1 00:00:02,720 --> 00:00:03,880 (Transcribed by TurboScribe.ai. Go Unlimited to remove this message.) Hello, everybody. 2 00:00:04,200 --> 00:00:06,000 Welcome back to another episode of The Way 3 00:00:06,000 --> 00:00:06,920 the World Works. 4 00:00:07,280 --> 00:00:09,400 Today I want to talk a little bit 5 00:00:09,400 --> 00:00:11,500 about the housing shortage that's going on in 6 00:00:11,500 --> 00:00:14,840 the country, but specifically the bad solutions that 7 00:00:14,840 --> 00:00:16,920 politicians propose to fix the problem. 8 00:00:17,340 --> 00:00:20,280 President Trump recently said that he would like 9 00:00:20,280 --> 00:00:24,120 to ban investment corporations from buying up houses 10 00:00:24,120 --> 00:00:25,660 that are for sale on the market. 11 00:00:25,660 --> 00:00:29,560 The reason is, he's saying, when it's not 12 00:00:29,560 --> 00:00:31,240 families who are going to live in the 13 00:00:31,240 --> 00:00:33,560 homes, when it's these big corporations just buying 14 00:00:33,560 --> 00:00:35,100 up homes so that they can rent them 15 00:00:35,100 --> 00:00:37,140 out or maybe sell them, then now people 16 00:00:37,140 --> 00:00:39,820 don't have access to housing because maybe they 17 00:00:39,820 --> 00:00:41,520 don't want to be renters. 18 00:00:41,660 --> 00:00:42,240 They want to buy. 19 00:00:42,340 --> 00:00:45,300 Now you're taking away homes on the market 20 00:00:45,300 --> 00:00:47,800 that people could buy, or it's forcing people 21 00:00:47,800 --> 00:00:50,700 to perpetually rent houses instead of being house 22 00:00:50,700 --> 00:00:50,940 owners. 23 00:00:51,900 --> 00:00:53,180 They're jacking up the prices. 24 00:00:53,320 --> 00:00:54,800 They're making it harder and blah, blah, blah, 25 00:00:54,840 --> 00:00:55,160 blah, blah. 26 00:00:55,160 --> 00:00:58,200 It's easy to see it this way. 27 00:00:58,800 --> 00:01:00,440 I always want us to look at that 28 00:01:00,440 --> 00:01:02,060 a lot of times when there are these 29 00:01:02,060 --> 00:01:06,780 proposals that don't make true economic sense or 30 00:01:06,780 --> 00:01:09,680 they're even harmful to individual liberty, sometimes they 31 00:01:09,680 --> 00:01:10,700 come from a good place. 32 00:01:10,820 --> 00:01:12,200 There is an old saying that the road 33 00:01:12,200 --> 00:01:14,000 to hell is paved with good intentions. 34 00:01:14,700 --> 00:01:17,160 That's basically what that means, that sometimes people 35 00:01:17,160 --> 00:01:20,060 have solutions that come from a really good, 36 00:01:20,140 --> 00:01:23,220 really caring place, but they don't understand that 37 00:01:23,220 --> 00:01:25,440 that's not logically how you fix the problem. 38 00:01:25,920 --> 00:01:28,860 And so this is one of these situations. 39 00:01:29,400 --> 00:01:30,660 All right, so let's dive in. 40 00:01:30,900 --> 00:01:33,120 Let's say your family is moving and so 41 00:01:33,120 --> 00:01:35,000 they are selling their house, they are putting 42 00:01:35,000 --> 00:01:38,360 their house on the market, and some people 43 00:01:38,360 --> 00:01:39,720 come to look at it and they have 44 00:01:39,720 --> 00:01:40,160 a choice. 45 00:01:40,280 --> 00:01:42,120 They can either sell to a family that 46 00:01:42,120 --> 00:01:44,880 wants to move in or they can sell 47 00:01:44,880 --> 00:01:48,260 to an investment corporation, somebody who wants to 48 00:01:48,260 --> 00:01:49,800 buy the house and then they're using it 49 00:01:49,800 --> 00:01:51,420 as an investment, meaning they're not going to 50 00:01:51,420 --> 00:01:51,760 live in it. 51 00:01:51,800 --> 00:01:53,980 They're using it to make money, which is 52 00:01:53,980 --> 00:01:54,220 fine. 53 00:01:54,220 --> 00:01:55,420 We're OK with making money here. 54 00:01:56,620 --> 00:01:59,660 So let's say you're torn because on the 55 00:01:59,660 --> 00:02:01,340 one hand, you know, maybe your parents really 56 00:02:01,340 --> 00:02:03,900 loved that they raised, you know, their family 57 00:02:03,900 --> 00:02:05,640 there and they want to see another young 58 00:02:05,640 --> 00:02:09,560 family have those same opportunities and investment corporations. 