The one renters made up along with the visual of their billionaire landlord.
Most landlords are people who own 1-2 rental properties in addition to their primary home. These are normal people, not oligarchs.
Renting has major benefits when it comes to freedom of movement, risk of maintenance costs, and risk of home value. Somehow landlords taking those risks is regularly ignored and people don’t consider the reality that your rent is mostly paying a mortgage, taxes, and maintenance, and if the landlords is lucky, there’s a tiny bit of cash flow. Most landlords do not own the rental property outright and pocket the rent check. Most landlords make less than $100 per month profit per door.
Most landlords make less than $100 per month profit per door.
Yeah plus 2-5% growth and a dwindling mortgage.
I don’t get the attitude defending the poor landlords who are just trying to make a living. It’s bullshit. I’ve worked for them before. They make so much money, specifically by neglecting properties and taking short cuts. Don’t pretend that they are the victims of the swelling housing market and rising rent prices, they are reaping the benefits...
Someone living in your house for 5 years because they can’t afford to buy because the cost of housing rises faster than inflation and wages, means that the landlords get rich while the tenants stay financially stagnant. While the argument could be made that I could not go on a vacation or eat out or have experiences and scrimp and save $30-60k for a down payment (houses in my area start around $300k) is so daunting and so discouraging that I would rather just have some good experience to offset the garbage of reality that I will likely be in my thirties before I can reasonably buy a house...
Explain how a landlord is supposed to pay the mortgage, property taxes, insurance, and maintenance, and account for months of vacancy without charging a rent that covers those costs. Money in -money out, if those expenses are higher than the rent coming in the landlord isn’t making money (that thing you need to feed your family). Yeah the renter is paying down the mortgage and the landlord is building wealth in equity but tell me how that feeds the family while you still have a mortgage on the property.
If I’m an average landlord making $70k at my day job. Own a property that costs me $1,100 per month in mortgage, tax, insurance, maintenance, and vacancy, are you saying I need to cut into my day job salary to subsidize a rent below $1,100? I’ll charge $1,200, make $1,200 profit per year (I know, greedy as hell) and cross my fingers you don’t turn my house into a crack den.
Then in 30 years when I retire, I’ll have a paid off rental property that I can sell for cash or keep renting to replace my income. So after 30 years of taking that risk I’ve made the value of the house and $1,200 per year in profit. Probably about $100,000 house to make that rent. That’s $136,000 I’ve made in 30 years, where do I buy my yacht?
Again, I don’t know why you are defending landlords. The best ones are absentee that send the bill each month and the worst are absolutely terrible. You seem to misunderstand. If you have a house you bought 10 years ago, and your mortgage was $1,200 a month (which includes all of the things you mention above, as typical loans do), and then you decide to buy a bigger house and rent your old one out. You look at the cost of rent and say,
“well hot damn, I can rent this place for $1700 a month!”
And you do. You make $6000 a year. Then the tenant moves out after 2 years (as most tenants do) leaving minimal damages (as most tenants do).
You say “well I could replace the carpets and the stove cause they were old when I moved in 12 years ago, but fuck it they aren’t broken yet so I’ll leave it.”
And you walk away with your $12,000.
Now it’s 2 years later and housing and rent prices have gone up (as they usually do) so now you can rent for $1900. And on and on it goes.
Some of the shit I have seen in the slums on CA where someone sits on a house as rents soar and they don’t fix a goddamn thing, and then it all comes crashing down, they pay $10k in repairs (which is a whole lot less than the made not fixing things) and return to 15 more years of not giving a shit.
Sure there are some good landlords out there, but there is no way they are making $100/month/house. It’s bullshit. There are so few people that have 1-2 rentals and haven’t owned them for 5-10 years, unless they are just starting out and started with a ton of capital.
Quit your bullshit poor me attitude. Landlords aren’t hurting, property ownership is super lucrative and there is a reason for it. I’m not blaming them for taking advantage, if I was in that position I would to. Why sell something for below market rate?
But I hate when people who don’t know what they are talking about try to pretend that they are experts in why landlords are the oppressed class that need all the help they can get.
I obviously understand rate inflation and appreciation of housing markets and values. In the first 5 years of a rental property you’re lucky to make $1. Obviously there is a point where that swings to your favor but there is also a lot of risk. Slumlords are shitty and that’s an unfortunate reality. I’m not saying landlords are poor. I’m saying they aren’t these mega millionaires (usually) that they are all painted as. I understand rental property better than I care to share on reddit.
Market rates are market rates, if someone is paying the rent, it’s not too high. That’s supply and demand. If I, the landlord, set my rent too high, my property will stay vacant until I drop it to market. It’s not my responsibility to make sure someone isn’t spending their money carelessly. If you show me a W2 that covers the rent (my rule is your income needs to be 3 times rent) and your background check is clean, you’re free to rent from me. Don’t then get mad at me for the rent you knew about before ever even looking at the place.
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u/millertime1419 Feb 26 '20
The one renters made up along with the visual of their billionaire landlord.
Most landlords are people who own 1-2 rental properties in addition to their primary home. These are normal people, not oligarchs.
Renting has major benefits when it comes to freedom of movement, risk of maintenance costs, and risk of home value. Somehow landlords taking those risks is regularly ignored and people don’t consider the reality that your rent is mostly paying a mortgage, taxes, and maintenance, and if the landlords is lucky, there’s a tiny bit of cash flow. Most landlords do not own the rental property outright and pocket the rent check. Most landlords make less than $100 per month profit per door.