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  #51  
Old 05-03-2012, 10:57 PM
Eva Luna Eva Luna is offline
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Originally Posted by BlinkingDuck View Post
I *think* what the OP is complaining about without realizing it is that wages are in decline...the standard of living is falling. The 4% is essentially inflation...which means the landlord is essentially charging the SAME year to year to year....not more each year.

The fact that wages are not going up with inflation (i.e. people are getting paid less year after year) is what the OP is really angry about.
The rent is possibly going up even less than inflation. Our property taxes have gone up 25% in the past year, and our property taxes are about 20% of our monthly housing costs.
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  #52  
Old 05-03-2012, 11:28 PM
Rachellelogram Rachellelogram is offline
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Get a 2 bedroom and move in an extra roommate. It sucks, but times are tight. You won't be the first couple who's had to share living space to make ends meet. Take the money you save on rent and put it by for a house down payment.
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  #53  
Old 05-04-2012, 12:12 PM
Anne Neville Anne Neville is offline
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What business are you in, that you can't raise your prices? Most businesses can and do raise their prices for their products or services as their costs go up. If you can't, you don't have a sustainable business model. You might even be in a dying industry. It might be better to cut your losses and get out now rather than in several years when you've run up a lot of debt trying to keep your business going. There's no guarantee anywhere that any kind of business will be successful, or that a business that once was successful is always going to be successful.
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  #54  
Old 05-04-2012, 01:23 PM
diggerwam diggerwam is offline
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In my job I analyze budgets for apartment complexes and yes costs go up at least that much on an annual basis. I agree. Very lame pitting everybody's costs go up everywhere. Of course those increases will be passed along to the consumer. Duh!
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  #55  
Old 05-04-2012, 02:48 PM
mhendo mhendo is offline
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Originally Posted by diggerwam View Post
In my job I analyze budgets for apartment complexes and yes costs go up at least that much on an annual basis. I agree. Very lame pitting everybody's costs go up everywhere. Of course those increases will be passed along to the consumer. Duh!
But as i suggested before, it's not really "Duh!" if the market won't support your price increases.

If your costs, as a landlord, go up (for example) 6 percent in a given year, but rents in your area stagnate, then you can whine all you like about wanting to pass your cost increases along to the consumer, but you'll have a hard time raising rents if the market itself won't support the increases.

Just like the landlord has no obligation to take the tenant's salary increases (or lack thereof) into account when setting the rent, the tenant has no obligation to take the landlord's expenses into account when deciding whether or not to put up with a rent increase in a flat market.

As i mentioned earlier in the thread, i negotiated a rent reduction a couple of years ago, based on the market in our area. When i asked for the reduction, my landlord resisted at first, saying to me that his expenses had increased and that he thought that our original rent was a fair amount.

I said to him, as politely as possible, that his expenses were of no interest to me. My only concern was whether i was paying a rent that reflected the market value of the property, and i was basing my request for a reduction on the fact that market rates in the area had decreased, and that the next-door condo had remained vacant for over two months after previous tenants moved out, leading to a reduction in the advertised rent to less than what my wife and i were paying at the time.

I also made clear to the landlord that he was well within his right to refuse my request. I said, "If reducing the rent won't allow you to cover your expenses on this property, then i'll understand if you say no. But if you do, i'll also have to start looking for another place, because i know that i can get a place as good as this for less money in the same area."

I guess my point here is that some landlords seem to have the same problem as the OP of this thread, from the opposite end of the deal. Some landlords seem to assume that the laws of nature accord them the right to annual rent increases even in stagnant or declining markets, and then wonder why good tenants move out.

Last edited by mhendo; 05-04-2012 at 02:48 PM..
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  #56  
Old 05-04-2012, 04:02 PM
Fotheringay-Phipps Fotheringay-Phipps is offline
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That's all completely true of course, but it's also true that - all else being equal - if the factors that caused a given landlord's expenses to go up are general factors that apply to all landlords in the area (e.g. taxes, or general inflation) then this will tend to push the market price higher.

OTOH, all else is not always equal, and if an area is in decline (or too much new housing created) then the market rates can get pushed down anyway, and if the landlords' expenses are going up then that's their tough luck.

Last edited by Fotheringay-Phipps; 05-04-2012 at 04:02 PM..
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  #57  
Old 05-04-2012, 04:57 PM
Zebra Zebra is offline
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NOoooooo Landlords make the same profit every year. No matter what. Any and all new expenses are pass on to the tenants. In fact, we should feel sorry for them as I'm sure they are traumatized by raising the rents.

Of course the face that people are lucky to get a 2 or 3 percent raise a year is their tough luck. Maybe I should go to my boss and tell him that my expenses have gone up 4% so my salary will be going up 4%.
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  #58  
Old 05-04-2012, 05:02 PM
John Mace John Mace is offline
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I can't tell if that's sarcasm or real. I'm sensing it's not sarcasm, which is kind of scary.
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  #59  
Old 05-04-2012, 05:16 PM
Euphonious Polemic Euphonious Polemic is offline
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Quote:
Originally Posted by Zebra View Post
NOoooooo Landlords make the same profit every year. No matter what. Any and all new expenses are pass on to the tenants. In fact, we should feel sorry for them as I'm sure they are traumatized by raising the rents.

Of course the face that people are lucky to get a 2 or 3 percent raise a year is their tough luck. Maybe I should go to my boss and tell him that my expenses have gone up 4% so my salary will be going up 4%.
Then, (to paraphrase mhendo, who had very good points):

If your costs, as a consumer, go up (for example) 6 percent in a given year, but salaries in your field stagnate, then you can whine all you like about wanting to pass your cost increases along to the company, but you'll have a hard time raising your salary if the market itself won't support the increase.