59 00:02:09,699 --> 00:02:11,080 They seem kind of cold, right? 60 00:02:11,080 --> 00:02:13,380 Like when I said family and you heard 61 00:02:13,380 --> 00:02:15,740 that word, you probably you probably had some 62 00:02:15,740 --> 00:02:17,160 images in your head of maybe like a 63 00:02:17,160 --> 00:02:19,160 playing fetch with a dog in a backyard 64 00:02:19,160 --> 00:02:21,360 or a family riding bikes or doing something. 65 00:02:21,360 --> 00:02:23,180 Then you hear the word corporation. 66 00:02:23,580 --> 00:02:25,940 I always just think of like a person 67 00:02:25,940 --> 00:02:28,700 in a suit with no face, not like 68 00:02:28,700 --> 00:02:30,940 scary, but like the face is kind of 69 00:02:30,940 --> 00:02:32,380 a shadow or it's too dark to see 70 00:02:32,380 --> 00:02:33,840 it like they're not human, right? 71 00:02:33,860 --> 00:02:36,980 We think of corporations as these shadowy big 72 00:02:36,980 --> 00:02:40,560 business type of type of situations where one, 73 00:02:40,620 --> 00:02:41,400 that's not always the case. 74 00:02:41,460 --> 00:02:43,240 There are investors that are small time investors 75 00:02:43,240 --> 00:02:44,920 who want to flip houses and whatnot. 76 00:02:45,200 --> 00:02:49,440 But also we're forgetting that corporations are also 77 00:02:49,440 --> 00:02:52,080 turning around and either renting this home to 78 00:02:52,080 --> 00:02:54,300 maybe a family who can't afford to buy 79 00:02:54,300 --> 00:02:56,680 a home or they're selling it to a 80 00:02:56,680 --> 00:02:57,120 family, right? 81 00:02:57,140 --> 00:02:59,100 It's not just because a corporation is buying 82 00:02:59,100 --> 00:03:00,900 it does not mean that it's not also 83 00:03:00,900 --> 00:03:02,660 your home is not also going to be 84 00:03:02,660 --> 00:03:05,720 someplace where people get to raise their kids 85 00:03:05,720 --> 00:03:07,460 and have important memories happen. 86 00:03:07,660 --> 00:03:09,940 So we that's the first problem is I 87 00:03:09,940 --> 00:03:12,300 think we're thinking of corporations is really bad 88 00:03:12,300 --> 00:03:14,760 here and we hear that and automatically our 89 00:03:14,760 --> 00:03:16,200 minds start saying this is bad. 90 00:03:16,380 --> 00:03:18,260 Let's protect, you know, the American family. 91 00:03:18,620 --> 00:03:19,900 But there's another part to this too. 92 00:03:19,900 --> 00:03:22,020 So your family is trying to sell their 93 00:03:22,020 --> 00:03:22,400 house. 94 00:03:22,540 --> 00:03:25,300 They've got these two entities they're choosing between, 95 00:03:25,520 --> 00:03:28,400 but the family can't really afford as much 96 00:03:28,400 --> 00:03:29,760 as the house is worth. 97 00:03:29,880 --> 00:03:32,700 But the corporation or the, you know, the 98 00:03:32,700 --> 00:03:34,540 investor, whether it's a big corporation or a 99 00:03:34,540 --> 00:03:37,200 small, small time investing firm, or even a 100 00:03:37,200 --> 00:03:40,460 person, uh, they're able to offer a lot 101 00:03:40,460 --> 00:03:42,320 more and your family's moving. 102 00:03:42,420 --> 00:03:43,540 They could use this money. 