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The Hot Property That’s Next on Tech’s Agenda: Real Estate

nytimes.com

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Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#61

Post by dyeje »

newacctjhro wrote: post #17
r_smart wrote: post #11

Earlier quoted context omitted.

>Rent shouldn’t be anywhere near comparable to mortgages. How am I supposed to rent you a house if the rent you pay is less than the mortgage I have on the house? How do I build a pool of money to use for repairing the things that inevitably break?

You're building equity with the difference between rent (plus repairs etc) and the mortgage. The renter isn't.

The renter also isn't assuming responsibility for keeping the property in repair. The owner assumes all the risk.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#62

Post by dragonwriter »

dyeje wrote: post #61
newacctjhro wrote: post #17

Earlier quoted context omitted.

You're building equity with the difference between rent (plus repairs etc) and the mortgage. The renter isn't.

The renter also isn't assuming responsibility for keeping the property in repair. The owner assumes all the risk.

> The renter also isn't assuming responsibility for keeping the property in repair.

That depends on the terms of the lease.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#63

Post by r_smart »

michaelscott wrote: post #45
saiya-jin wrote: post #25

Earlier quoted context omitted.

Yes, and you are exposed to myriads of risks that tenant isn't either - property market crash, tons of possible environmental disasters, issues with plumbings, fires, damage done to property, gradual degradation of, well everything. Another thing is the amount of time and energy invested into acquiring, renovation, maintenance and improvement of the property. Financially any of those, especially market crash can ruin…

Yes, and you are exposed to myriads of risks that tenant isn't either - property market crash, tons of possible environmental disasters, issues with plumbings, fires, damage done to property, gradual degradation of, well everything. A property investment, like any investment asset, is a bundle of risks as well as rewards. Yes, you as the owner take on the risk of things like market crashes, insurance and repairs but…

Right, and you price the rent based on that risk profile. A price that is absolutely going to be higher than the mortgage, unless as another commenter pointed out, there are incentives & tax breaks that cover the cost you would otherwise bear.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#64

Post by r_smart »

karambahh wrote: post #53
r_smart wrote: post #11

Earlier quoted context omitted.

>Rent shouldn’t be anywhere near comparable to mortgages. How am I supposed to rent you a house if the rent you pay is less than the mortgage I have on the house? How do I build a pool of money to use for repairing the things that inevitably break?

Depending on the local regulations, you can turn a (long term) profit while a rent inferior to the mortgage repayments. Can't get on the specifics as it varies country to country and even local regulations but as anecdotal evidence, I'm currently looking at a property in my hometown, with a mortgage of 80k€ (cost of mortgage 7k€, 10 years). This property would rent at 4000€/y, resulting in a yearly loss of roughly 40…

Assuming the laws don't change. Also, you're just externalizing the cost to everyone who pays taxes. Not my favorite business model, but carry on.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#65

Post by lostmsu »

voicedYoda wrote: post #36
anoncoward111 wrote: post #33

Earlier quoted context omitted.

Here on Long Island, NY, renting with one roommate is infinitely more profitable than owning a house: Renting = $1,900 a month for brand new construction, centrally located 1br apartment including utilities Owning = $3,300 a month for 2br dilapidated house, inclusive of property tax, home owners insurance, massive utility bill, and I haven't even factored in repairs of equipment from before 1960 Sure, you could rent…

Just as a slight clarification, if you set yourself up to rent part of the house, you could convert ownership of the house to an llc, or soon legal entity, and then that organization collects rent from you and tenant, which pays the mortgage, property taxes, utilities, etc. Do this only if you intend to rent portions out, as it can reduce liability. Ymmv and ianaa

Why do you need an LLC for that? Apart from liability.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#66

Post by lallysingh »

anoncoward111 wrote: post #33
lallysingh wrote: post #31

Earlier quoted context omitted.

The markets for owners vs renters is different. People with the means will buy if they have reasons for staying in one place for a long time. They will rent if they don't. That can depend on the local economy, schools, livability of the area, industry trends, etc.

Here on Long Island, NY, renting with one roommate is infinitely more profitable than owning a house: Renting = $1,900 a month for brand new construction, centrally located 1br apartment including utilities Owning = $3,300 a month for 2br dilapidated house, inclusive of property tax, home owners insurance, massive utility bill, and I haven't even factored in repairs of equipment from before 1960 Sure, you could rent…

Yeah owning there only makes sense if you want to live there a long time.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#67

Post by lallysingh »

anoncoward111 wrote: post #35
lallysingh wrote: post #32

Earlier quoted context omitted.

Yup, but the difference is that some of your appreciating asset is being paid for by someone else. In some cases that's worthless, in others quite valuable. As for pricing, the market does that for you.

When it works, it works really well. When it goes wrong, it fails catastrophically. That is to say, the variance of slumlording and poker arr probably equal :)

Yes, investments involve risk. If you believe that another cataclysmic crash is coming to the real estate market, then stay out. If you think it's unlikely, it can be a relatively low risk investment for the returns.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#68

Post by anoncoward111 »

lallysingh wrote: post #67
anoncoward111 wrote: post #35

Earlier quoted context omitted.

When it works, it works really well. When it goes wrong, it fails catastrophically. That is to say, the variance of slumlording and poker arr probably equal :)

Yes, investments involve risk. If you believe that another cataclysmic crash is coming to the real estate market, then stay out. If you think it's unlikely, it can be a relatively low risk investment for the returns.

I definitely agree, but I wouldn't say the market crash is the biggest risk.

Tenants who damage the property and withhold rent are way worse.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#69

Post by propyinc »

Real estate has always been a stable asset. The problem with it is that people are used to buying or selling a house a certain way, and they often do it only once or twice in their lifetime. The offer stage is very untransparent and manipulative. The closing process looks so hard that everyone thinks that we should pay 6% to agents and thousands of dollars to title companies. Tech can make the process to be transparent. Propy is doing it with smart contracts.

The question is raised whether there are more efficient or straightforward methods of doing transactions of real estate. Why shouldn’t buying properties globally be as simple, as buying a laptop from an online store in a different country? Some of the benefits of being able to purchase real estate globally easily: -You’d able to invest low amounts for a stable return -The real estate market would gain liquidity -You’d have access to multiple markets

Blockchain technology is one way this can be done, and we’ve already had successful global real estate transactions on our platform using it.

Re: The Hot Property That’s Next on Tech’s Agenda: Real Estate

#70

Post by dragonwriter »

michaelscott wrote: post #42
r_smart wrote: post #11

Earlier quoted context omitted.

>Rent shouldn’t be anywhere near comparable to mortgages. How am I supposed to rent you a house if the rent you pay is less than the mortgage I have on the house? How do I build a pool of money to use for repairing the things that inevitably break?

The rent you charge is for providing a domicile, I as a renter couldn't (and shouldn't) care whether this is enough to deal with repairs, especially since you as owner are certainly not repairing things every single month. If the rent is more than the mortgage why would I rent? Beyond potential credit problems (which can generally be solved within a matter of months barring egregious exceptions) and maybe conveyancin…

> If the rent is more than the mortgage why would I rent?

Because the you don't have the savings for the downpayment to qualify for the mortgage with the payment at issue.

Because property ownership cones with more expenses than just he mortgage, many of which remaining with the owner in most leases.

Because no one is selling single units of the type you want at the time, but someone is renting them out.

Because you're bearish on the housing market and prefer the risk of paying too high a rent at the end of a relatively short lease term to longer-term exposure to risk of loss of property value.

Because you intend to have a federally controlled, even if state legal, substance on the property, and want to control your exposure to risk from civil forfeiture.

Etc.

Etc.

Etc.

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