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Ok so maybe the answer should be to deregulate utilities and just let them float on the market, how would you like that? Then you could have the city issuing easements across your land to run 6 different gas companies lines. Let me know how you like 6 power lines going across your property and $300 AC electric bills, let me guess you will then carefully craft a disingenuous argument that favors your gripe because now its you getting hit with a big bill.
I would love to have a $300 electric bill but that won't happen again ever and our utilities here are pretty low compared to the east coast.
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Originally Posted by pittsflyer
Regardless of how you label it I have seen rental units within a 10 mile radius all roughly the same prices which were all around 60% of the median income. That leaves people at the median income with only %40 of their income for EVERYTHING ELSE. The rates barely varied by $50.
You could argue semantics but when it boiled right down there is functionally no difference between utilities and rent prices.
Maybe start charging people with collusion and market fraud?
Median household income in AZ is $51,492 while the average apartment rent is $1,027 that's only 24%. My highest unit is only $323 higher than that in an upper middle class neighborhood where the median income is in the $80k range. The problems with ideals like yours are they aren't grounded in reality. Are you even out of college yet because I don't think you truly understand how things work.
Its not just the current real estate holders who are the issue but also the sellers who are listing at crazy prices. I don't know why any investor in their right mind would pay the asking prices for these rental properties and that is likely the true root cause in a capitalist system.
Who the he!! is paying these asking prices for multi unit properties that cause you to need to get every last cent out of renters just to make a few bucks. The only reason these crooks can make so much is because you all are engaging in a bid war against each other.
I figure I am going to get involved in real estate that interests me (specialty real estate like vacation rental chalets in the mts of an area that is not even up and coming yet) and then put the rest in index funds because in reality the buying opportunities are not there.
But at the end of the day its not a tenants fault that a land lord GROSSLY over paid for a property.
If buyers start putting the screws to sellers and refuse to buy for anything close to what they are asking and chose instead to invest in something totally different these greedy sellers will be forced to do something because the taxes and problems will eat them alive when they are trying to move to Hawaii and enjoy retirement.
I have even thought of business ventures where I hire seedy looking people to have fake fights and gun battles on the streets of the area a client is interested in, drive bys with blanks etc. Make the area look seedy as crap without actually doing anything strictly illegal.
A good friend just sold an Oakland triplex for 400k... it was an older building and his relative was in ill health and so fed up with renting that two of the units were kept empty... she would rent at a very reasonable rent but would soon find trash, strangers and the final straw was when the main sewer was stopped and when the line was opened it was full of hypodermic syringes... it took 3 months to get that tenant out and cost 2k in lawyer fees and all she was charging for two bedroom was $600... which is a bargain... even in 2012.
I know other Mom and Pop owners that simply no longer rent... especially if they live in one of the units... it is just not worth it and if they let in someone at below market rent they have shot themselves in the foot as 2% of 400 is $8 where market might be 1200 and $24 allowable increase.
Most of those I know are small time owners... the big guys with resident managers and corp lawyers and large complexes operate differently... the question each year is not if the rent is going up but by how much is it going up...
Remember a rental can only rent for what the market can pay... a landlord can ask whatever they want but there are thousands of other rentals so if it is too high... it will stay vacant.
A good friend just sold an Oakland triplex for 400k... it was an older building and his relative was in ill health and so fed up with renting that two of the units were kept empty... she would rent at a very reasonable rent but would soon find trash, strangers and the final straw was when the main sewer was stopped and when the line was opened it was full of hypodermic syringes... it took 3 months to get that tenant out and cost 2k in lawyer fees and all she was charging for two bedroom was $600... which is a bargain... even in 2012.
I know other Mom and Pop owners that simply no longer rent... especially if they live in one of the units... it is just not worth it and if they let in someone at below market rent they have shot themselves in the foot as 2% of 400 is $8 where market might be 1200 and $24 allowable increase.
Most of those I know are small time owners... the big guys with resident managers and corp lawyers and large complexes operate differently... the question each year is not if the rent is going up but by how much is it going up...
Remember a rental can only rent for what the market can pay... a landlord can ask whatever they want but there are thousands of other rentals so if it is too high... it will stay vacant.
I guess my area is kinda unique then in that it has boom and bust cycles and if someone bought in LOW what they do is just that, they list at a sky high rate and literally just sit on the property and let it stay vacant because they own the units out right because they bought at the bottom of the market.
There have been enough cycles now that a significant amount of property is held by people that don't have to rent it out. It is creating a very serious situation for the city dealing with VERY extreme vagrancy issue that the police can no longer deal with.