103 00:03:43,620 --> 00:03:46,160 Obviously when it comes down to certain things, 104 00:03:46,220 --> 00:03:47,700 making, making more money is good. 105 00:03:47,700 --> 00:03:49,780 So as the buyer, as the person who 106 00:03:49,780 --> 00:03:52,240 owns that property, because right now that's your 107 00:03:52,240 --> 00:03:54,840 family's home, they own it, they're paying the 108 00:03:54,840 --> 00:03:56,840 mortgage on it for them to have the 109 00:03:56,840 --> 00:03:59,220 option to make a lot more by selling 110 00:03:59,220 --> 00:04:00,120 it to an investor. 111 00:04:01,180 --> 00:04:03,680 That's that's a great opportunity for you. 112 00:04:03,780 --> 00:04:05,280 And maybe it's what you need to be 113 00:04:05,280 --> 00:04:07,220 able to pay off some debt and move 114 00:04:07,220 --> 00:04:07,900 into a new house. 115 00:04:07,920 --> 00:04:10,180 And so it's like the perfect solution for 116 00:04:10,180 --> 00:04:10,740 your family. 117 00:04:10,800 --> 00:04:12,020 It could really save you. 118 00:04:12,360 --> 00:04:14,640 And because you are the property owner, it 119 00:04:14,640 --> 00:04:17,260 is your right to choose who you sell 120 00:04:17,260 --> 00:04:18,060 your home to. 121 00:04:18,480 --> 00:04:21,180 So you go with the investor and everything 122 00:04:21,180 --> 00:04:22,280 turns out great. 123 00:04:24,060 --> 00:04:26,040 There's good scenarios to this. 124 00:04:26,520 --> 00:04:27,780 Let's say you live in a home that 125 00:04:27,780 --> 00:04:29,940 you put on the market that no individual 126 00:04:29,940 --> 00:04:30,980 families are looking at. 127 00:04:31,040 --> 00:04:32,400 Maybe it's in a bad area. 128 00:04:32,480 --> 00:04:34,200 Maybe it's in an area that is going 129 00:04:34,200 --> 00:04:35,500 to be re-gentrified soon. 130 00:04:35,620 --> 00:04:36,760 Like it's going to have a, it's like 131 00:04:36,760 --> 00:04:39,520 not great right now, but younger people are 132 00:04:39,520 --> 00:04:40,980 moving in and trying to clean up the 133 00:04:40,980 --> 00:04:41,380 neighborhood. 134 00:04:41,660 --> 00:04:43,740 So right now there's no appeal, but there 135 00:04:43,740 --> 00:04:45,640 might be later and you would like to 136 00:04:45,640 --> 00:04:47,480 move, but nobody's coming to look at your 137 00:04:47,480 --> 00:04:50,160 house and an investor comes and finally is 138 00:04:50,160 --> 00:04:51,460 like, we will pay you this much for 139 00:04:51,460 --> 00:04:53,000 your house because we want to develop new 140 00:04:53,000 --> 00:04:54,840 houses here, whatever it may be. 141 00:04:54,980 --> 00:04:56,560 That's a great opportunity for you. 142 00:04:56,680 --> 00:04:58,320 And as the property owner, you should be 143 00:04:58,320 --> 00:05:00,000 allowed to sell to whoever you want, to 144 00:05:00,000 --> 00:05:00,680 whomever you want. 145 00:05:01,740 --> 00:05:03,240 And that's going to do a lot for 146 00:05:03,240 --> 00:05:03,440 you. 147 00:05:03,480 --> 00:05:04,860 That's going to help you get ahead in 148 00:05:04,860 --> 00:05:05,020 life. 149 00:05:05,080 --> 00:05:06,860 And so I'm focusing now on the buyer 150 00:05:06,860 --> 00:05:08,260 part of it or the seller part of 151 00:05:08,260 --> 00:05:08,940 it, excuse me. 152 00:05:09,140 --> 00:05:12,160 But that's very, very important that you are 153 00:05:12,160 --> 00:05:14,800 able as an individual property owner to sell 154 00:05:14,800 --> 00:05:17,140 your property to whomever you want. 155 00:05:17,600 --> 00:05:18,620 That is economic Liberty. 156 00:05:18,820 --> 00:05:21,140 That is a property rights that should be 157 00:05:21,140 --> 00:05:22,040 allowed to happen. 158 00:05:22,620 --> 00:05:24,660 Now if there are bans placed on, on 159 00:05:24,660 --> 00:05:27,820 corporations buying homes, that's not even just a 160 00:05:27,820 --> 00:05:28,960 ban on the corporations. 