/biz/ - Business & Finance

Do unregulated renting destroys the economy?

It seems that rent cause a massive strain on the economy and such up all the growth by causing essentially taxation.

Any time workers get a raise, the landlords raise the rents to get the money for themselves.

Any time bussinesses create more value, the landlors raise their rents, to get as much share as possible.

This causes an endless cycle where everything gets more and more expensive so that businesses can pay their rents, people asking for higher and higher wages to pay their rents and buy the even more expensive goods and services, while all the extra money ends up in landlords' pockets, who don't need to create any extra value to justify the increased rents.

Creating more real estate is often not possible and the owners are often perfectly happy to leave buildings empty so that they can keep the rents high.

This is eventually followed by people leaving the city as it is no longer profitable to stay in the city and the city's real estate market collapses as everybody goes either bankrupt or moves elsewhere.

Is there a solution to this problem? How could we create real estate market which is not prone to price gouging and bubbles?

It seems that rent cause a massive strain on the economy and such up all the growth by causing essentially taxation.

Any time workers get a raise, the landlords raise the rents to get the money for themselves.

Any time bussinesses create more value, the landlors raise their rents, to get as much share as possible.

This causes an endless cycle where everything gets more and more expensive so that businesses can pay their rents, people asking for higher and higher wages to pay their rents and buy the even more expensive goods and services as all the extra money ends up in landlord's pocket, who don't create any extra value. Creating more real estate is often not possible and the owners are often perfectly happy to leave buildings empty so that they can keep the rents high.

This is often followed by people leaving the city en masse as it is no longer profitable to stay in the city and the city colalpses as everybody goes either bankrupt or moves elsewhere and the real estate market crashes.

Is there a solution to this problem? How could we create real estate market which is not prone to price gouging and bubbles?