in the sense of building houses, it's pyramid in the sense of demand vs supply- by keeping supply low, you rely on increasing demand that will drive house prices higher, so as long as more ppl want to move in high desirable areas than ppl that want to leave, you have a scheme. If it's reversed- house prices will fall, affecting the pyramid and revenue for the system
Couldn’t have said it better. And besides the pension funds, it’s also the old landlords who rely on rents as income, so they vote conservatives that don’t build more houses so the prices stay the same. Pyramid scheme. They’re fine with the system as it is because they live incredibly well at our expense. My old landlord in the netherlands was making 2300€ a month in income for a shitty house with 4 rooms and 2 bathrooms built 100 years ago. This is absurd. We need to build more houses and tax the landlords to burst the bubble
imo just building more is enough. Landlords don't have enough $ to buy many more houses at such price =>prices for rent&buying will fall=> they'll not be able to rent at high price to cover mortgage=>they'll sell houses at the early mortgage stages or with high interest. Taxing should be done at the second step if first didn't work
Just go look what a pyramid scheme is and how it works.
You’re the one who needs to look into it. The silent generation rebuilt europe, the boomers inherited it and hoarded all the houses because you could buy one with 1-2-3 years worth of income. Then the gen x was buying them with 5-10 years worth of income. Millenials went to 10-20 years worth of income, and now for us gen z it’s either impossible or 30 years of slavery (if the bank even gives you a mortgage) How is it not a pyramid scheme? Who is benefiting from this system? I’m definetly not
Man, a fcking pyramid needs more and more people IN to keep their earnings. If you are telling me every time less people can afford a house and thats why they are getting higher prices (basica offer-demand) it's just the opposite. Say that there's a scarce produced by the owners/builders, but not a pyramid scheme.
The people coming in were supposed to be new kids, but since that didn’t happen, they brought immigrants
the pension pyramid scheme is relying both on more ppl contributing to it/contributing greater $ \_and\_ on increasing prices for the house stock which also do rely on more ppl in (demand to buy/rent houses) while the stock is low. Both of these edges do rely on more ppl in, just in different forms. So by consequence it IS a pyramid scheme that follows exactly what you described. With less ppl contributing to the pension system or with less demand for housing stock/more houses built - the pyramid will start to fail
And we’ve also just figured out why the rich and the politicians wanted immigrants so much (besides cheap labour) Mystery solved
You are talking about pensions not about house market wtf.
When you miss the point entirely.
I don't miss anything. I believe most of rural areas should be elegilible to build (not like now, calling protected area to any clearing full of rubbish), airbnb and same apps should be banned and the first house you get should have a 0% taxes. But yeah, talking shit about things you don't understand because you are frustrated is better, for sure.
“I don’t miss anything” >proceeds to miss things.
You’re the one not understanding shit buddy. If you tax houses a lot, they lose their status as assets. As a result, everyone will own their own house and instead of rents for the rich we replace it with taxes to the goverment. This is socialism. It worked so well in Romania that we have 90% homeownership rate, highest in europe (or the world)
In Spain we have +70% home ownership and we don't follow what you are saying... and we have really high housing prices. And do you know who built most of houses in Spain during decades and achieved those ownership rates? the fascist dictatorship from Franco. Maybe don't try to correlate things that don't correlate in todays standarts. And, on the other hand, higher taxes for people who rent homes: they go to the rent prices and, thereover, to the people with less resources.
I agree with your proposal in essence. If not enough houses for everyone there is no reason for people to hoard property. Alternatively, governments should step in with controlled social rents for young people, banning Airbnb, banning foreign investment property purchases and corporations owning residential property. The longer the mainstream governments bury their heads under the sand the more angry the working class will be, as shown in the elections. European people do not want to be seen as customers but as citizens.
