In Venezuela, Sell Your House or Lose It

[MADem]

...Consider a new law that forces homeowners to sell their rental units to tenants. As of Monday, anyone who owns three or more properties and has rented a unit for more than 20 years, must sell it at a “fair price” to be determined by the state. Landlords who fail to do so face fines and could lose their homes.

The government blames a “monopoly on housing” for Venezuela’s housing shortage. But forcing landlords to sell to tenants can’t possibly solve homelessness. Plus, renters who can’t buy their home may be pushed out by those who can. In the best of all outcomes, this new policy promoted by the government of President Nicolas Maduro would leave the housing problem unchanged. It's much more likely that it will aggravate the housing shortage it is designed to ease.

Venezuela’s housing shortage has doubled to 3 million homes during the past 15 years since now-deceased President Hugo Chavez came to power and adopted policies that mandated wealth redistribution. The housing deficit is growing by 130,000 units every year, which shows that existing policies, including price controls, that limit investor returns have been a drag on residential construction.

It’s easy to imagine things getting worse. Residential buildings older than 20 years, and any others approaching that age, will immediately lose value because real estate investors will get stuck with losses or won't be able to make an adequate return. And why would anyone invest in building new homes in a country where the state already sets rental rates and decrees when and at what prices they must be sold? .... Maduro’s administration says it now aims to build 3 million new homes by 2019. But plenty of red tape, corruption and the absence of adequate construction incentives will make it another failed promise. His attack on real estate investors may be meant to hurt those he deems “savage capitalists.” But it will only squeeze the remaining members of Venezuela’s middle class who haven’t already fled the country and will create a bigger housing shortage. ....

http://www.bloombergview.com/articles/2014-04-02/in-venezuela-sell-your-house-or-lose-it

[Bacchus4.0]

1. another in the long list of failures of the chavista government n/t

[tech3149]

2. When your fighting for the poor

and against so many well-heeled opposition forces, I guess it's not that hard to fail, if that is true. A few more million $ a year to USAID should put that last nail in the coffin. In ANOTHER THIRTY YEARS. It's worked out so well against Cuba.
When is this country going to start learning that pissing in other peoples sandboxes doesn't get you anywhere but behind?

Seriously Bacchus, I think you need to get out more!

[Marksman_91]

3. Most, if not all, LatinAmerican countries aren't following the same policies as the Ven. government

and they all seem to be doing better than Venezuela. So far the results of the government's new laws and handling of the economy have only been poor. Ask anybody well-versed in economics, and most will tell you that the PSUV is leading the country to the brink of ruin, sustained only by the bonanza gained from the US (ironically) buying Venezuelan oil. You're naive when you think all these laws are about the government fighting for the poor, when it's all really about them seizing as much control as they can so nobody can truly challenge them and oust them out of power, simply because if they ever lose their political immunity, they would be sentenced the next day for god knows how many years. It doesn't take much to notice that all the big officials have made themselves obscenely rich since they came into power, subtly siphoning themselves millions through all those ridiculous currency exchange control institutions that no other Latin American country has had the need to implement for some reason, and they apparently don't have all the problems that Venezuela has, such as out-of-control crime rate, an annual inflation rate of over 50%, people having to do lines that last hours to buy foodstuffs that they probably won't even get to buy since there's not enough of it, and so on. To think that all these problems are caused by some outside entity when the government itself has most of the control in terms of national production, transportation, security and so on, especially when there's no solid proof to show it, is completely absurd.

[Bacchus4.0]

9. +1 n/t

[Flatulo]

4. How is it, exactly, do you believe that the USA

is causing or exacerbating this housing crisis? Venezuela has more oil than Saudi Arabia, and a government that is committed to fighting for the poor by building millions of housing units. So specifically, what is the USA doing to cause homelessness in Venezuela?

[Bacchus4.0]

10. I get out quite a bit, particularly to Latin America. I noticed that chavistas here don't get out

at all. They are not fighting for the poor, just for themselves.

[joshcryer]

5. I wonder how many boligarchs will have to sell?

[MADem]

6. They'll probably sell to one another, and then buy back!

You know they'll game the system.