The city has just instituted a token blight fine for land owners who sit on properties and fail to maintain either code or astetics but the fee thus far is not modifying behavior, not sure what they are going to do because the rents are at around 50% of median income and that's for a shabby semi run down place. if you want something that is decent its BIG money.
Cost are either passed on or the service is no longer offered.
This is especially true with 1-4 unit properties and many single family rentals are going the way of owner occupancy...
Think about it.
A single family home built in the 1920's goes for 500k in my city... in order to make a go of it the rent would have to be $4000 or more each month and a lot of these homes are rented in the $1600 to $2500 range or half to a third of the cost for someone paying 500k.
If rents do not keep up units will be taken off the market like in New York with Co-op property or go condo... and single family will simply sell to someone intending to live there.
Cost are either passed on or the service is no longer offered.
This is especially true with 1-4 unit properties and many single family rentals are going the way of owner occupancy...
Think about it.
A single family home built in the 1920's goes for 500k in my city... in order to make a go of it the rent would have to be $4000 or more each month and a lot of these homes are rented in the $1600 to $2500 range or half to a third of the cost for someone paying 500k.
If rents do not keep up units will be taken off the market like in New York with Co-op property or go condo... and single family will simply sell to someone intending to live there.
That's exactly what is happening here and then everyone is angry and confusued about why there is so much vagrancy and crime (murders, car and home break ins and TONS of theft). The spike in the last year or two has been so prolific that it can no longer be ignored.
City/State is still not dealing with it, prisons are full up and the state just significantly raised the thresholds for felonys so that if someone busts out your car window and steals stuff the value has to be HIGH (I think its well over 5 figures to even get the police attention).
Then you have all these people sitting on vacant properties scratching their heads and whining, but but but I OWN this property ... OK, do you want a cookie.
We have castle doctrine but the criminals are just as armed and more hardened than you are so you better make sure you know what you are doing, police don't typically respond unless there are shots fired and/or a dead body. To much other violence in the city for them to respond too that is more serious.
But most areas may not be nearly as captive as here and people can just move along to greener pastures without significant barriers.
Not sure how things work in NYC, I imagine NYC is even more expensive with even more violence and homelessness due to the excessive costs of housing? Do you just get used to it and accept a few losses from time to time due to break ins and thefts?
The market decides the rents. If you can't afford rent in an area you have to move to where you can afford it. I grew up in a midsize city in the northeast. I had to live in a one bedroom apartment that I did not like in a so so area. I chose to do that to be near my family. I lived there for 13 long years. The city does have rent control so every year the rent would go up 3% or so, guaranteed. They didn't have to raise it, but they did because they were afraid if they didn't that the rents would be too low. but it was fair market value. $700 rent goes up about $20 a year, in 5 years you are paying $800 or more. This was back them.
I decided to move to Southeast Florida. It wasn't too much cheaper but I could live in a much better area. I lived in one place for 2 years and in another for 3 years, no rent control and the rent did not go up because I am a good tenant and they wanted to keep me.
Them I bought an older small mobile home but the lot rent went up 3% a year, no rent control, and in 10 years I would have been paying more than it cost in lot rent than to rent a nice apartment. I was lucky to sell it.
I then moved in with roommates while I looked to buy a home. It was a bad situation. I was looking in SW Fl because I could not afford the other coast. Then I moved to SW FL with a roommate and the rent there was absurdly low. A really nice half a duplex with a 2 car garage a large master bedroom with a walk in closet and master bath, and I had a large room and used the other bathroom. It was about 1200 square feet on a canal and the rent was only $850 a month plus utilities , my share with utilities was $500. Again bad luck with roommates, but I found a house and bought it a few months later. I was lucky I think I got the last inexpensive home in the area that was move in ready, outdated, but livable. Now my mortgage costs less than what a studio apartment would rent for.
So rent control in not necessary everywhere and can cost you more than free market. Where you decide to live determines how much you pay. If there was rent control in Florida the first 5 years then my rent would have gone up because the LL would be worried that if the area rents went up they could not increase to keep up with the demand.
How can anyone serious propose controlling rents without controlling expenses?
Taxes go up 2% every year plus the voters add all kinds of special assessments that get tacked on.
Waste Management provides less service but rate go up every year and city water/sewer have had huge spikes...
Cost of maintenance keeps going up... just had new roof on a duplex that was 22k and the cost was high as city no longer allows shake.
Wages in my city are phased to hit $15 with mandatory sick leave...
Yet... Housing Providers are limited to a 1 to 2% annual increase?
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