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31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

nytimes.com

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Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#51

Post by Spooky23 »

missedthecue wrote: post #38
jacknews wrote: post #25

Rents will have to come down or be waived. Almost by definition "rent" is simply extracting value from the productive economy through ownership. If the productive economy takes a dive or disappears, the amount you can extract must do likewise.

>Almost by definition "rent" is simply extracting value from the productive economy through ownership. What? Do you define any profit margin as such? Housing rent is not the same thing as the term 'economic rent'. Housing is as much a liability as an asset. There is risk with owning it. Rent payments are compensation for said risk. All profit is just compensation for risk.

Lol. Not at any scale. Once you own about a dozen units the principal risk is not getting over your head in debt.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#52

Post by gruez »

peacefulhat wrote: post #48
missedthecue wrote: post #38

Earlier quoted context omitted.

>Almost by definition "rent" is simply extracting value from the productive economy through ownership. What? Do you define any profit margin as such? Housing rent is not the same thing as the term 'economic rent'. Housing is as much a liability as an asset. There is risk with owning it. Rent payments are compensation for said risk. All profit is just compensation for risk.

Then should rents go up? It is now much riskier to be a landlord, risk that is going uncompensated...

Theoretically yes, although the demand curve also comes into play. In a parallel universe where the risks of a pandemic/lockdown was known and taken seriously, you would definitely expect rents to be higher.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#53

Post by aaomidi »

missedthecue wrote: post #38
jacknews wrote: post #25

Rents will have to come down or be waived. Almost by definition "rent" is simply extracting value from the productive economy through ownership. If the productive economy takes a dive or disappears, the amount you can extract must do likewise.

>Almost by definition "rent" is simply extracting value from the productive economy through ownership. What? Do you define any profit margin as such? Housing rent is not the same thing as the term 'economic rent'. Housing is as much a liability as an asset. There is risk with owning it. Rent payments are compensation for said risk. All profit is just compensation for risk.

And people like this is why I don't see a sustainable future for America and most of the world.

We need to unlearn our current relationship with housing and change our view entirely.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#54

Post by barrkel »

missedthecue wrote: post #38
jacknews wrote: post #25

Rents will have to come down or be waived. Almost by definition "rent" is simply extracting value from the productive economy through ownership. If the productive economy takes a dive or disappears, the amount you can extract must do likewise.

>Almost by definition "rent" is simply extracting value from the productive economy through ownership. What? Do you define any profit margin as such? Housing rent is not the same thing as the term 'economic rent'. Housing is as much a liability as an asset. There is risk with owning it. Rent payments are compensation for said risk. All profit is just compensation for risk.

Profit is not compensation for risk. Risk is a limiting factor in chasing after profits, sure, but you can take unprofitable risks, and if you have a particularly privileged position or information, you can make a profit with little to no risk. Hugh Grosvenor, 7th Duke of Westminster doesn't exactly take a lot of risk for his rents.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#55

Post by kccqzy »

dhd415 wrote: post #9
mkl wrote: post #4

Earlier quoted context omitted.

The article implied synchronised rents, and now you have too. To clarify: Are all rents in the US monthly and due on the first of the month? In NZ rent is weekly, on no particular day (can be different for each tenant).

Residential rentals in the US are priced by the month and I've never seen one in which the rent was not due on the first of the month.

Where I live, although the rent was technically due on the first, there's an automatic grace period of three days without late fees so the actual due date is the fourth.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#56

Post by missedthecue »

peacefulhat wrote: post #48
missedthecue wrote: post #38

Earlier quoted context omitted.

>Almost by definition "rent" is simply extracting value from the productive economy through ownership. What? Do you define any profit margin as such? Housing rent is not the same thing as the term 'economic rent'. Housing is as much a liability as an asset. There is risk with owning it. Rent payments are compensation for said risk. All profit is just compensation for risk.

Then should rents go up? It is now much riskier to be a landlord, risk that is going uncompensated...

Price (in essentially all cases, particularly for commodity goods like housing) is based on supply and demand, not on the individual financial situation of the person selling the product.

If demand for housing climbs noticeably, rates will follow, and vice versa (if supply of housing climbs, rates will plummet)

The reason profit exists is that risk must be assumed to earn it.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#57

Post by [deleted] »

FireBeyond wrote: post #44
capsulecorp wrote: post #13

Earlier quoted context omitted.

Start by banning China (and any other country that doesn't allow US citizens to own land) from owning property in the US. Something tells me when you get rid of all the foreign profit lords, that property will be much more affordable in many areas.

How do you make that happen, realistically? "You must sell." "Okay, this 3br house is $10MM. It's not selling." Eminent domain? Are we going to do that for the huge swathes of vacant homes we already have, too?

[deleted]

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#58

Post by _bxg1 »

shubidubi wrote: post #33

I don't get why it's not ok to steal food from a grocery store but it is ok to not pay rent. Both are basic necessities and in both cases you hurt someone else by not paying for service (food/shelter).

People without incomes right now can probably afford food, even if they can't afford rent. The fact is that a significant fraction of society is in an impossible situation right now, through no fault of their own. And probably very few rentiers are in that group.

Re: 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’

#60

Post by pmorici »

jacknews wrote: post #25

Rents will have to come down or be waived. Almost by definition "rent" is simply extracting value from the productive economy through ownership. If the productive economy takes a dive or disappears, the amount you can extract must do likewise.

I agree rents will probably come down, as they do in any economic down turn, but not because of some exploitative relationship between landlord and renter as you imply.

It's all supply and demand. Lower economic activity translates to lower demand. I'd also say that to imply that a landlord doesn't provide a service is total nonsense. There are plenty of reasons why people and companies might prefer to rent instead of buy the least of which is that a tenant doesn't have a long term financial commitment or principal / property value risk. There are many companies that even take their wholly owned property and sell it so they can lease it back in a triple net leasing arrangement because it benefits them to not have capital locked up in real estate value.

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