161 00:05:29,180 --> 00:05:30,540 That's a ban on you. 162 00:05:30,640 --> 00:05:32,320 That's a ban on the property owner. 163 00:05:32,440 --> 00:05:34,900 So that's not a win for individual Liberty. 164 00:05:35,100 --> 00:05:38,060 Even if you don't like the idea of 165 00:05:38,060 --> 00:05:40,720 investors buying home, I mean as the property 166 00:05:40,720 --> 00:05:42,200 owner, you might say, I don't want more 167 00:05:42,200 --> 00:05:42,420 money. 168 00:05:42,420 --> 00:05:43,720 I would rather sell to a family and 169 00:05:43,720 --> 00:05:45,680 you have that right because it's your property. 170 00:05:45,860 --> 00:05:48,860 And so this ban isn't just punishing big 171 00:05:48,860 --> 00:05:50,500 corporations who will probably fine. 172 00:05:51,360 --> 00:05:53,800 It's hurting the property owner by telling them 173 00:05:53,800 --> 00:05:55,400 who they can do business with, and that's 174 00:05:55,400 --> 00:05:55,920 not okay. 175 00:05:56,360 --> 00:05:57,900 Now let's talk about before we get into 176 00:05:57,900 --> 00:06:00,240 how this is bad for people who, who 177 00:06:00,240 --> 00:06:01,240 need housing. 178 00:06:01,240 --> 00:06:03,580 Let's talk about why people don't like the 179 00:06:03,580 --> 00:06:06,040 idea of investors buying a properties. 180 00:06:06,060 --> 00:06:08,640 For one, you know, they're scared that these 181 00:06:08,640 --> 00:06:11,280 investors have more money and can outbid people 182 00:06:11,280 --> 00:06:13,200 who, you know, families that want to buy 183 00:06:13,200 --> 00:06:13,520 homes. 184 00:06:13,660 --> 00:06:14,980 And so that is a little bit scary 185 00:06:14,980 --> 00:06:16,560 to people who really want to see families 186 00:06:16,560 --> 00:06:18,180 have the opportunity at home ownership. 187 00:06:18,500 --> 00:06:21,780 Then there's another concern of people, of these 188 00:06:21,780 --> 00:06:24,260 investors coming in, buying the property and then 189 00:06:24,260 --> 00:06:27,500 making the entire neighborhood rentals and property owners 190 00:06:27,500 --> 00:06:29,080 who own their homes don't like that because 191 00:06:29,080 --> 00:06:31,040 that could cause the value of their homes 192 00:06:31,040 --> 00:06:31,660 to go down. 193 00:06:32,100 --> 00:06:35,380 And there's also this idea that people demonize 194 00:06:35,380 --> 00:06:38,420 renting a home, forgetting that not everybody wants 195 00:06:38,420 --> 00:06:40,320 to own a home, that it is something 196 00:06:40,320 --> 00:06:41,580 that you have to choose to do. 197 00:06:41,780 --> 00:06:43,900 It is something that more and more people 198 00:06:43,900 --> 00:06:45,020 are not able to do. 199 00:06:45,080 --> 00:06:46,740 And whether that's because the economy is bad 200 00:06:46,740 --> 00:06:49,000 or because they just have other preferences. 201 00:06:49,140 --> 00:06:50,580 A lot of people like to be nomads. 202 00:06:50,640 --> 00:06:51,640 They don't want to own a home. 203 00:06:52,060 --> 00:06:53,620 Some people don't want to have to deal 204 00:06:53,620 --> 00:06:54,320 with their own repairs. 205 00:06:54,460 --> 00:06:56,680 There are numerous reasons people might want rentals. 