Lobbying and Revolving Door Politics

 

In 2021, Biden signed Executive Order 13989, which had several protections against harmful lobbying and revolving door practices. This was rescinded under the current administration. The order was a major step toward getting money out of politics.

Industries where a lack of regulation in this area can be detrimental include pharmaceuticals, defense, finance, healthcare, and real estate. People shouldn't want personal and financial ties interfering with economic efficiencies in these areas.

One example where excessive lobbying can be problematic is how the NAR is lobbying to increase exclusions on capital gains taxes on residential real estate. This results in more inflated home prices. Also, the more the price of housing is inflated, the more realtors make on sales commissions (given equal turnover).

The ways revolving door politics work are a member of congress (or associate) or government employee may leave that position and end up with a lucrative corporate (including boards) or lobbying position, and vice versa. This is widely considered to be a conflict of interest.

Spending on lobbying by organizations should be limited to 1,000,000. This would eliminate much of the unethical behavior and open up congress to receiving feedback and suggestions from smaller entities. With politics there's the votes, campaign spending and lobbying. Getting things away from spending on campaigns and lobbying, and toward individual votes would work better.

Private Equity and Affordable Housing

 

Private equity, as well as other institutional investors (to a lesser extent), don't actually own that much of the single family rental supply (estimates range from 3-4%). In some Sun Belt markets, estimates range from 10-20%.

A concerning issue is where private equity is buying up mobile home parks. This is a gross example of predatory investing. Recently, all institutional investors accounted for about 1/4 of all mobile home park purchases.

I guess the typical scenario is where investors buy up the properties, then raise the rents for the lots, maybe several times over a period of years, then sell the properties for a profit. Mobile homes are very expensive to relocate, so the owners don't really have options. 

About half of these are financed through government-backed programs. So, one way to remedy this would be to prohibit that. Or, just make it illegal for institutional investors to invest in this type of real estate.

Urban Planning

There's a lot of inefficiencies with historical urban planning. This isn't the 50's, a typical household doesn't have money for two cars. Developing cities with progressive features can better accommodate people dealing with today's issues.

Urban density makes public transportation feasible, while giving people other options such as walking and biking. Mixed use zoning is a big plus, reducing commute distances. Minimum parking requirements and excessive parking lot sizes are big negatives.

If a city can be developed so people don't need half the number of privately owned vehicles, this has all kinds of benefits. The cost of a second car means the price of the vehicle, maintenance, repairs, fuel, and insurance. A family with a median income or lower simply can't afford this anymore.

Just looking at parking spaces, they can be an enormous waste of space. Parking areas mean farther commute distances. They take up all kinds of property, thereby driving up land costs, as well as the costs of goods and services. Longer commutes mean more wear and tear on vehicles, as well as more fuel and repairs. Also, more infrastructure costs as roads are needed to cover the extra distances.