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Old 05-20-2020, 08:03 PM
 
Location: Colorado Springs CO
9 posts, read 5,906 times
Reputation: 36

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Quote:
Originally Posted by BornintheSprings View Post
Affordable housing is sorely needed all over the US. People shouldn't be spending more than 20 percent of there income on rent.
Let's call it what it is. "Affordable Housing" is euphemism for "Subsidized Housing". Get the government to pay for some of it. Just remember, the government is simply taking money from one group of people to give it to other people.

For most working people, housing would be easily affordable if they didn't spend their hard-earned money on unlimited mobile data, $150 cable/internet, car lease, nail salon, sports betting, dinners out, etc. If you are poor, you have to eat a lot of rice and beans to stay healthy, stay fed, and afford your rent.
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Old 05-20-2020, 08:28 PM
 
6,042 posts, read 8,230,808 times
Reputation: 6472
Quote:
Originally Posted by Even_Stephen View Post
Let's call it what it is. "Affordable Housing" is euphemism for "Subsidized Housing". Get the government to pay for some of it. Just remember, the government is simply taking money from one group of people to give it to other people.

For most working people, housing would be easily affordable if they didn't spend their hard-earned money on unlimited mobile data, $150 cable/internet, car lease, nail salon, sports betting, dinners out, etc. If you are poor, you have to eat a lot of rice and beans to stay healthy, stay fed, and afford your rent.
I disagree to an extent. When you can find practically identical homes and apartments in other parts of the country for 25-50% of the price as here, I think it is entirely possible for more affordable housing without it being subsidized. While certain people benefit from the ever-rising prices, it is not inevitable or necessary that we let the market operate that way.
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Old 05-21-2020, 06:50 AM
 
936 posts, read 587,382 times
Reputation: 1435
Quote:
Originally Posted by otowi View Post
I disagree to an extent. When you can find practically identical homes and apartments in other parts of the country for 25-50% of the price as here, I think it is entirely possible for more affordable housing without it being subsidized. While certain people benefit from the ever-rising prices, it is not inevitable or necessary that we let the market operate that way.
And that is why you probably want to move to those parts of the country where your "skills" can get you the most bang for the buck.

Sorry- it may not be CO.
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Old 05-21-2020, 07:05 AM
 
936 posts, read 587,382 times
Reputation: 1435
Quote:
Originally Posted by Even_Stephen View Post
Yes. You would too if you were a landlord. You charge as much as you can. If what you ask in rent is too high for the market, it will sit empty. So if I "jack up the rent at a time like this", the tenant has a choice: Pay up, move, or negotiate.

If you think that being a landlord is such a great racket, why don't you try it? It's not hard *at all* to get started, though there is a lot of financial risk. Get a mortgage, buy a house, put up a For Rent sign. The trick is to actually make money at it.

Making money at it isn't really hard, either. You just have to work hard. You have to keep the place nice so that you can attract nice tenants. Nice tenants take care of the place and pay rent on time. But how to find nice tenants? Mortgage company expects a payment on time every month. El Paso County expects property taxes on time. Insurance company expects payment on time. Shouldn't the landlord expect the same from the tenant?

Or, you could just buy a dump, put as little as possible into it, and rent to anyone with a pulse. You can make money this way, too. I can't, though. Because I don't want to own dumps. And I don't want the headaches of chasing rent from people who can't/won't pay.

Personally, I like to provide nice places to nice tenants. But it doesn't come cheap either to me nor to the tenant. I don't set the maximum rent - The free market does. If I ask too much, it sits empty. If I ask too little, I can't pay all the expenses. If what I can get in rent doesn't cover expenses, then I'm out of business.

Again, give it try if you think you can do a better job.
As an ex-LL you are correct on all counts. I only did Section 8 (aka Suction 8) one time and learned a huge lesson with that one (!)

If you are a good LL your house should not look any different than others on the street- well maintained etc...

The virus will weed out the over-extended AirBB, VRBO etc.. owners who went into heavy debt buying properties. They expected the rent to pay the mortgages and have no cushion for an empty property.

Some expected the good times to never end but they always do.