206 00:06:57,040 --> 00:06:58,920 And another big reason is some people just 207 00:06:58,920 --> 00:07:01,200 simply, again, can't afford to buy a home. 208 00:07:01,300 --> 00:07:03,420 And so having an opportunity, a good rental, 209 00:07:03,460 --> 00:07:05,660 not just like a small crummy rental is 210 00:07:05,660 --> 00:07:07,200 a really good opportunity for them. 211 00:07:07,740 --> 00:07:10,700 So there's all this fuss right now about, 212 00:07:10,940 --> 00:07:14,140 again, corporations owning so many homes and they're 213 00:07:14,140 --> 00:07:15,800 going to, you know, they're maybe they'll jack 214 00:07:15,800 --> 00:07:17,940 up rent and just they're hurting the little 215 00:07:17,940 --> 00:07:18,160 guy. 216 00:07:18,260 --> 00:07:19,920 That's what you always hear when you hear 217 00:07:19,920 --> 00:07:21,360 the word corporation investors are going to hurt 218 00:07:21,360 --> 00:07:21,900 the little guy. 219 00:07:22,040 --> 00:07:22,820 But here's the thing. 220 00:07:22,920 --> 00:07:25,220 Reason Magazine, they dug into this a little 221 00:07:25,220 --> 00:07:27,340 bit and they found out that large, like 222 00:07:27,340 --> 00:07:30,680 institutional, these big corporation, the investors only own 223 00:07:30,680 --> 00:07:32,340 like I think it was something like three 224 00:07:32,340 --> 00:07:34,320 percent of what they call the single family 225 00:07:34,320 --> 00:07:34,600 home. 226 00:07:34,600 --> 00:07:36,200 So not apartment buildings, but the homes where 227 00:07:36,200 --> 00:07:36,880 a family will live. 228 00:07:36,960 --> 00:07:38,660 They only own three percent. 229 00:07:38,860 --> 00:07:41,700 That is a very small number. 230 00:07:41,760 --> 00:07:44,320 So even generally speaking, even if you don't 231 00:07:44,320 --> 00:07:45,860 want to get into the nitty gritty of 232 00:07:45,860 --> 00:07:49,840 what this means for buyers and sellers, three 233 00:07:49,840 --> 00:07:51,320 percent is a small enough number where you 234 00:07:51,320 --> 00:07:53,120 have to wonder is this even a big 235 00:07:53,120 --> 00:07:55,760 enough deal that they're saying it is. 236 00:07:55,800 --> 00:07:57,660 Is this really contributing to a big problem? 237 00:07:58,120 --> 00:08:00,280 One thing we know for absolute sure is 238 00:08:00,280 --> 00:08:01,860 that our country is in the midst of 239 00:08:01,860 --> 00:08:03,480 a really bad housing shortage right now. 240 00:08:03,480 --> 00:08:06,460 There are not enough housing opportunities or affordable 241 00:08:06,460 --> 00:08:09,600 housing opportunities for the people who need them. 242 00:08:09,660 --> 00:08:11,460 And that is creating a problem. 243 00:08:11,580 --> 00:08:15,640 But blaming it all on investors because they're 244 00:08:15,640 --> 00:08:18,040 buying homes and not living in them is 245 00:08:18,040 --> 00:08:21,060 is one placing way too much blame on 246 00:08:21,060 --> 00:08:22,540 a problem that, as we said, was a 247 00:08:22,540 --> 00:08:24,400 three percent number is very, very small. 248 00:08:24,740 --> 00:08:27,380 It neglects the fact that when the investors 249 00:08:27,380 --> 00:08:29,180 are buying these homes, they do have more 250 00:08:29,180 --> 00:08:31,520 power to fix them up and flip them 251 00:08:31,520 --> 00:08:32,280 and rent them out. 252 00:08:32,280 --> 00:08:36,159 And so they are actually contributing to to 253 00:08:36,159 --> 00:08:38,460 more housing on the market, which is actually 254 00:08:38,460 --> 00:08:39,679 helping to fix the problem. 255 00:08:39,820 --> 00:08:43,059 But it's also ignoring the many other housing 256 00:08:43,059 --> 00:08:44,400 issues that we have in this country. 257 00:08:44,640 --> 00:08:46,440 I think one of the biggest ones being 258 00:08:46,440 --> 00:08:48,420 that there are so many hurdles, so many 259 00:08:48,420 --> 00:08:50,900 barriers to actually being able to build a 260 00:08:50,900 --> 00:08:52,720 home because there are zoning laws and permit 261 00:08:52,720 --> 00:08:53,900 laws and licensing laws. 262 00:08:53,900 --> 00:08:55,520 And these things add up very quickly. 