A Boring Dystopia

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1971

Fucking leeches (lemmy.dbzer0.com)

submitted 1 day ago by [email protected] to c/[email protected]

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[–] [email protected] 8 points 1 day ago (1 children)

Fwiw, while this would be a disincentive, the 'real' money from this is the ability to leverage at a high amount.

If you mortgage a property you effectively get to leverage your capital 5:1, and your return is made by someone else paying the interest on your margin, any below the line profit is a bonus.

So if it's costing my business $100 month (mortgage, losses) and the tenant is paying $100 (rent, profits), your net profit is 0 but you are effectively earning $80 on that $100.

So you would need to also reclassify what it means to be a real estate professional, to prevent business from being able to claim real estate expenses as a loss. (As well as the tons of other aspects like depreciation which give you time value of money over the life of the property, depreciation of assets within the house, and other tax benefits.) in fact it's possible to take a 'loss' on a house and rent it for less than your mortgage, and still come away making money

Just sayin there is more to it than just black and white P/L

[–] [email protected] 3 points 1 day ago (1 children)

Verbage:

Profit: An advantageous gain or return; benefit.

I was using the more common definition of the word, not the annoying accountant one.

Accountant profit: Financial gain from a transaction or from a period of investment or business activity, usually calculated as income in excess of costs or as the final value of an asset in excess of its initial value.

Of course the laws will have to be written in such a way that removes the ability of leeches to make financial gains on the back of other people.

[–] [email protected] 3 points 1 day ago (1 children)

100 in rent - 100 in mortgage cost = 0.

The gains are by the inherent value of the asset. You would need to tax the sale of the property because that is where the profit is realized.

My point isn't about a semantic difference in the definition of a word. It's that blanket policy that isn't well thought out doesn't actually solve any problems, it's helpful to take some time to actually think things through, get a better understanding of what is at play and come up with real ideas that can be actioned if you want change.

[–] Samskara 1 points 1 day ago

100 in rent - 100 in mortgage cost = 0.

There's also building upkeep insurance and taxes to pay.