The good news is maybe this will bring some lower-priced properties back onto the market when the newbie LL's bail and have to sell.
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Old 05-21-2020, 02:39 PM
 
Location: Colorado
15,090 posts, read 9,394,316 times
Reputation: 27908
Quote:
Originally Posted by Even_Stephen View Post
Yes. You would too if you were a landlord. You charge as much as you can. If what you ask in rent is too high for the market, it will sit empty. So if I "jack up the rent at a time like this", the tenant has a choice: Pay up, move, or negotiate.

If you think that being a landlord is such a great racket, why don't you try it? It's not hard *at all* to get started, though there is a lot of financial risk. Get a mortgage, buy a house, put up a For Rent sign. The trick is to actually make money at it.

Making money at it isn't really hard, either. You just have to work hard. You have to keep the place nice so that you can attract nice tenants. Nice tenants take care of the place and pay rent on time. But how to find nice tenants? Mortgage company expects a payment on time every month. El Paso County expects property taxes on time. Insurance company expects payment on time. Shouldn't the landlord expect the same from the tenant?

Or, you could just buy a dump, put as little as possible into it, and rent to anyone with a pulse. You can make money this way, too. I can't, though. Because I don't want to own dumps. And I don't want the headaches of chasing rent from people who can't/won't pay.

Personally, I like to provide nice places to nice tenants. But it doesn't come cheap either to me nor to the tenant. I don't set the maximum rent - The free market does. If I ask too much, it sits empty. If I ask too little, I can't pay all the expenses. If what I can get in rent doesn't cover expenses, then I'm out of business.

Again, give it try if you think you can do a better job.
Dude.

Just because I am not currently a landlord doesn't mean I know nothing about it. My ex is renting out the house we owned together, which I'm just thankful I washed my hands of my stake in it during the divorce. I've rented from private owners in the past who ended up being on the level of "like family" friends to us, over the years.

What I consider to be something of an issue HERE, is that privately owned and rented out homes with no middle-man property management company skimming a cut, are rare in these parts. When I was in Iowa and Washington state? Because I rented from the people who actually owned the home, they were, as I said, happy to have a good tenant who always paid on time, caused no complaints from neighbors, and took great care of the house. So they did not raise my rent on renewal. I have NEVER experienced that with a PM company. You can be the perfect tenant and they do not care, they will raise the rent and if you move out, fine. They'll raise it even more and get someone new in there, and they don't care if that tenant takes care of the place or not. And if a house stands empty, as I said, it's no big loss on a PM company, they have a portfolio of hundreds, it makes more sense for them to keep the ENTIRE market going up, up, up, than to make sure any one, or few, or some properties are always rented.

The rents have been rising FAR faster than any of the costs necessary to pay for, or keep up, the housing stock of which we're talking. Unless the owners are continuously borrowing against an ever-increasing market value of all of the properties? Is that how it works? Keep the stock leveraged, so as to continue to acquire more homes, or what?

And I'll tell you something, the first house I rented when I moved here, I was SHOCKED at its condition. I was moving from another state, and just wanted a home to arrive at, so I took the PM's word for it with the photos and committed to it sight-unseen. Figured, even if it's not great, I can move in a year when the lease ends, so it's fine. Holy crap. I sometimes wish I'd searched up the owner and talked to him about the condition of his property. Tenants had badly painted it, kids had left "art" on walls in bedrooms, a lock had been installed on the OUTSIDE of one of said bedroom doors. Trim was busted up, doors broken, cords on outside of home chewed by dogs, and the cabinets left full of mouse droppings. They'd turned off the heat and left on the water over the winter, causing a leak that collapsed a ceiling which they only discovered 2 days prior to our arrival. They'd left the place sitting empty and not even checked on it for a good 5-6 months before that. There was an unpaid and past due water bill that had to be paid before I could get water turned on in my name. And someone had tried to turn space in the basement into "a nail salon" or something (?) and they took what WAS the dryer vent, and ran a bathroom extractor fan to that egress, and chucked the dryer vent hose over a low wall into the utility closet next to the furnace. To blow dryer lint...all around the furnace... On top of that? We discovered a minor gas leak in there, too, and when my son smelled it and called it in, the utility sent a guy out who said, "Oh yeah, we've been out here before. See, this is marked and tagged. Seems no one ever fixed it."

