Rents for the rich are going down, rents for the poor are going up. Why?

Post by alisonkisk » Mon, Mar 22, 2021, 10:40 PM UTC

gnicholas wrote: post #72

outside1234 wrote: post #5

It is a huge risk right now to take on someone that is poor as a renter because of the moratorium. It is completely unsurprising to me that landlords have priced this risk factor in.

Interestingly, if landlords were allowed to use larger security deposits, some would choose to do this instead of raising the monthly rent. My friend is looking to rent out an ADU, and the first idea was to have a sizable security deposit in order to filter applicants who fully intended on paying rent from those who would be more likely to use the eviction moratorium. But apparently California tightened the rules aro…

Post by alisonkisk » Mon, Mar 22, 2021, 10:46 PM UTC

rainyMammoth wrote: post #49

majormajor wrote: post #36

Earlier quoted context omitted.

You can't get the same leverage nearly as safely or as easily in the stock market, which is why so many people start to play landlord with second, third, etc, properties that they finance. What changed in the last year is that people want a lot more space which is pulling them out of the "expensive apartment" market and into the "house" market, while also being less concerned about commute distance. So the expensive…

Even with the leverage, it is in most cases still not a good investment. There are a lot of calculator out there that shows you the break even point between renting and buying. You forget all the horrible fees that come with owning a place (HOA, maintenance, property taxes, 6% lost to agents at every transaction)

Post by roguecoder » Mon, Mar 22, 2021, 10:51 PM UTC

legerdemain wrote: post #68

roguecoder wrote: post #17

While the article is interesting, there is one dynamic it missed: tech debt. Starting around 1975, housing supply stopped keeping up with the growth of housing demand. It picked back up fifteen years later, around 1990: https://www.brookings.edu/research/the-goldilocks-problem-of... (But that is on a national level: in the West, in comparison, housing growth hasn't been sufficient to house the new households formed a…

If cheap housing is expensive housing built 30-100 years ago, we should have had decades and decades of delapidating housing stock left to go before hitting a shortage. Not to mention your example of housing in Boston built at the turn of the 20th century. A laissez faire policy that makes the poor wait 120 years for housing is hardly any policy at all.

Post by imtringued » Mon, Mar 22, 2021, 10:55 PM UTC

foepys wrote: post #50

pdimitar wrote: post #23

Earlier quoted context omitted.

That, however, reduces their chance in getting tenants so it becomes a vicious self-feeding closed circuit process?

It's probably because of speculation. If there is a chance that the moratorium will end in July it's better to not have any tenants for a few months than bad ones you cannot evict and will trash your place. Also, unoccupied properties are always more valuable.

Post by imtringued » Mon, Mar 22, 2021, 10:57 PM UTC

tehjoker wrote: post #69

outside1234 wrote: post #5

It is a huge risk right now to take on someone that is poor as a renter because of the moratorium. It is completely unsurprising to me that landlords have priced this risk factor in.

It's crazy that we live in an economy where you have to pay just to live somewhere, but when the eviction moratorium ends, there's going to be a huge financial reckoning as there's no way anyone is paying all that back rent. Biden is going to have to either bail out tenants or landlords and banks. I'll be taking bets on which one he does.