The housing market is complex, but one point I would like to make, is that if there is now a (global?) opportunity to borrow capital, buy houses on a mass scale and rent them out, that implies to me that there is a failure in mortgage market - families want housing in a location, it is possible to borrow money and buy them, but those families don't have access to that monet.
This implies
a) inequality in wealth and incomes
b) failure to change mortgage market to account for higher risk in harder to reach areas (this is what savings and loans were literally made for)
c) errr
d) that's it.
> The housing market is complex, but one point I would like to make, is that if there is now a (global?) opportunity to borrow capital, buy houses on a mass scale and rent them out, that implies to me that there is a failure in mortgage market - families want housing in a location, it is possible to borrow money and buy them, but those families don't have access to that monet.
Not sure I see the issue. Renting and owning has very different risk profiles, which is why you'll find people can rent a place they're unable to buy.
The risks are with loss of income, e.g. due to job loss, sickness etc. Such things are somewhat inevitable in the span of a 30y mortgage. In such a situation the tenant can move to more appropriate alternative housing, e.g. moving to a smaller home, a home that's not as well located, sharing a home with others, friends, family etc.
In the case of an owner it gets trickier, typically the person would eventually be forced to sell the house to be released from the contractual obligations to pay the mortgage. The risk events' probabilities correlate, i.e. you're more likely to lose your job in an economic downturn, as does everyone else, which means home prices are more likely to be low during an economic downturn, meaning a forced-sale during such times can mean you're selling your home for less than the value of the loan, leaving you not only out of income, out of a home, but also with a sizeable debt.
In other words, there can be reasonable explanations for why a government could buy homes and rent them out to tenants who can afford the rent, while those same tenants could not afford an equivalent mortgage.
Second, I think it'd be very sensible to assume that the government is not going to be renting out these units at market rate. In other words, they're subsidising the tenants, with taxpayer money. That's why the rent would be affordable, but the purchase would not, for the tenants. If anything that implies this decision is lowering the effects of inequalities, due to in-effect a redistribution of wealth from rich to poor.
This implies
a) inequality in wealth and incomes b) failure to change mortgage market to account for higher risk in harder to reach areas (this is what savings and loans were literally made for) c) errr d) that's it.