Because it would make houses an unattractive investment. Once you get rid of the cheap leverage, housing will never compete with other investments. You always need to pay for like 40% of the house to start a mortgage anyway, this will not change the fact you need a significant savings before you can buy a house.
As another sibling said it's fairly usual in the US for put down between 3.5%-5% for a house. Additionally, There are a ton of assistance programs for low-income people to get cash grants or loan assistance.
If the only way to purchase a home was with cash I suspect that nearly every home would be owned by a real estate investment company. Who else would have the cash to purchase a home? You already are seeing this happen on the west coast. I'm very skeptical that consolidating ownership of land into even larger businesses would be accompanied by fair and equitable renter's rights. I believe that the entire stock of housing in cities being owned by large, far away entities would have a negative impact on living standards and mobility.
why would having large commercial landlords be any different than individual landlords?
I'd say that a big commercial landlord has some edge over an individual landlord by being able to operate at scale, and thus lower the cost of maintenance. This would be reflected as lowered rents.
Because large commercial interests have increased power in city, state and national politics. Rent control? Screw it! Background checks for rental units? Mandatory. If there is a monopoly on housing there's the potential for some pretty nasty stuff.
>You always need to pay for like 40% of the house to start a mortgage anyway
in the united states, literally the exact opposite is true. you can get a mortgage with almost nothing as a down payment. By agreeing to take on PMI, private mortgage insurance, you can get federal loans with something like a 3-3.5% down payment
>You always need to pay for like 40% of the house to start a mortgage anyway
What does this mean exactly? Even these days (i.e. post-2008), you can get a loan on a primary residence with 3% down. Closing costs are comparatively minimal. Where does the other 37% come from?