What is so hard about these concepts?
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  #60  
Old 05-04-2012, 05:54 PM
Darth Panda Darth Panda is offline
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on edit, I'll just say this: Rent is bad and we shouldn't have to pay for stuff.

Last edited by Darth Panda; 05-04-2012 at 05:56 PM..
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  #61  
Old 05-04-2012, 06:18 PM
pulykamell pulykamell is offline
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Quote:
Originally Posted by Zebra View Post
NOoooooo Landlords make the same profit every year. No matter what. Any and all new expenses are pass on to the tenants. In fact, we should feel sorry for them as I'm sure they are traumatized by raising the rents.

Of course the face that people are lucky to get a 2 or 3 percent raise a year is their tough luck. Maybe I should go to my boss and tell him that my expenses have gone up 4% so my salary will be going up 4%.
Well, if you're in a field that would support that kind of increase, go for it!

If the market can support a 4% (or higher) increase in rents, then what is there to complain about? As a landlord (well, it's more my wife, really), I would probably not increase rents 4% every year, because if I find a good tenant, that's worth it for me for the 4% increase. I'd only raise rates after a couple years or a new tenant. But if my business model is such that I decide the risk between one tenant and another is negligible, and the 4% increase in rent is supported by the market, then why the hell wouldn't I do it? It's just good business sense.
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  #62  
Old 05-04-2012, 09:02 PM
Algorithm Algorithm is offline
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Quote:
Originally Posted by Zebra View Post
Maybe I should go to my boss and tell him that my expenses have gone up 4% so my salary will be going up 4%.
I don't know if this has been mentioned before in the thread, but it's pretty simple math. If you keep rent at around 1/3 of your income, and rent goes up 4%, you don't need a 4% raise to cover the increase in expenses.
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  #63  
Old 05-04-2012, 09:37 PM
Euphonious Polemic Euphonious Polemic is offline
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Quote:
Originally Posted by Algorithm View Post
I don't know if this has been mentioned before in the thread, but it's pretty simple math. If you keep rent at around 1/3 of your income, and rent goes up 4%, you don't need a 4% raise to cover the increase in expenses.
Yes, good point. A 1.3% raise should about cover it. Simple math seems to be beyond many folks though, sadly.
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  #64  
Old 05-04-2012, 10:52 PM
Gorsnak Gorsnak is offline
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Quote:
Originally Posted by Algorithm View Post
I don't know if this has been mentioned before in the thread, but it's pretty simple math. If you keep rent at around 1/3 of your income, and rent goes up 4%, you don't need a 4% raise to cover the increase in expenses.
He didn't say his rent had gone up 4%, but that his expenses had gone up 4%.
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  #65  
Old 05-05-2012, 12:02 PM
Euphonious Polemic Euphonious Polemic is offline
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Originally Posted by Gorsnak View Post
He didn't say his rent had gone up 4%, but that his expenses had gone up 4%.
We're referring to the OP, who is complaining about getting a years notice that his rent will be going up by 4%
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  #66  
Old 05-05-2012, 09:28 PM
astro astro is offline
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Quote:
Originally Posted by mhendo View Post
But as i suggested before, it's not really "Duh!" if the market won't support your price increases.

If your costs, as a landlord, go up (for example) 6 percent in a given year, but rents in your area stagnate, then you can whine all you like about wanting to pass your cost increases along to the consumer, but you'll have a hard time raising rents if the market itself won't support the increases.
This is true in some areas, but the market reality in many areas of the US (obviously not all) is that the residential rental market, and apartments especially, are doing quite well over the past year or so as getting starter home mortgages has become considerably more difficult and people are sticking with rentals.

Another factor is sticking with rentals is that the rationale and motivation in acquiring a home to build equity seems like bad joke these days.
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  #67  
Old 05-06-2012, 03:35 PM
elmwood elmwood is offline
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Originally Posted by Eonwe View Post
I profess my interest to the land-lady, who tells me as we're finishing the conversation to "not be surprised that we raise the rent about 4% every year. Our expenses keep going up; to operate the building and such."
I"m somewhat sympathetic. I live in a college town, too. There's a severe housing shortage, in part due to very strict zoning that reflects the NIMBY mindset of the thousands of back-to-the-land hippies and garden ladies that live here. (FWIW, I was bought here to help change this, among other things.) The missing middle in the housing market is more like a Grand Canyon-like chasm - plenty of large-lot subdivisions and gentrified in-town houses for for the well-off, and no shortage of subsidized developments for the low-mod income working class, but almost nothing for the middle class, which includes many in academia. Leases all run on the student cycle - everything is August through July, and you're asked to renew in February. Rents are among the highest in upstate New York, and the standard of rental housing leaves a lot to be desired.

Still, I expect that every March, when my landlord asks me to renew my lease, the rent will go up. Inflation happens. Be lucky it's only 4%, given the constraints of the housing market in many college towns. I have the down payment for a very small house here, but even with great credit I have to be here a couple more years until I can get a mortgage. Also, with the rental cycle, home prices make seasonal jumps.

I still own my old house in a suburb of a Rust Belt city, and I've kept the rent the same for three years. The tenants take good care of the place, and I don't want them to leave. I lose a bit of money every year from maintenance, but it's a much smaller hit than having the place stay empty for a couple of months while the management company finds new tenants. It's a much different housing market, where as a landlord, I don't have the luxury of being able to raise the rent a lot. Maybe next year I'll up the rent by $50.

Last edited by elmwood; 05-06-2012 at 03:38 PM..
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  #68  
Old 05-06-2012, 06:08 PM
PunditLisa PunditLisa is offline
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Reason #623 why I don't want to be a landlord: See OP
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