Bay Area, CA-the rent is too d** high

[Tallysmom]

Originally Posted by aramax666

Btw , the typical process is to deduct the damages from the deposit. That seems fair to me. Not sure what your acquaintance is upto.

But -- if damages are over what the deposit is, the balance has to be paid. And the landlord has to pay it... which means the next tenant will be paying more to recoup the landlord's losses.

Every year when the new load of parcel taxes hit the ballots, I always remind my friends that voting for a lot of this junk is also driving up rents... because people still seem to miss the fact that even if you are renter, you can't avoid the parcel taxes. Yes -- the landlord has to pay them, but he'll get them from his renters.

[08grad]

From my experience, this is a very transient area for young professionals. People are driven here due to the well paying jobs and fantastic weather, but when you see the majority of your paycheck eaten up by the cost of living, that job becomes a resume builder instead of a career, and when a transfer opportunity in another major city opens up people pounce on it.

High rents with increasing student loan debt have made it very difficult for young professionals to save the amount of money required for a down payment, and that amount keeps going up every year due to housing price growth in the area. The thought of renting a room for years and living frugal to save up for a down payment for a house in a crappy area is not appealing to college graduates.

[FC76-81]

I think a lot of the issues involve mismanagement. What land lords need to be doing is set up reserves by setting aside a portion of the rents that they are collecting for both known and unknown risks. For example, When brand new tenant moves in, the first month that the renter collects money, all or a portion of the very first months rent should be set aside for known risks which are worn out carpeting and the general wear and tear that a land lord is supposed to address when tenants move out. The second months rent to be put aside for unknown/unforeseen risks, such as like in my friends condo case, floors needing to be replaced because of water damage, and stuff like that. The renter's deposit should cover out of the ordinary wear and tear like damage to walls, doors, windows. After the reserves have been established, a small portion of the rents collected every month should be set aside for general upkeep and repairs such as if something breaks under normal operating conditions.

I'm not seeing too much of this though. What I see from friends I have who own property that they rent/lease out is they simply collect the money and spend it as they please on anything and everything besides on the property that they are renting/leasing out. So when the time comes that something needs to be repaired/replaced, or if a tenant moves out and leaves damage, they've not put any money aside to fund such repairs and what happens often, as such with my friend with the condo, is they pass the expense onto the next tenants in the form of higher rent/lease. I personally think that's bs.. If you own or you know someone who owns their own apartment building, single family dwelling, building, etc. and who rents/leases it out, you will know how much money they are really bringing in. It's amazing how much money the people I personally know take in from rent/lease.

[Pretzelogik]

It be called the law of supply and demand.

[aramax666]

Yeah, I see that. I think people should be more scrupulous. But I guess, given the demand, landlords can get away with anything.

[Tallysmom]

Originally Posted by FC76-81

I think a lot of the issues involve mismanagement. What land lords need to be doing is set up reserves by setting aside a portion of the rents that they are collecting for both known and unknown risks. For example, When brand new tenant moves in, the first month that the renter collects money, all or a portion of the very first months rent should be set aside for known risks which are worn out carpeting and the general wear and tear that a land lord is supposed to address when tenants move out. The second months rent to be put aside for unknown/unforeseen risks, such as like in my friends condo case, floors needing to be replaced because of water damage, and stuff like that. The renter's deposit should cover out of the ordinary wear and tear like damage to walls, doors, windows. After the reserves have been established, a small portion of the rents collected every month should be set aside for general upkeep and repairs such as if something breaks under normal operating conditions.

I'm not seeing too much of this though. What I see from friends I have who own property that they rent/lease out is they simply collect the money and spend it as they please on anything and everything besides on the property that they are renting/leasing out. So when the time comes that something needs to be repaired/replaced, or if a tenant moves out and leaves damage, they've not put any money aside to fund such repairs and what happens often, as such with my friend with the condo, is they pass the expense onto the next tenants in the form of higher rent/lease. I personally think that's bs.. If you own or you know someone who owns their own apartment building, single family dwelling, building, etc. and who rents/leases it out, you will know how much money they are really bringing in. It's amazing how much money the people I personally know take in from rent/lease.

I knew a few people that owned and built large apartment complexes, and by necessity, they had to do this, but they also had to set up companies that ran the rentals to do so, and hire people to run them -- all of which costs money. But a lot of people love to play in the sun without keeping that umbrella handy, monetarily wise.

However -- there is a financial law your friends will get booted from -- what goes up, must come down. It never seems like it, until it does, but sooner or later the market will soften and they won't be able to recoup their costs via rental because there will be more rentals than renters, and the renters won't see the value of spending more so the landlord can recoup their costs.

I've been here for over 30 years, and I've seen the ragey highs and lows of our volatile real estate markets, and we bought during the first one, having people shake their heads and tell us we were crazy left and right because real state HAD to come down (boy howdy -- took 20 years, but yeah -- our area dumped back to nearly those 1987 levels, and now -- looks like we're already nearing the 2005 levels ), and I'm sitting in Oakland with a $400 mortgage payment.

[Ultrarunner]

Originally Posted by FC76-81

I think a lot of the issues involve mismanagement. What land lords need to be doing is set up reserves by setting aside a portion of the rents that they are collecting for both known and unknown risks. For example, When brand new tenant moves in, the first month that the renter collects money, all or a portion of the very first months rent should be set aside for known risks which are worn out carpeting and the general wear and tear that a land lord is supposed to address when tenants move out. The second months rent to be put aside for unknown/unforeseen risks, such as like in my friends condo case, floors needing to be replaced because of water damage, and stuff like that. The renter's deposit should cover out of the ordinary wear and tear like damage to walls, doors, windows. After the reserves have been established, a small portion of the rents collected every month should be set aside for general upkeep and repairs such as if something breaks under normal operating conditions.

I'm not seeing too much of this though. What I see from friends I have who own property that they rent/lease out is they simply collect the money and spend it as they please on anything and everything besides on the property that they are renting/leasing out. So when the time comes that something needs to be repaired/replaced, or if a tenant moves out and leaves damage, they've not put any money aside to fund such repairs and what happens often, as such with my friend with the condo, is they pass the expense onto the next tenants in the form of higher rent/lease. I personally think that's bs.. If you own or you know someone who owns their own apartment building, single family dwelling, building, etc. and who rents/leases it out, you will know how much money they are really bringing in. It's amazing how much money the people I personally know take in from rent/lease.

Businesses fail all the time... everyone has a different idea on how to run one and many may be reluctant landlords... or at least they were.

A landlord that doesn't take care of business will eventually be out of business.

[FC76-81]

Originally Posted by Ultrarunner

Businesses fail all the time... everyone has a different idea on how to run one and many may be reluctant landlords... or at least they were.

A landlord that doesn't take care of business will eventually be out of business.

And the few landlords that don't take care of business but actually still don't go out of business become slumlords.

[Ultrarunner]

Originally Posted by FC76-81

And the few landlords that don't take care of business but actually still don't go out of business become slumlords.

The true slumlords eventually get their comeuppance... it has happened all around the Bay Area...

But, renters have the power of the purse... the customer chooses who to do business with and the renter is the customer.

Landlords could not exist without Renters...