The "Small Landlord": ~Myth or Reality~
October 3, 2023 11:22 AM Subscribe
Pity the Landlord: How "Oppressed" landlords have taken up the language of social justice in their fight against rent regulations: "But Eccles takes it a step further. Oppression of landlords, he argues, is a racial justice issue...Eccles’s widespread media presence is no accident. In 2019, he became one of the public faces of Responsible Rent Reform—a faux-grassroots group backed by the Rent Stabilization Association (RSA), the largest landlord organization in the state—which has set about weaponizing the stories of a dozen 'mom-and-pop' landlords to undermine rent regulations"
Related Podcast: Citations Needed: How Real Estate-Curated 'Mom & Pop Landlord' Sob Stories Are Used to Gut Tenant Protections (Transcript)
Related Podcast: Citations Needed: How Real Estate-Curated 'Mom & Pop Landlord' Sob Stories Are Used to Gut Tenant Protections (Transcript)
This one's tricky. Mom & Pop landlords do exist. My mom and pop, for example, rent out the house where my grandma lived for many years before her passing in 2011. They do this out of general reluctance to sell the house, I'm pretty sure they haven't raised the rent in 12 years, and I get the impression their relationship with their tenant is generally good for everyone involved.
They also had a bad tenant right out of the gate, who stopped paying rent after the first month, dug in his heels, and took a year and thousands of dollars in legal fees to evict. That sucked way more than it had to.
That said, my parents are in the vast, unbelievably tiny minority of landlords, and their interests couldn't be further removed from those of the mega-corps buying up real estate and driving rents up. Part of me wants to ask them to record a video in support of tenant protections, because I'm guessing that the few actual "mom and pop"-style landlords out there don't support any of this astroturfed nonsense.
posted by Mayor West at 11:49 AM on October 3, 2023 [20 favorites]
They also had a bad tenant right out of the gate, who stopped paying rent after the first month, dug in his heels, and took a year and thousands of dollars in legal fees to evict. That sucked way more than it had to.
That said, my parents are in the vast, unbelievably tiny minority of landlords, and their interests couldn't be further removed from those of the mega-corps buying up real estate and driving rents up. Part of me wants to ask them to record a video in support of tenant protections, because I'm guessing that the few actual "mom and pop"-style landlords out there don't support any of this astroturfed nonsense.
posted by Mayor West at 11:49 AM on October 3, 2023 [20 favorites]
And then, there’s the plight of the tennis courts.
posted by Ideefixe at 11:55 AM on October 3, 2023 [1 favorite]
posted by Ideefixe at 11:55 AM on October 3, 2023 [1 favorite]
Thank you for posting, Windbox.
Related: the most recent CBC Cross Country Checkup "How far have you gone to secure an apartment" segment
posted by elkevelvet at 12:00 PM on October 3, 2023
Related: the most recent CBC Cross Country Checkup "How far have you gone to secure an apartment" segment
posted by elkevelvet at 12:00 PM on October 3, 2023
my parents are in the vast, unbelievably tiny minority of landlords
There's some data on landlords. In 2015, there were about 45 million rental units. Roughly half were owned by businesses and half by individual investors. There were roughly 10 million individual landlords, so (again very roughly) that means an average of 2 units per landlord. That's going to be very skewed, so probably most of them have one unit.
So from the perspective of landlords, your parents are quite typical - they have one or two units. But from the renters' perspective, they are unusual, because the majority of renters live in units owned by companies or landlords who own many properties. (These numbers may have changed since 2015, but mom and pop landlords are still going to be quite common.)
posted by Mr.Know-it-some at 12:02 PM on October 3, 2023 [20 favorites]
There's some data on landlords. In 2015, there were about 45 million rental units. Roughly half were owned by businesses and half by individual investors. There were roughly 10 million individual landlords, so (again very roughly) that means an average of 2 units per landlord. That's going to be very skewed, so probably most of them have one unit.
So from the perspective of landlords, your parents are quite typical - they have one or two units. But from the renters' perspective, they are unusual, because the majority of renters live in units owned by companies or landlords who own many properties. (These numbers may have changed since 2015, but mom and pop landlords are still going to be quite common.)
posted by Mr.Know-it-some at 12:02 PM on October 3, 2023 [20 favorites]
I'm generally anti-LL but in college rented for 2 years from a nice old lady renting out basically 1B studio in the back of her house for $90/week, then 3 years from a coworker/pal whose parents had bought a $185k 2B condo when he started school (they sold 25 years later for $750k).
When in Japan I rented for 5 years a 3F 1B from the LL who lived on the first floor owners unit, and his son lived in a 2nd floor apartment. Total 5-unit building took up the footprint my driveway takes up today.
So I guess I'm totally OK with rental units where the LL is living on-site.
