Is Rent the same as Interest?
-
Peace
If interest is money earned from money itself, isnt rent the same?
For example I have a million dollars. I lend it at 6% to earn interest. That is forbidden.
(2275) Those who consume financial interest, they do not rise except as the one who is being beaten by the devil out of direct touch. That is because they have said ?Trade is like financial interest.? While God has made trade lawful, and He has forbidden financial interest. Whoever has received understanding from His Lord and ceases, then he will be forgiven for what was before this and his case will be with God. But whoever returns, then they are the people of the Fire, in it they will abide eternally.
What if I buy an apartment block for a million dollars and rent out the flats. Would this 'rent' be considered 'interest' or 'trade'?
Sha
-
Peace,
The transaction you speak of is fine since it does not 'create' any injustice.
You are renting out an asset against payment in funds. This assumes that the 'funds' exist somewhere alreay (possibly from a revenue that the person renting the house has).
When we lend out 'money', we are inflating beyond the amount of funds that already exist (i.e. the money in circulation cannot meet the demand created by this 'new' growth).
-
Hi,
I believe that Gods system has a very simple rule of economics
?Your income is what you put in as work to create real values?
?Your expenses are what you need to uphold life?Only values that exist may be used, i.e. values must be created before we can use them.
In one way or another, your existence will consume values from the world around you.
If you are able to contribute, you have a responsibility to do so; if you are unable to contribute, the human community has the responsibility to uphold your life.Your ability to contribute may vary, and some can contribute more than others, but life is sacred and therefore the responsibility for the whole human community, and should be upheld, if in any way possible.
Interests do not create real values and therefore can not be consumed.
Rent of a house is OK if, what the landlord contributes, are real values. I.e. values are created and are available.This means that the rent of the house must reflect the work put in by the landlord.
He does work in order to keep the house in order. He keeps track of the rents and other things concerning the tenants etc. etc.
You have to pay the landlord for these costs of your occupancy, including the deterioration of the house due to wear and tear.As a landlord you can not, however, charge the tenants any rent for the fact that you or your forefathers have worked so hard that you/they were able to build the house in the first place. I.e. the value of the house is the value of the work put in, to be able to build it. shock
The house is, however, slowly ?consumed? roll , maybe over one hundred years, or whatever. Anyway, at the end of the period, when it is considered that the house is ?consumed?, the value of the work behind it should not be lost; it should just have been transferred into another value of similar magnitude. This similar value can slowly be transferred from the house to the landlord and taken out from those who have benefited from the existence of the house, i.e. be a part of the rent charged, so that at the end of the period the original value still remains.
In the meantime, the landlord or the heir, could have been working hard besides taking care of the house, and been able to build another one, or maybe a few, thereby adding to his/her wealth.
As far as I understand God allow us to gather wealth, but only through our own contribution, i.e. building of real values.I am afraid that this is not the way it works today. In most instances, someone able to build a house and rent it out, is relaxing in their contribution to the community, and let the tenants work for their own reduced activity. This means they are living from other peoples work.
This will then be the same as charging interest, i.e. an interest is a value that does not exist, so somebody must work to create it. Meaning it is a pure cost to the society.
The part of a rent, that is only to cover the landlords reduced contribution, is a value that does not exist and therefore must be created by others. Meaning it is a pure cost to the society.Simple basics leading to complicated calculations. mrgreen
Regds
Ali Omar