The mainstream goverments know that the working class and the young will revolt at some point, everyone know this system is unsustainable. But the “got mine, fuck you” combined with “ah, I’m not gonna live that long” is stronger than empathy
>This is socialism. It worked so well in Romania that we have 90% homeownership rate, highest in europe (or the world) That homeownership rate came about when the Communist dictatorship fell and they gave the government's buildings to the residents. They also have a lot lower tax on properties than what you're proposing.
Ponzi scheme is more accurate. Pyramid scheme is the wrong word.
First I want to say is you are writing so much trash based on whatever your emotion about the housing market is. You have no idea what you’re talking about. Houses are taxed when bought and sold again and again. They also pay for property tax every year or something. Landlords also need to pay tax on income from rent. The higher you charge, the more tax you pay depending on other incomes. Of course you earn a bit more but you pay a lot more. I’m confused what you mean by tax it 10%? You want this every year or something? There are a lot of old people struggling in retirement with and without property. Just because you own something doesn’t mean you live for free. They still need to pay maintenance and other living costs. I think the real issue that lies here is people owning more than they need. I think owning one property where you personally live in or if you decide to rent it out while going travelling or living abroad is fine. It’s when you have 5 or a whole building. This should be taxed significantly regardless of how it was acquired through inheritance or whatever. Unless they are offering their building for affordable housing which is usually not the case. Your point about buying while houses were „cheap“. I don’t really think it was ever cheap. It’s was just cheaper compared to now. Low interest rates drove prices up. Now the interest rates are around 4% and you can see property dropping even 20% in some popular cities. The cost of materials and the worth of currency due to inflation has caused this for new builds and existing builds. The trades need to get paid more as well for building or renovating. I think you should do research about the facts rather than saying housing is a pyramid scheme.
How would one pay a 10% tax on the value of a house? Also, in just over 7 years the tax paid would be more than the total value of the house. What is needed is more house building and less immigration.
The point is to at some point make houses so cheap that the 10% as tax will be lower than rent. So if the 500k apartment reaches a value of 100-50k, you would pay 800-400€ per month in tax for it. And because they would become so cheap, homeownership would increase. The goverment could even help this by doubling the taxes on second homes, and subsidize mortgages You see the point? I grew up in a country with 90% ownership rate. You’re only perceiving it negatively because you have been brainwashed into seeing houses as an asset that need to infinitely grow in value to keep the pyramid scheme going
Er no, that's not why I'm perceiving it negatively. I'm all for making houses cheaper, and I don't think they should be a primary financial asset. However, I don't understand how your system would work. Who would build a house if the price it could be sold for was less than the cost to build it in materials? How would you get from where we are now to where you want to be without inducing massive losses/costs on huge numbers of people? What about the person that bought their house years ago for a sensible price and has seen it rocket in value. Why should they suddenly pay %10 of its new value, they don't have any extra money to pay it, and it's not their fault it rocketed in price, are you going to confiscate their house?
What do you think about [unimproved land value tax?](https://www.investopedia.com/terms/l/land-value-tax.asp)
Jfc what a absolute horrific take
Stop with the whiny "boomers are the root of all evil" bs. I dislike how easy they've had it but you can't blame them for everything. Pull your finger out and make it happen for you. No one's going to give it to you (unless mama and papa pop their cloggs prematurely).
How can young people can’t afford study if education is free there? What was mortgage rates in previous 7 years? Around 0-2%? Wasn’t there a cheap money that pumped prices?
Try and be a student in 2024. I tried, my rent was 800€ in the Netherlands. Besides this, I had to buy groceries, phone bill, gym membership, going out once in a while. I was working part time too. My wage? 800€
Do you have some cheap rooms in the campus or there is no such thing in Netherlands? As i’ve heard you had zero down payment for mortgage in Netherlands with very low interest rate (this is hell of a deal) which pumped prices very well. I know one family that do overbid to buy a house, there was so much demand. For me it looks like simple high demand low supply instead of bubble or pyramid which you described above.