So the house was a fire hazard on several fronts, it half makes me wonder if the PM company was scheming for some kind of insurance fraud (how would that work? I don't know.)

So what I'm getting at, is that these property management outfits, when they run most of the rental stock in a location, it's bad for renters, but beyond that they don't always do right by the owners, either.

I have rented, and I have owned. I prefer to rent, much of the time, because I don't like the commitment of owning. I like knowing that if I have a reason I need to move, it's as simple as getting through a lease. I don't want to be a landlord, it seems like a huge hassle. But I don't think it helps encourage good tenant habits, to treat good tenants like they are the same as the kind who cause problems. As though all renters are basically scum to be looked down on.

And honestly the entire housing market, sales and rentals both, has skyrocketed out of proportion to any other metric, and I frankly don't see anything that justifies it. I think that it is artificial, it's a manipulated market. You're right, if you price the rent "too damn high" (wonder if anyone would get that reference)... If the market is functioning the way a market should, then the product won't move. You'll have vacant units. What happens when for some reason a city is full of vacant housing and homeless people? Homeless people who actually have jobs, and don't splurge on stupid things, but still can't afford the housing? Do you know that we have far more vacant homes in this country than we have homeless people? It's the truth. And the majority of people who are technically in "poverty" by the numbers, work full time or more. No amount of eliminating frivolous spending can make things work when necessary expenses go up far faster than wages. And the "free market" gets jacked when competition is replaced by collusion and/or monopoly, with no regulation to keep it in check.

Look, maybe you don't remember being a kid starting out in the world. Or maybe your parents paid your way, or you had full ride scholarships, or whatever, I don't know what your story is. But when I was starting out, I was able to find a cheap apartment, granted not a very NICE one, it was kind of a crap-hole place to live, but it was a start, for an amount I could afford on minimum wage. Yeah, I had to tighten my belt, but I could make it. Now? It's not even JUST a matter of what they could afford if they spent their money on nothing but essentials, they've got to make a certain multiple of the rent just to qualify and get in the door.

But what you've got in a rental property is an INVESTMENT as you well know. I'm an investor, too. I just don't happen to invest in housing. It is a hallmark of investing, as opposed to "saving" that investments involve risk. It will not always be good times for your investment to be making you money, sometimes it will lose money. And if you are a smart investor, rather than spluttering angrily in disbelief when world events happen that make your usual game not-so-good, your sure thing not-so-sure...you look for the opportunities to be had, and hedge your bets. Which is why my financial situation has been right as rain despite everything going on in the world, and my own landlord has no cause for grief, at least not about me.
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Old 05-25-2020, 09:06 AM
 
Location: Colorado Springs CO
9 posts, read 5,906 times
Reputation: 36
Mr. Spork, do keep in mind that the price of real estate in The Springs is (or was) rising faster than nearly any other metro area in the country. It isn't as if real estate prices were rising slowly but rents rising fast. Both are rising fast.

And, yes, it is very common for real estate investors, both large and small, to keep all properties fully leveraged. Why? Reason 1: Buy more properties. Reason 2: If a property has a mortgage lien on it, it becomes "judgement proof" in case of a lawsuit. Because any judgement against the property is second in line to the lienholder. So, it keeps lawyers from bothering to sue. Nothing to collect.
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Old 05-25-2020, 09:27 AM
 
936 posts, read 587,382 times
Reputation: 1435
Quote:
Originally Posted by Even_Stephen View Post
Mr. Spork, do keep in mind that the price of real estate in The Springs is (or was) rising faster than nearly any other metro area in the country. It isn't as if real estate prices were rising slowly but rents rising fast. Both are rising fast.

And, yes, it is very common for real estate investors, both large and small, to keep all properties fully leveraged. Why? Reason 1: Buy more properties. Reason 2: If a property has a mortgage lien on it, it becomes "judgement proof" in case of a lawsuit. Because any judgement against the property is second in line to the lienholder. So, it keeps lawyers from bothering to sue. Nothing to collect.
And smart LL's with multiple properties will have them in an LLC to shield their personal assets.
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Old 05-25-2020, 10:10 AM
 
Location: Colorado Springs
3,698 posts, read 2,931,598 times
Reputation: 4559
There are many hundred of PM companies out there, if not thousands, in the region. To think they are all manipulating prices is, IMO, a bit of a stretch. Prices have risen here because it is a reasonably desirable area that rates well on a number of quality of life factors.

