But once they get there, can you trust them anymore? They’d be in power AND intelligent: lethal combination!

However, I’d pay higher taxes if Yves, Sester and some of the commenters here could run the Fed. Hell, I might even sell short EUR/USD.

First, I very clearly said I was not advocating the rent control aspects of Baker’s plan; I’d prefer they pay market rent. If they do so at the outset, I don’t see why they can’t be asked to later.

Second, the action of the rent controlled tenant you describe are illegal on two counts. First, it is illegal to sublet ANY rental in New York without landlord approval (although landlords are also required not to unreasonably withhold such approval). Second, charging more than you are paying in rent is clearly illegal. It not only means that the landlord can terminate the lease, but I believe he can also pursue the now former tenant for the overcharges.

Indeed, in New York, even charging a roommate more than his pro-rata share of the rent is illegal and ground for lease termination.

The landlord was not very competent if he had to resort to petty harrassment to get rid of the lawbreaking tenant, It isn’t hard to establish that an illegal subtenant is in residence. It sounds like a matched pair: a tenant and landlord who couldn’t be bothered to adhere to the law.

Saying that illegal acts happen under rent control laws means rent control is a bad idea is like saying that the fact that people drive drunk means drinking should be abolished.

Well maybe. I know someone who inherited a Soho tenement apartment (separate bathroom down the hall) from his parents. His rent was under $700. He was going to school and subletting it illegally — Hey, I probably would have gone for the easy money too.

In the end the landlord resorted to petty harassment (no gas for a few months, etc.)

So I would say Baker’s rent control policy is best limited to a period of 5 years or maximum 10.

There is a problem (as Kline and others mention) that the servicers feel or are constrained by the securitization agreements in making changes, and a lot of mortgages are tied up in those vehicles. Personally, I wonder how much of this is really due to legal issues, as opposed to servicers not being set up to do this sort of thing (while banks in communities can be more flexible) but that issue in the end is probably of little import.

Thus acts of Congress (or government sponsored plans like the Hope Now Alliance) appear necessary to give them the needed cover.

I agree banks don’t want to be in the property ownership business. But that behavioral bias is costing them money in this environment. With so much overhang, property management seems inevitable. Maybe there is a way to make lemons into lemonade.

Old real estate hands tell me banks would often do deed in lieu of foreclosure (that was the grown-up. polite, bank initiated version of jingle mail).

Is that in the case of eviction (when they also would have gotten the value of the deposit back by virtue of non-payment of a month or more or rent) or in general?

Apologies re your first name. I am very bad at proofreading, particularly as regards names.

As to mischaracterizing your post, it has four paragraphs of your text (excluding the quotes that describe the proposal) that attack the proposal in non-specific ways (in this day of various proposed interventions, I don’t see the issue of “it interferes with property rights” as sufficient without some detail as to how the property right holder is damaged) before getting to your specific complaint. The section I quote is when you finally get specific in your objections. Hence, “fulminates”.

Then we have another paragraph in which you question the loyalties, in dripping with contempt tones, those economists in the conservative camp who support the concept.

This was the only other substantive objection I can find:

It’s bad enough when state and local governments, our “laboratories” of “progressive” social experimentation, start screwing around with the free market and end up screwing the pooch by reason of the operation of the laws of unintended consequences and of human nature.

Given that free markets got us into a situation that has precipitated the worst financial crisis since the Great Depression, and said free markets (which I have discussed elsewhere at length is actually an internally inconsistent construct) are not delivering any remedies (oh, and that government you so detest has had to intervene to prevent a systemic financial collapse, an inconvenient fact you fail to acknowledge), I don’t see how my post can be labelled “dissing.” That implies an ad honimen attack. Calling your diatribe against renters “class snobbery” is not an inaccurate characterization.

But as your post illustrates, you seem happy to dish ad hominen attacks out. Projection, perhaps?

I would invite your blog readers to visit http://www.SwapRent.com and share with us some feedback. Thanks.

One small bit of proof, many landlords are now requiring renters insurance, often in the place of a refundable deposit. My guess is that will become standard practice.