There has been a bit of a revolution recently in the possible expansion of human rights, at least in this country. The assertion that “healthcare is a human right” that first emerged in Bernie Sanders’ campaign in 2016 seems to have taken hold, as most of the Democrats now running for president have embraced it. In the same way, “education is a human right” seems to be pushing us toward extension of free public education to both pre-K and post secondary. Now, in a time when affordable housing has become a national crisis, we are contemplating acceptance that housing is a human right also. While the first two above involve mainly an extension of services and materials, providing adequate and affordable housing is another matter entirely: our financial institutions and western culture are deeply implicated in our problems with land and housing and will require extensive structural economic and political changes.
If you don’t believe this is serious, there is this from the Wall Street Journal (6/20/19):
“High tech flippers are using algorithms to reshape the housing market. Armed with loads of cash and the latest in machine learning, investors are reshaping the 26 trillion dollar market for residential housing.” And in WSJ (6/21/19): “Big private-equity firms, real estate speculators, and others had a big advantage over families seeking a home to live in.” And in the New York Times (6/20/19): “Investors bought one out of five starter homes that were sold last year…close to half of the most affordable.”
I recently read an article from Great Britain, “Land for the Many: Changing the Way our Main Asset is Used, Owned, and Governed,” by George Monbiot and a group of six experts which lays out a plan for democratizing access and use of land. Although writing about Great Britain, the problems of using land as a speculative asset are exactly the same in the US and the rest of the world.
“Dig deep enough into many of the problems this country faces, and you will soon hit land,” writes Monbiot. “Soaring inequality and exclusion; the massive cost of renting or buying a decent home; repeated financial crises sparked by housing asset bubbles; the collapse of wildlife and ecosystems; the lack of public amenities—the way land is owned and controlled underlies them all. Yet it scarcely features in political discussions.”
The reason it is not being discussed is clear if you consider the newspaper quotes above.
While some cultures have never thought of land as “ownable” or have seen it as commonly owned by all, we have privatized all of ours except for public rights-of-way and certain public park and government properties. The thinking is that if you don’t “own” your land, you can’t depend on it into the future. However, having a reliable place to live does not mean we have to tolerate speculators. There are ways to have a secure place to live without owning the land. And we also need to resist the lure of mind-boggling profits to be had by flipping houses.
The report contends that decisions about community land allocations and the human and ecological impacts they will have simply are too important to be left to the speculative market. Good farmland is being converted to housing developments and tax laws foment fierce speculation and outlandish increases in property values. In Britain, housing values have increased by 544%, far outpacing wage and income growth. Two decades ago, a family needed three years to save up for a down payment. Now they need 19 years. No doubt it is similar here.
To as great an extent as possible, we need to remove land from the commodity market. The general solution is for land to be owned by a community development corporation. We can ensure private control over our individual homes while the land itself is owned in common. This is the land trust model we are familiar with on a small scale here on Vashon. With land owned by the community, we can eliminate speculation and preserve important land uses such as affordable housing, farming, and wildlife. By partnering with the community land trust, a prospective buyer might save as much as 70% of the cost of a property by having to purchase only the structures on the land. The new owner will have to pay a land rent, but it will go into a community fund. And the trust will own another piece of the community.
Other recommendations they make are changing tax law to discourage speculation, prodding banks to lend less for real estate and more for productive assets, restrictions on loans to buyers who intend to rent their properties, levying a progressive property tax, discouraging the elimination of low-income rental housing, and scaling rent increases to wage inflation and/or the consumer price index.
I am well aware that many in our community make their living in real estate speculation. At the same time, we need to realize that the ultimate result of this will be a wealthy bedroom community with nobody to fix the faucet, teach in school, provide nursing care, or work at the grocery store. Some of the poorer players in the speculative game may find that they themselves have been priced off the island. Let’s work to transition all of us out of this destructive cooption of what should belong to all of us.