Cos has long been and continues to be a popular stop over for military assignments and in many occasions, military families retain ownership of properties once they transfer out. Often with the intention of returning in the future for retirement. Cos has also has been a tourist destination all of its existence. Well healed eastern, then southern, and more recently west coast transplants move here with extra capital and investing locally in real estate is a convenient way to use those funds.

There are still more affordable neighborhoods in the region. Maybe not cheap, ,but certainly less expensive. But they aren't always in the most desired areas. I dare say this is situation is fairly consistent with nearly any city in the nation. Is Cos real estate overpriced for the area, perhaps. Are there places you can get more home for less, absolutely. But there also are places where you pay way more for less. If the recreation and job opportunities of the area align with your personal goals, you could certainly do worse than living here. But the area is not an end all, be all for every lifestyle or career path. Evaluate and chose carefully.
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Old 05-26-2020, 03:45 PM
 
Location: Colorado
15,090 posts, read 9,394,316 times
Reputation: 27908
Quote:
Originally Posted by Even_Stephen View Post
Mr. Spork, do keep in mind that the price of real estate in The Springs is (or was) rising faster than nearly any other metro area in the country. It isn't as if real estate prices were rising slowly but rents rising fast. Both are rising fast.

And, yes, it is very common for real estate investors, both large and small, to keep all properties fully leveraged. Why? Reason 1: Buy more properties. Reason 2: If a property has a mortgage lien on it, it becomes "judgement proof" in case of a lawsuit. Because any judgement against the property is second in line to the lienholder. So, it keeps lawyers from bothering to sue. Nothing to collect.
I am not a Mr, Mister.

I have been thinking that the rapidly rising real estate market prices is another bubble situation, as well. I remember 2008. I knew a lot of people who wanted to sell homes, who were way underwater and could not.

If I may ask those who have history as landlords, how did you fare in 2008? Did a strategy of continuous leveraging of your investments with mortgages, and the bottom falling out on home market values, cause you any grief? Or have you found ways to reap all of the benefits and eschew most of the risk (other than the occasional vacant unit?) I am just curious.

I have been extremely hesitant to buy a house, personally, for a few reasons. And I have no interest at all in being a landlord. So I admit, I have not given it much thought.

Frankly, I would not want to live a life where I was seriously concerned about being sued. But then, I don't relish conflict, and I'd have a hard time dealing with people, families, and the roofs over their heads as just a matter of "business." In conflicts where I am in the right, I'd be stressed just having to deal with advantage-taking type people, and in conflicts where I am in the wrong, I'd have a hard time resolving my ethics with looking out for my bottom line. And yeah, I know...these trifling humanitarian sensibilities of mine are likely to prevent me from ever becoming rich. Well. Aside from a particular inheritance...but that is neither here nor there. Point being, I'll likely buy a house when I'm in a position to find the one I want to reside in for the rest of my life. As I still have a point where I'll move to another state for a few years and move back...that'll be a while.

Incidentally I've been watching rental prices in Phoenix, AZ, where I'm expecting to move late next year, and they've been going up too and are in a similar range to Colorado Springs, which I find a bit surprising. I find this to be a much more desirable place to live, personally. I am going to Phoenix out of necessity, not choice.

Phoenix: Somebody's answer to the question, "How many shades of beige exist?" Sheesh.
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Old 05-26-2020, 04:21 PM
 
Location: Colorado Springs CO
9 posts, read 5,906 times
Reputation: 36
Quote:
Originally Posted by Sonic_Spork View Post
I am not a Mr, Mister.
Touche'. However, I'm not a Dude. A man, but not a Dude.

I did fine during 2008. Many others did, too. Though many did not. One has to have cash reserves to cover vacancies. But people have to live somewhere. Often, homeowners become renters in hard times. They can't make the mortgage, but can afford to rent a smaller or less desirable place. This makes for an opportunity for many landlords.
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