Capitalism & The Housing Crisis, Part 7: NIMBYs
Capitalism pits working-class homeowners against working-class renters. The system is designed to force one side to lose.
If the housing crisis was solved, not everyone would rejoice. Among those shedding tears would be housing developers, landlords, and bankers. But it wouldn’t just be those at the top of the economic pyramid.
When home prices go down, the wealth of home owners goes down, too. And for most home owners, the wealth in their home is the vast majority of what they have, or even every last bit of it. Most homeowners aren’t rich, and a surprisingly large number of them are actually working-class.
When I was doing research for this series, I was surprised by how high the rates of home ownership are. According to OECD, the home ownership rate in the United States is 64%; in Canada it’s 67%. And it’s also high in a lot of countries with much lower per capita incomes.
Now, a quick clarification before anyone gets confused: a homeownership rate of 64% doesn’t mean that 64% of individual humans own a home. It means 64% of homes are owned by someone who lives there. In other words, in 64% of households, the home is owned by a member of the household. That includes people still paying off their mortgage. And, to be clear, we’re counting homes, not houses. So if you rent the basement of a house, and the homeowner, your landlord, lives upstairs, you’re counted as two separate households — the landlord as a homeowner household, and you as a household that rents.
Anyways, like I was saying, the rates of home ownership are higher than I expected.
- In the European Union, the home ownership rate is 68%
- In OECD countries, the home ownership rate is 71%.
- And the website World Population Review shows homeownership rates for 74 countries, on every continent except the penguin continent of Antarctica. As for everywhere else, home ownership rates are above 50% in nearly every country on that list — 69 of them. Nice. Only five countries on the list have home ownership rates under 50%, and only ten of the countries have ownership rates under 60%.
Oh, and if you’re wondering, I checked the data, and the rate of home ownership among Antarctic penguins is 0%, but the rate of living in a big anarchist commune is 100%. Good job, comrades.
So, home ownership is quite widespread throughout the population, and even throughout the working-class. And this brings us to the NIMBYs. NIMBY is an acronym for “Not In My Back Yard.” Jack be NIMBY, Jack be quick, Jack says renters can suck my dick.
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In the context of the housing crisis, NIMBYs are the homeowners who don’t want new housing built in their neighborhood. And so, NIMBYs are one of the obstacles blocking the housing supply from being expanded, or slowing down that expansion. They organize petition drives, pack public meetings, and lobby city hall to block changes to local zoning laws that would allow denser housing built near where they live, or deny requests for exceptions to those zoning laws.
Now, I don’t want dismiss the impact of this. NIMBYs are one of the factors restricting the supply of housing, and therefore pushing up the price of housing. That’s real. But, let’s consider the system that they’re operating in, and how this drives their NIMBY behavior.
We often picture NIMBYs as cartoonishly evil retirees yelling at a city councilor in a public meeting cuz a new apartment building might block their view of their favorite billboard. But why are NIMBYs so fiercely, aggressively paranoid about any new housing getting built nearby?
Maybe it has something to do with the fact that for most homeowners, their house isn’t just a place to live. It’s literally their life savings, their retirement plan, and their emergency medical fund, all wrapped into four walls and a roof. If new housing gets built nearby and property values go down, these families lose wealth they were relying on to survive during old age.
And within a capitalist system, if housing prices went down as much as they need to go down to make both buying and renting homes way more affordable for way more people, this could leave homeowners with what’s called an “underwater mortgage.”
Say you owe $600,000 in mortgage debt on a house that is now only worth half that much. That’s an underwater mortgage — and you’re drowning.
Meanwhile, the financial sharks are circling your living room, because underwater mortgages put people at greater risk of defaulting on their loan, and having their home foreclosed by the bank, thereby losing everything. This happened after the 2008 financial crash — an epidemic of underwater mortgages and foreclosures — and this crash in US real estate spiraled into an international Great Recession.
And no, when the bank takes your home away in a foreclosure, it doesn’t pay you back the money you paid on your mortgage all those years. Doesn’t matter how many hundreds of thousands of dollars you paid. That money, and your home, now belong to the bank, leaving you with nothing.
