Who makes up these prices? (Austin, Howe: rentals, house, tenants)

[hitpausebutton2]

So shopping around and called up my old place and rent went from 980 to 1260 for a 2 bed 800sq.. So ask what changed in past year.. Management said that other people are raising their prices, so they are "force" to do theirs too. Really, "Forced" Who comes up with these rates? Dont give me that we do, as its base on price and demand.. I mean come on.. jobs here doesnt pay that well, unless you really own a business, lucky enough to get in a nitch market or inherit some good money. How is it that i can drive 20 miles out side of town, find the same size apt, own by the same management company and rent be 200 cheaper?

[centralaustinite]

20 miles away easily equals a $200 reduction in rent! I would imagine that just the portion of the property tax affixed to that unit would more than account for the increase.

Remember, most of the value of a residential or commercial property is in the land! Land in the central city is not cheap.

[hitpausebutton2]

Originally Posted by centralaustinite

20 miles away easily equals a $200 reduction in rent! I would imagine that just the portion of the property tax affixed to that unit would more than account for the increase.

Remember, most of the value of a residential or commercial property is in the land! Land in the central city is not cheap.

Should be sucked up as cost of doing business, not a cost to pass on to the consumer who needs a place to live. If your going to jack up the rent, least provide something to have a reason too, not just because others are doing it or your tax rate got a 10 cent increase.

[TexasHorseLady]

Originally Posted by hitpausebutton2

Should be sucked up as cost of doing business, not a cost to pass on to the consumer who needs a place to live. If your going to jack up the rent, least provide something to have a reason too, not just because others are doing it or your tax rate got a 10 cent increase.

Property tax increase is an absolute reason to raise rent - remember, the costs of owning the property have to be covered by the rent or there will be no house to rent very shortly. There is no 10% annual increase limit on rental property, either, as there is on a homestead - the sky's the limit, it seems. If everyone else is doing it, it is possible that the raised taxes cause raised rents for everyone and when they are forced to raise the rent and because of supply and demand they can get it they are raising the property values which raises the property taxes taxes which . . . well, you see where that goes.

Don't ever tell yourself you keep from paying property taxes by renting - everyone pays property taxes one way or another. If a landlord is to be able to keep the house to rent to you, as I said above, they have to be able to cover the costs of owning it plus a little profit to pay themselves for the trouble of having tenants or why bother - surely you wouldn't want to do your job for no pay, right?

[alwaysmiling]

Originally Posted by hitpausebutton2

Should be sucked up as cost of doing business, not a cost to pass on to the consumer who needs a place to live. If your going to jack up the rent, least provide something to have a reason too, not just because others are doing it or your tax rate got a 10 cent increase.

Nope, it's passed on to the consumer. When a property increases in value 10% per year, then the taxes go up 10%. So on an $800 apt, that's $80 per year. After 2 years that's $160. Think about that the next time you vote for an increase in COA taxes...

[alwaysmiling]

Originally Posted by TexasHorseLady

Property tax increase is an absolute reason to raise rent - remember, the costs of owning the property have to be covered by the rent or there will be no house to rent very shortly. There is no 10% annual increase limit on rental property, either, as there is on a homestead - the sky's the limit, it seems. If everyone else is doing it, it is possible that the raised taxes cause raised rents for everyone and when they are forced to raise the rent and because of supply and demand they can get it they are raising the property values which raises the property taxes taxes which . . . well, you see where that goes.

Don't ever tell yourself you keep from paying property taxes by renting - everyone pays property taxes one way or another. If a landlord is to be able to keep the house to rent to you, as I said above, they have to be able to cover the costs of owning it plus a little profit to pay themselves for the trouble of having tenants or why bother - surely you wouldn't want to do your job for no pay, right?

Hey we agree on something! Woohoo!!!

[Trainwreck20]

Haven't we had this same discussion before with the same user?

Anyway, supply and demand. Eventually, it will force the city to allow more units of some sort. The only reason the prices are so high now is BECAUSE the city tries to monkey with constraining the market too much.

[reenzz]

Say you owned a $50,000.00. Someone was willing to pay the $50,000.00 and someone else was willing to pay $30,000.00. Do you really think that you'd accept the $30,000.00 offer over the $50,000.00 offer?

It's called supply and demand. Look it up.

[austin-steve]

Originally Posted by hitpausebutton2

So shopping around and called up my old place and rent went from 980 to 1260 for a 2 bed 800sq.. So ask what changed in past year.. Management said that other people are raising their prices, so they are "force" to do theirs too. Really, "Forced" Who comes up with these rates? Dont give me that we do, as its base on price and demand.. I mean come on.. jobs here doesnt pay that well, unless you really own a business, lucky enough to get in a nitch market or inherit some good money. How is it that i can drive 20 miles out side of town, find the same size apt, own by the same management company and rent be 200 cheaper?

Originally Posted by hitpausebutton2

Should be sucked up as cost of doing business, not a cost to pass on to the consumer who needs a place to live. If your going to jack up the rent, least provide something to have a reason too, not just because others are doing it or your tax rate got a 10 cent increase.

You seem bitter. What are you saying, that you are entitled to lower rent, or an explanation of how the rent rate is set? You are not.

When I rent out property that I own and/or manage, I don't owe anyone an explanation about 'why' the asking price is what it is. In fact, nobody even asks 'why' it is a certain number. If I'm too high, the market will teach me a lesson by causing extended vacancy loss. If I am too low, I'll be rearded with quick lease-up but perhaps I'm not receiving the full amount I could. The 'market' sets rent prices. Landlords simply try to understand the market and listen to what it says.

Steve

[cBach]

If you want it cheaper then rent 20 miles out for $200 cheaper.

However, your gas costs and maintenance on your vehicle will be higher and you'll be sitting in traffic longer and time=money.

You can't change the pricing, that's supply and demand. There are people willing to pay $200 more to be 20 miles closer. Maybe you don't think it's worth it but they do. I don't agree that the rate is based on property taxes, supply and demand dictate the price. If the demand is such that $5000/month rentals will be accepted, even if the owner is making a margin of 98%, they'll do it. If the market says that a $980/month is all the market can bear, then the owner has to set that price even if the profit margin is 1%. If there is no profit, the owner has to still set a price that the market can bear and then decide if he/she wants to remain "in" with lower margins. We don't have those problems in Austin, but this is how "slum landlords" occur in cities like Detroit.

It's all about priorities. You can't control the price but you vote with your feet. If everyone voted to move 20 miles out, the prices 20 miles out would rise and the prices downtown would lower. Then people would move back downtown. The market would eventually equalize.