No, it’s not. But your kindly landlord is likely going broke renting to hookers with hearts of gold.
Oh, no, wait… he’s not, because neither one exists.
I think we’re in agreement that there’s a spectrum from a mythical landlord who might rent for any reason but income, to the most greedy slumlord who cries himself to sleep knowing he left his tenants a dollar for food. I can concede that specialty renting situations might have special cases. But in some enormous aggregate, landlord/owners will charge as much as they can, market conditions acknowledged, and will never fail to charge that much in any usual case.
To believe that there is any significant number of commercial landlords who rent cheap because they don’t need any more money than that is… heart of gold territory. And I’ve known more than a few hookers. And more landlords.
You raise rents when appropriate. “When appropriate” is not the same thing as “at my personal whim”.
THAT IS MY POINT. I don’t know how I can word it any simpler than this.
“Landlords will occasionally raise rents to maintain their profit margin”.
“Landlords HAVE to raise rents to maintain their profit margin”
The first is true. The second isn’t.
If a landlord finishes paying down a mortgage, they can certainly raise rents the following year. But must they do so? No. Do they always do so? No.
I lived in my rental home for four years without seeing a rent increase. My town is full of crappy rentals that cost just as much as they did when I first moved here. “Skyrocketing rents” is a reality. But it is not a unversal phenomenom.
You’re arguing that they never do it unless somehow pressured to. The rest of us are saying rents will go up when conditions allow them to… and it’s no “whim” of a landlord to bring his rents into line with the market, even if he’s already grossly rich.
I lived in mine for 13 years with one $50 increase about halfway through. When I moved out, the owner was going to sell but a new tenant insisted on taking the place at 2-1/2 times the rent. He graciously caved. It’s still on the rental market and is about 4X what I was paying… market rate. And this WAS a nice guy, preferred good tenants to max profits, landlord.
The trend is definitely there, and will probably continue, since it’s driven by a number of social and economic trends that are likely to continue.
Increased urbanization means that the population density the average person lives in is increasing. That means storage space is more expensive and travel distances are shorter. If you need a car every day to go to work, it makes sense to own one. If you need a car every once in a while for a trip or to haul a large purchase home, it makes more sense to rent. And more people are moving into the latter category.
Technological innovations mean that administering and scheduling rentals are more convenient and cheap. If there’s a smartphone app that lets you schedule and unlock your rental, then you don’t need to pay an employee to handle it, and transaction costs go way down. It’s now reasonable to rent smaller and cheaper things.
Living space rentals will probably increase as well, both because building domiciles in cities is a much more capital and regulation intensive process, and because of government policies to prop up the cost of houses to protect current property owners (and banks). Young people are renting in many places because they simply can’t afford to buy.
Not all of those are “renting”. Some are much more akin to buying, and some are the same old subscription model, only delivered electronically. For example, you can get the paper through the web or in printed format- the subscription is much the same. Same for magazines. You can purchase books, movies and music and then stream them from elsewhere. Amazon does this commonly with instant video and the Kindle. They just have the network that allows access… but neither are for-pay, if you really want to get nitpicky. There’s nothing that says you have to own a Kindle to read e-books; you can use the web-app if you so choose.
The only one that’s seriously changed is the move to more of a subscription model for software, as shown by Word, etc… You never really owned it in the first place, you just had a license to use it. Now they’re charging you a per-month fee for that license instead of a larger up-front fee.
As far as renting vs. owning homes; the reason many young people do it isn’t necessarily a money thing, but rather a mobility thing. Plenty of people in their mid-20s are still in a period of flux, where they may get married/partner up, they may change careers, they may switch jobs, etc… and all of those have high potential of warranting a move to another city, or another part of the city they live in. Once people get a little older, they “settle down”, and at that point, the majority DO buy homes/condos, etc…
Thanks for posting. I assume that you are well aware of the market, and don’t raise rents enough to scare people away. (The definition of what the market will bear , I suppose.) It appears that people are denying that the rental market goes up by n% just because they have lucked into a landlord who for one reason or another never raises rent.
Plus, around here anyhow most apartments are owned by large companies which somehow lack the milk of human kindness so obviously universal - and want to make money for their shareholders.
Anyhow, my point was that rental prices on average have gone up a lot faster than my house costs. One in a hundred renters here might have lucked into an almost fixed rent - almost anyone who bought when I did and didn’t try to take money out of their house will be in the same situation as me.
I didn’t say anyone here said that. But a lot of people seem to think raising rents are something that everyone has to worry about all the time. Or that the homeowner is always doing better than the guy renting the property next door. People make a lot of assumptions about renting and landlording that aren’t true.
No, I’m saying that not every landlord is under the same “pressure” or “conditions”. The market isn’t the same for everyone.
Not everyone is living under the same fear of being priced out of their rental unit. A renter would be wise to find out if they are at risk of this happening. But a heap of them don’t have anything to worry about.
Companies like the software rental model because it evens out their software revenue stream. Without it they get a big bump when a big new release comes out, and a big drop when people are waiting for a new release. It certainly reduces the need for innovation, especially in a quasi-monopoly situation like with Office.
And in this situation they tend to pay market rates by definition, since they are not in one place long enough to have a benevolent landlord.
I’ve thought of another good reason to rent - people in a situation where they need or want roommates are much better renting. Buying a house with a roommate can lead to all sorts of problems.