So this is the dilemma capitalism gives us: Option A: millions of people crushed by brutally high rent, with some even pushed into homelessness. Or Option B: millions of people financially ruined, losing the wealth they need for security during old age, and even in some cases losing their home.
There’s something truly sick about a system that forces this “choice” on us. This is a system that’s designed to turn us against each other, working-class and middle-class homeowners pitted against working-class and middle-class renters. What’s clear is that we’re all getting screwed by this class system which has put us in this situation to begin with.
It’s damned if you do, damned if you don’t. Whichever you choose, someone’s gonna lose. And though bringing home prices down is necessary, and is the lesser evil in this scenario, the fact is that in capitalism, this can’t be done without innocent victims.
So, we’re damned if we do, and damned if we don’t. The only way out is to overthrow the damn system.
(This series will be fast-coming because I already wrote the whole thing, and could post it all right now if not for Medium’s limit on how many articles you can publish per day. So keep an eye out each day for new posts!)
𝖸𝗈𝗎 𝖼𝖺𝗇 𝗁𝖾𝗅𝗉 𝗌𝗉𝗋𝖾𝖺𝖽 𝗍𝗁𝖾 𝗋𝖾𝗏𝗈𝗅𝗎𝗍𝗂𝗈𝗇𝖺𝗋𝗒 𝗐𝗈𝗋𝖽 𝖻𝗒 𝗌𝗁𝖺𝗋𝗂𝗇𝗀 𝗍𝗁𝗂𝗌 𝗉𝗈𝗌𝗍 𝗈𝗋 𝗍𝖾𝗅𝗅𝗂𝗇𝗀 𝗉𝖾𝗈𝗉𝗅𝖾 𝖺𝖻𝗈𝗎𝗍 𝗆𝗒 𝖻𝗅𝗈𝗀.
𝖬𝗒 𝗐𝗋𝗂𝗍𝗂𝗇𝗀 𝗂𝗌 𝖿𝗋𝖾𝖾. 𝖬𝗎𝖼𝗁 𝖺𝗉𝗉𝗋𝖾𝖼𝗂𝖺𝗍𝗂𝗈𝗇 𝗂𝖿 𝗒𝗈𝗎 𝖼𝖺𝗇 𝗌𝗎𝗉𝗉𝗈𝗋𝗍 𝗆𝖾 𝗈𝗇 𝖯𝖺𝗍𝗋𝖾𝗈𝗇 𝗈𝗋 𝗀𝗂𝗏𝖾 𝖺 𝗈𝗇𝖾 𝗍𝗂𝗆𝖾 𝖽𝗈𝗇𝖺𝗍𝗂𝗈𝗇 𝗈𝗇 𝖯𝖺𝗒𝖯𝖺𝗅.
𝖨𝖿 𝗒𝗈𝗎’𝖽 𝗅𝗂𝗄𝖾 𝗍𝗈 𝗐𝖺𝗍𝖼𝗁 𝗆𝗒 𝗏𝗂𝖽𝖾𝗈𝗌, 𝗁𝖾𝗋𝖾’𝗌 𝗆𝗒 𝗒𝗈𝗎𝗍𝗎𝖻𝖾 𝖼𝗁𝖺𝗇𝗇𝖾𝗅.
𝖳𝗁𝖺𝗇𝗄𝗌 𝖿𝗈𝗋 𝖻𝖾𝗂𝗇𝗀 𝗁𝖾𝗋𝖾! 𝖠𝗇𝖽 𝗉𝗅𝖾𝖺𝗌𝖾 𝗋𝖾𝗆𝖾𝗆𝖻𝖾𝗋 𝗍𝗈 𝗅𝗈𝗏𝖾 𝗒𝗈𝗎𝗋𝗌𝖾𝗅𝖿 𝖺𝗇𝖽 𝖾𝖺𝖼𝗁 𝗈𝗍𝗁𝖾𝗋.