I don't see how Maduro thinks poor people paying rent can come up with the means to qualify for mortages in this economy. He's just a moron. This is a stupid idea.

[joshcryer]

7. They probably won't even be scrutinized.

The idea that there are many lower level landlords in Venezuela is a joke. The main rental properties are fucking vacation spots for yuppies who want to come see the revolution in action or something.

Of course, Venezuela, unlike practically every other South American state, doesn't release the statistics for rentals vs ownership and whatnot. Because the revolution is an absolute failure. Mind you, they are probably collecting the data, it is important for social development, but I have to wonder what the people behind the scenes are thinking, as the figures are worse and worse. It's like the murder rate, keep it secret.

[MADem]

8. +1,000 nt

[RobertEarl]

11. That is a good idea

Home ownership makes for a much more stable community.

Landlords are in it just for capital reasons. All they care about is making a buck. A home owner actually makes for better communities.

It is amazing how progressive the Venezuelans are becoming.

[MADem]

12. Hilarious!

The people living in the homes can't afford to buy them.

The landlords are forced to sell or be fined, but they can't find anyone with money to buy the houses.

Yeah, a real "progressive" idea to force people to do what the Big Government wants with their own property.

Your car is too nice--"We, the People" think you need to get rid of it and ride a bike instead.

It's for your Own Good, of course.

[FrodosPet]

13. What about the Ven. government buying and maintaining them?

And providing them to people for free?

The government can set the price: Pay the landlords Bs.F. 500 and jail anyone who refuses to sell.

[MADem]

14. They don't have a pot to piss in or a window to throw it out of....

They aren't paying their BILLS. VZ has serious cash flow problems, they've borrowed billions from China, and no one will extend them any credit any more because they just aren't paying their notes like they should. Look at the mess with the airlines; they had to stop flying in before VZ said they'd make good on what they owed.

They aren't going to run round buying up homes at fair or even sub-par prices. The scheme is to (supposedly) allow (or force, even if they don't want to) the renters to buy; it's more about shaking loose "fine money" (if you don't comply, you pay the fine) from the landlords.

This isn't doing anything to free up housing for people who need it. VZ is sitting on enormous oil wealth; instead of using that money to build public housing, the money is skimmed off by the Boligarchs....which is why Mrs. Maduro owns a million dollar home in FL (irony--that's where an enormous chunk of the VZ middle class has fled), and her kids run a family owned Japanese restaurant there. She's trying to unload the thing since people figured out it was hers; she's lowered the asking price from a million four to just under nine fifty.

And "regular" Venezuelans have currency limitations placed upon them when they travel, worse if they travel to "enemy territory" in FL.

Do as I say, not as I do, I guess.

[RobertEarl]

15. Hilarious!

First you complain about socialism attempting to make it easier for people to own their own homes so they can be in the market.

Then you complain about someone using the capitalist real estate market to increase their capital.

Hilarious!!

[MADem]

16. What Maduro is doing is not "socialism"--no wonder you find him "hilarious!"

No one is going to buy homes under this new plan. Inflation isn't mitigated, savings aren't magically created, cash for lending isn't magically created.

It's a money making scheme, a sop, a distraction. Don't look at the poor leadership, look over here, instead!

[RobertEarl]

17. It is not Maduro who is hilarious

Home ownership is a good idea. One can invest in a home and make a capital gain and become an established part of a community.

Instead of capital going to a landlord who may live in the US, the money will stay in Venezuela and benefit the community. Only those opposed to stability and the chance for poor people to own their own home would be opposed.

I can see why landlords in the US would be opposed.

[Marksman_91]

18. You REALLY have no idea how economies work, do you? n/t

[MADem]

19. How can you invest in a home when inflation is rampant and there's no money supply available?

Maduro can't wave a magic wand and fix that little problem with a decree like this.

The money--such as it is, and it's pretty well worthless--isn't going to USA. The money has little to no value outside the nation, because of the phony exchange rate, never mind the disastrous black market rate which makes the currency cheaper to use than toilet paper.

No one is buying a home with this silliness. It's a bluster.