This is exactly my situation. I love my landlord. He was the property manager for my first landlord and also owned and managed his own properties. He’s a really great guy, repairs things super quick or thanks us when it’s something we can take care of ourselves.
We left our first (dumbass) landlord at the same time current landlord quit managing dumbass’s properties. We moved into one of his flats with ~150ft² more space and he didn’t raise the rent. He still has never raised our rent, even though we met with him last August to go over a new rental contract.
We’re paying $300-700 less per month than what equivalent rentals are going for currently.
Had been a husband and wife team, but they divorced and split the properties between them, so we had to sign a new lease with just him.
I don’t think it’s that simple. What I learned from that same experience was that it makes way more sense to rent than to buy. Cheaper and easier.
I bought the music I wanted, too. I spent many hundreds of dollars on CDs and tapes. But, honestly, I don’t necessarily want to listen to most of the music I listened to when I was a teenager and bought lots of cds. Those cds sit in a box. Spotify is free with a few ads.
I bought VHS tapes. Only very few of them did I watch enough that I wouldn’t have been better off just renting them each time I watched them. Trashed them all years ago because they’re such low quality. I bought DVDs too. A few years ago when I gave them away in favor of streaming and Bluray and digital downloads, at least a half-dozen were still in the wrappers. What a waste.
I used to buy lots of books. But the library has them for free, and even the really popular ones I only have to wait a few months for.
I have rented from a variety of landlords, and I’ve never had to endure the hardships or mishaps that renters are often told they should expect. No one has ever jacked up my rent to a level that I couldn’t afford to pay (probably because I’ve always shopped for affordable places, not fancy-pants penthouse suites that would strain my budget). No one has ignored my calls or jerked me around or suddenly evicted me. I only had to endure one awful neighbor, back in the early days. But the thing about renting is that everything is temporary. After a year, I picked up and moved and I didn’t have to deal with that crazy guy anymore.
Everything that is crappy about renting can also apply to homeowning. If you don’t have enough money in your emergency fund to replace a major appliance guess what? You’ll have to go without, the same as if you had a negligent landlord. Bad neighbors don’t discriminate against renters and homeowners. Skyrocketing housing prices can also put the screws on homeowners, not just renters. They are certainly financial benefits of owning. But someone would have to be insane to not see the financial benefits of renting too, especially for a 20-something who hasn’t even established a career or family yet.
There really isn’t a “fool-proof” plan in this life. With every decision, there’s an upside and a downside. I don’t trust the intelligence of people who seem to think that there’s always one right path to take and that it’s always easy to see. Sometimes you’ve got to try out a lot of different strategies for yourself before deciding which is best.
I wish the younger generations the very best. Ya’ll really are the future and it’s time we let ya’ll lead the way.
And, I’ll add, they are FAR NICER, NEWER cars than I could ever afford, even when I had one of my own. As well as far cheaper an outlay on my part, to drive the minimal amount I generally do.
When I owned a car, it typically moved maybe once a week, or once every other week, for a 10-15 minute trip to the store. There were times where I’d go months at a time only moving it for street cleaning – literally driving it around the block and finding another parking spot on the same street.
For that I had car payments, insurance (and ain’t no $100 a year insurance in the city, my friend – at the car’s shittiest, it was still $50-60 a month), gas, registration, city sticker fee (essentially a once-a-year property tax if you own a car in Chicago), and maintenance. And I got my cars used and cheap, so by the time I finished paying them off, I was on to the something-breaks-every-couple-months phase. We had a flash flood while I was still at work, by the time I got home the parked car was in standing water up to the doors. $600 brake job. Leaky gas tank. Oil changes, of course. Engine trouble. All that for something that by and large sat parked on my street. By the time the undercarriage broke in half I was glad to be rid of it.
Compare that to car share, where the annual membership fee is less than an annual car registration fee, and I pay maybe $15-30 a month for all my driving needs which includes gas, insurance, city sticker, and regular maintenance. I’m paying less than 20% of my former car expenses than I did when I owned one, and I have 10 cars to choose from within 10 minutes of my apartment, all of which are newer and run better than any car I’ve owned.
I wish car share had come a lot earlier, because I sure wouldn’t have kept a car for as long as I did otherwise. The math simply doesn’t make sense.
Of course these are both true, but my reply was to the idea that using a library is a form of renting books, movies and newspapers. You don’t walk in and pay rental fees on anything in a library. In terms of owning vs renting media, I don’t think using the library qualifies as renting.
We were eating al fresco in Cambridge tonight and we saw at least a half dozen Uber drop offs during the hour we were there. We saw no cabs. I’ve never seen that before, it’s definitely become one of the default modes of transport in a short time.
While I will grab a cab if I’m already out and on the street in an area where they’re driving by all the time, I’ll do that. But once I discovered how quickly I can be picked up at my front door by Uber, that’s the route I now prefer if I need to grab a ride from home. My alternative is to walk a block and then wait/hope for an empty cab to come by soon, when I’ve learned with Uber to already have my coat on and be ready to go because I’ve yet to have one take longer than 3 minutes to get to me once I send for the ride.
^ This has been my strategy the last couple of decades - I do some work around the place and what repairs I can (what I will/can do was discussed in advance). I get a low rent, the landlord knows he won’t be called for minor things. It’s a win for both of us.
Of course, YMMV and I’ll be the first to admit I was fortunate to get this arrangement.
