'Dogfight' looms as landlords start suing restaurants over unpaid rent • Hacker News Board

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#11

Post by kfrzcode » Sun, Apr 05, 2020, 7:48 PM UTC

FartyMcFarter wrote: post #7

papeda wrote: post #5

I find this question hard to think about. Who exactly should be pricing in the risk of something like this happening? On both sides there are agents who have taken on risk. Some of the agents paying rent overextended themselves even before the crisis. Some of the agents renting space did the same. So who should take the hit? Nobody (i.e., the government)? Even that solution seems wrong -- do we really want to incenti…

Both should be pricing in the risk. If I buy a house as an individual I'm taking some of the risk, but so is the bank that lends me money. We each have different risks (I can lose the house, the bank can lose the money if they can't make it back by selling it), which is fine.

Honest question, how does one factor in risk for a catastrophic decline in cash flow?

I'd suggest having a war chest which could cover six months expenses.

I'm not a business owner though... I imagine it's probably harder to do than it is for an individual.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#12

Post by zraako » Sun, Apr 05, 2020, 7:48 PM UTC

boznz wrote: post #3

Any form of profiteering in a crisis such as this should result in massive fines and prison time, in war time I believe firing squads were in order.

Not usually a fan but starting to understand why Mao went so salty on landlords now

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#13

Post by jasonsb » Sun, Apr 05, 2020, 7:49 PM UTC

Ididntdothis wrote: post #9

I only hope that this won't lead to a situation where people and organizations with deep pockets will take over even more of the housing stock like they did in 2008.

That's exactly what's going to happen if the prices of real estate will plummet.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#14

Post by dahdum » Sun, Apr 05, 2020, 7:52 PM UTC

Government should take a hit, in my opinion. It's inefficient for every individual and entity to prepare themselves against things like this, especially since government action (stay at home orders) is exacerbating it. The business "bailouts", at least the in US, are mostly just loans anyway. Taking a "too bad" stance and letting businesses cascade fail prolongs the pain and leaves the country worse off when the crisis is over.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#15

Post by matz1 » Sun, Apr 05, 2020, 7:55 PM UTC

papeda wrote: post #5

I find this question hard to think about. Who exactly should be pricing in the risk of something like this happening? On both sides there are agents who have taken on risk. Some of the agents paying rent overextended themselves even before the crisis. Some of the agents renting space did the same. So who should take the hit? Nobody (i.e., the government)? Even that solution seems wrong -- do we really want to incenti…

The mistake is the landlord didn't take payment upfront, 6 month / 1 year.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#16

Post by Justsignedup » Sun, Apr 05, 2020, 7:55 PM UTC

dahdum wrote: post #14

Government should take a hit, in my opinion. It's inefficient for every individual and entity to prepare themselves against things like this, especially since government action (stay at home orders) is exacerbating it. The business "bailouts", at least the in US, are mostly just loans anyway. Taking a "too bad" stance and letting businesses cascade fail prolongs the pain and leaves the country worse off when the cris…

In that argument case, what about average citizens? Businesses seem to get bailouts when they fail because of unforeseen circumstances, but citizens are left to pay the bill. so in the end it is either fair, or someone takes a bigger hit.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#17

Post by koolba » Sun, Apr 05, 2020, 7:55 PM UTC

dahdum wrote: post #14

Government should take a hit, in my opinion. It's inefficient for every individual and entity to prepare themselves against things like this, especially since government action (stay at home orders) is exacerbating it. The business "bailouts", at least the in US, are mostly just loans anyway. Taking a "too bad" stance and letting businesses cascade fail prolongs the pain and leaves the country worse off when the cris…

That’s fine going forward but it’s not priced in yet so it’d be get another unfunded liability.

It’s like extending unemployment benefits to gig workers who never paid any unemployment tax.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#18

Post by raincom » Sun, Apr 05, 2020, 7:55 PM UTC

This is what happens when people drink the deadly cocktail mix of low interest rates and leverage. A landlord who has paid off mortgage can afford his tenant to not pay rent for a couple of months. That's not how the world is running now: REITs, individual landlords, partnerships, etc--all of them are profitable when there is a cash flow. The moment rents stop flowing under a certain limit, deleveraging starts. That's what happening in this market.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#19

Post by kfrzcode » Sun, Apr 05, 2020, 7:55 PM UTC

echelon wrote: post #8

dahdum wrote: post #4

Earlier quoted context omitted.

How exactly is this profiteering? They aren't demanding extra money or marking services up. They're at a high risk of bankruptcy themselves.

Businesses were told to close by the government to prevent spread of the virus, thus effectively shutting off their income. The government should shut off rent income, too. And mortgage payments. We're in survival mode. Nobody gets to make any money right now. We have to wait for the recovery to begin.

> Nobody gets to make any money right now.

This is a fantasy, and will never, ever happen... At least in the United States.

Re: 'Dogfight' looms as landlords start suing restaurants over unpaid rent

#20

Post by FartyMcFarter » Sun, Apr 05, 2020, 7:55 PM UTC

dahdum wrote: post #14

Government should take a hit, in my opinion. It's inefficient for every individual and entity to prepare themselves against things like this, especially since government action (stay at home orders) is exacerbating it. The business "bailouts", at least the in US, are mostly just loans anyway. Taking a "too bad" stance and letting businesses cascade fail prolongs the pain and leaves the country worse off when the cris…

> Government should take a hit, in my opinion.

Government means "everyone who pays taxes".

I'm not sure that's fair. I think it's fine to spend taxes rescuing people (including the business owners if they're in personal trouble), but rescuing businesses feels like a very different story.