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I'm on year 3 of renting my apt from a corporation (NOT a private landlord). Do ALL apt complexes that are owned by corporations automatically increase yearly for everyone, meaning unless you can afford it, you will eventually be forced to move out due to no longer being able to afford it?
What's a renter to do then? I guess no one can live in an apt for too long then unless they got a financial windfall to be able to keep affording the increase. Mine increases about $100/year.
Corporate apartments have accountants that run the "price elasticity of demand" calculations and will raise prices as long as demand equals or exceeds the price). They really don't pay much attention to how often you pay on time and how little you call maintenance. All they know how to do is count beans. They answer to investors or to someone else that answers to investors.
Private landlords, on the other hand, pay a lot of attention to how little trouble you cause and weigh it much higher. They don't have to answer to investors, they are the investor. Consequently, good tenants can have better luck renting from private investors.
Corporate landlords also know (at least they have a pretty good average estimate) how much it costs tenants to move (part of the calculation above in post #2) and how many moveouts they can expect under a given rent increase. It has been said that Walmart knows just how long customers will stand in a checkout line, and staff their checkouts accordingly. Corporate landlords also know how much they can raise rents before tenants move out.
The ultimate goal is to maximize profit and NOT to maximize occupancy - at full occupancy there is SOME non-zero rent increase which will maximize profit.
........ Do ALL apt complexes that are owned by corporations automatically increase yearly for everyone, ......
ALL? There is very little in life where all of anything always does the same thing. Each apartment management, be it a corporation or a private landlord, analyzes what the going rate is and calculates whether or not an increase will make tenants move out. If tenants move, then management figures out how much it will cost to have a vacancy.
Your management company, OP, has figured out that a $100 increase keeps them at market rate and will not make too many tenants move out. It appears that in your case, they don't care whether or not you can afford the increase. They have probably looked at what everyone else in the area is charging and know that you will have a hard time finding a different rental that gives you a large enough saving to make it worth the effort of packing and moving.
I lived in an apartment complex that was owned by a huge corporation for 3 years. In that 3 years, my rent was never increased. Of course, my rent was always paid on time, and I only called maintenance once in those 3 years, when the unit above me flooded.
So no, not all corporate landlords will always take an annual increase. But many will.
Also those rent increases cover the move in specials. When your $900 rent amount on your 100 unit apartment rent goes up $100 and 5 people move out and that $900 "move in special" banner goes up, the 95 remaining tenants are subsidizing those 5 new tenants or the vacancy loss
Last edited by Electrician4you; 12-28-2015 at 11:27 AM..
Also those rent increases cover the move in specials. When your $900 rent amount on your 100 unit apartment rent goes up $100 and 5 people move out and that $900 "move in special" banner goes up, the 95 remaining tenants are subsidizing those 5 new tenants or the vacancy loss
That makes sense to raise the rent if a lot of people moved out during the year but I can say I know of only one person who moved out in 2015 so that could work in my favor.
I lived in an apartment complex that was owned by a huge corporation for 3 years. In that 3 years, my rent was never increased. Of course, my rent was always paid on time, and I only called maintenance once in those 3 years, when the unit above me flooded.
So no, not all corporate landlords will always take an annual increase. But many will.
You make it sound like it's a bad thing to call maintenance more than once while renting. Sometimes things happen beyond my control which is why maintenance was called to address the situation. This year I called them three times because the bathroom above me flooded, the toilet in my bathroom was leaking, and the heat was not coming on once the weather changed. So if you only called maintenance once in 3 years then consider yourself very lucky.
This is why you need to be good at your job and compel them to subsidize your rent otherwise move somewhere else. I would never move to a high cost of living area unless my employer was paying me enough to cover all my living expenses AND increase my standard of living from where I was, otherwise why would I move there. If more people did this you would see the market change.
Personally I have never lived in any rental where the rent did not increase from lease renewal to renewal (and I have never rented from a private landlord, it's all been corporations since that's what is prevalent in my area).
Some of the increases were less, but they all went up. The one that was the most ridiculous to me was an increase of over $100 a month PLUS another $40 a month for some valet trash pickup BS. They didn't just do it to me though. A friend of mine who lived in the same complex had hers go up by the same amount. I think they upped it so much to help pay for a ton of renovations they did on the exterior (siding/painting) and the "clubhouse" area. Of course they did nothing to the interior. It was still outdated and crummy.
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