263 00:08:55,520 --> 00:08:57,600 And it's making it harder for people who 264 00:08:57,600 --> 00:08:59,320 want to build more homes to build them. 265 00:08:59,680 --> 00:09:00,800 And that's a government problem. 266 00:09:00,800 --> 00:09:02,400 That's a problem where we need government to 267 00:09:02,400 --> 00:09:04,100 to put their hands up and say, we 268 00:09:04,100 --> 00:09:04,900 don't want to do this anymore. 269 00:09:05,000 --> 00:09:07,140 We don't want to force people to do 270 00:09:07,140 --> 00:09:07,320 this. 271 00:09:07,400 --> 00:09:10,960 So there's so many other problems involved in 272 00:09:10,960 --> 00:09:12,980 the housing problem that blaming it all here 273 00:09:12,980 --> 00:09:15,080 is just kind of ridiculous. 274 00:09:15,380 --> 00:09:18,340 And it's also harming those that it's protecting, 275 00:09:18,500 --> 00:09:19,680 that it's claiming to protect. 276 00:09:19,820 --> 00:09:21,840 And what I mean by that is there 277 00:09:21,840 --> 00:09:23,540 are a lot of people who can't afford 278 00:09:23,540 --> 00:09:25,060 to buy homes and they need homes that 279 00:09:25,060 --> 00:09:25,600 they can rent. 280 00:09:25,600 --> 00:09:29,220 They need affordable homes that that that are 281 00:09:29,220 --> 00:09:30,400 accessible to them. 282 00:09:30,460 --> 00:09:32,700 And when you're telling investors not to buy 283 00:09:32,700 --> 00:09:34,280 these homes and rent them out, you're taking 284 00:09:34,280 --> 00:09:37,300 away opportunities from people who who aren't looking 285 00:09:37,300 --> 00:09:38,060 to buy a home. 286 00:09:38,380 --> 00:09:39,960 We need options for everybody. 287 00:09:40,260 --> 00:09:42,200 And the best way to do that, the 288 00:09:42,200 --> 00:09:44,020 best way to make sure that needs are 289 00:09:44,020 --> 00:09:45,960 met is to make sure that individuals have 290 00:09:45,960 --> 00:09:48,600 the choice, the freedom to choose who to 291 00:09:48,600 --> 00:09:50,340 buy to who to sell from, who to 292 00:09:50,340 --> 00:09:53,920 who to buy from, who to sell to. 293 00:09:53,920 --> 00:09:57,160 I got my prepositions wrong and making sure 294 00:09:57,160 --> 00:10:01,000 that the market is responsible for these interactions 295 00:10:01,000 --> 00:10:02,960 and not the government telling you what you 296 00:10:02,960 --> 00:10:03,400 can do. 297 00:10:03,520 --> 00:10:05,140 And so that is the big takeaway in 298 00:10:05,140 --> 00:10:06,780 almost everything we talk about, right? 299 00:10:06,900 --> 00:10:09,100 The government does not and should not play 300 00:10:09,100 --> 00:10:09,700 a role here. 301 00:10:09,800 --> 00:10:12,120 It should be between buyers and consumers, whether 302 00:10:12,120 --> 00:10:14,560 that be a family selling a house or 303 00:10:14,560 --> 00:10:17,100 a corporation selling a house, whatever it may 304 00:10:17,100 --> 00:10:17,440 be. 305 00:10:17,720 --> 00:10:20,240 So when you're hearing this this narrative in 306 00:10:20,240 --> 00:10:22,000 the news about how this is such a 307 00:10:22,000 --> 00:10:23,920 big problem, really stop and think about it 308 00:10:23,920 --> 00:10:25,440 and say, is this a big problem? 309 00:10:25,660 --> 00:10:28,040 And what would more laws, what would creating 310 00:10:28,040 --> 00:10:30,820 policy do to harm individualism and individual liberty? 311 00:10:31,240 --> 00:10:32,300 We will leave it there. 312 00:10:32,380 --> 00:10:34,100 As always, don't forget to like and subscribe 313 00:10:34,100 --> 00:10:34,760 to the podcast. 314 00:10:35,020 --> 00:10:36,440 And until next time, I will talk to 315 00:10:36,440 --> 00:10:36,740 you later.