But other than that they can go f- themselves.
posted by Heywood Mogroot III at 12:10 PM on October 3, 2023 [7 favorites]
When in Japan I rented for 5 years a 3F 1B from the LL who lived on the first floor owners unit, and his son lived in a 2nd floor apartment. Total 5-unit building took up the footprint my driveway takes up today.
So I guess I'm totally OK with rental units where the LL is living on-site.
But other than that they can go f- themselves.
posted by Heywood Mogroot III at 12:10 PM on October 3, 2023 [7 favorites]
Every landlord I've ever had had been an asshole. I know good landlords do exist. My grandparents rented out a house for a while. But it's not the norm.
posted by downtohisturtles at 12:14 PM on October 3, 2023 [2 favorites]
posted by downtohisturtles at 12:14 PM on October 3, 2023 [2 favorites]
How do rental management companies factor into all this? My SO lives alone in a small apartment complex owned by an individual but run by an astonishingly crappy management company. Reasonable maintenance is lax at best, and a few times a year they demand to do in-person walk-throughs which are inevitably followed by (false) accusations of full-time roommates.
posted by gottabefunky at 12:17 PM on October 3, 2023 [5 favorites]
posted by gottabefunky at 12:17 PM on October 3, 2023 [5 favorites]
The important point in my experiences above was that the landlord was legitimately expanding the housing supply by renting out rooms / units on their own property.
My parents rented a 3B in Salinas in the late 70s from a very nice LL couple two doors down (husband was a local doctor who picked up the house for $57,500 a few weeks before my parents arrived in town for a job transfer). This couple was not providing additional housing services, they just took a SFH off the market and rented it out for $4800/yr.
posted by Heywood Mogroot III at 12:18 PM on October 3, 2023 [3 favorites]
My parents rented a 3B in Salinas in the late 70s from a very nice LL couple two doors down (husband was a local doctor who picked up the house for $57,500 a few weeks before my parents arrived in town for a job transfer). This couple was not providing additional housing services, they just took a SFH off the market and rented it out for $4800/yr.
posted by Heywood Mogroot III at 12:18 PM on October 3, 2023 [3 favorites]
As an adult, outside of college, I have lived in 7 rental units. Of those, the breakdown was as follows:
3 were 2-unit buildings where the owner lived in the other unit
1 was a house I rented from friends
2 were multi-unit buildings owned by a landlord that I interacted with face-to-face
1 was a building owned by a property management company and all interactions were through an on-site super.
Of those, 2 of the 3 living-with-the-landlord situations were the best. Issues got addressed quickly, I formed relationships with them, it was awesome. One of them was an alcoholic nudist. That was not so great.
Of the multi-unit buildings where I knew the landlords, one was good, the other was not.
The building owned by a property management company was fine. The super tried to scam me out of my deposit when I left, but I just went straight to the management company and they gave it to me in full.
posted by grumpybear69 at 12:28 PM on October 3, 2023 [1 favorite]
3 were 2-unit buildings where the owner lived in the other unit
1 was a house I rented from friends
2 were multi-unit buildings owned by a landlord that I interacted with face-to-face
1 was a building owned by a property management company and all interactions were through an on-site super.
Of those, 2 of the 3 living-with-the-landlord situations were the best. Issues got addressed quickly, I formed relationships with them, it was awesome. One of them was an alcoholic nudist. That was not so great.
Of the multi-unit buildings where I knew the landlords, one was good, the other was not.
The building owned by a property management company was fine. The super tried to scam me out of my deposit when I left, but I just went straight to the management company and they gave it to me in full.
posted by grumpybear69 at 12:28 PM on October 3, 2023 [1 favorite]
My last landlord, a married couple, was the only decent landlord I ever had. They rented out the condo that the husband bought and lived in before they got married, and at some point I moved to the condo that the wife lived in before they got married (they met as neighbors). In the 10 years I rented from them, they timely repaired everything we asked them to and only raised our rent once, by $50, and even then the rent they charged was well under the going market rate. My biggest complaint was that the husband talked so much when he came by with a repair person that we only ever asked them to repair urgent things. When ended up buying the condo from the wife when they got divorced, which we didn't want to do, but we didn't want to face moving to a different rental with a typical landlord.
Because of that experience, I can't join the people who say that all landlords are awful. But so many of them are, even the mom-and-pop landlords, that I don't blame people who feel that way. I have certainly seen enough of them through my job. I don't particularly want to be a property owner, and I wish there were more landlords like the couple I used to rent from so that I wouldn't feel like I had to be.
posted by JR06 at 12:38 PM on October 3, 2023 [5 favorites]
Because of that experience, I can't join the people who say that all landlords are awful. But so many of them are, even the mom-and-pop landlords, that I don't blame people who feel that way. I have certainly seen enough of them through my job. I don't particularly want to be a property owner, and I wish there were more landlords like the couple I used to rent from so that I wouldn't feel like I had to be.
posted by JR06 at 12:38 PM on October 3, 2023 [5 favorites]
I've rented pretty much all of my adult life. If I start counting in 2010, I've had 8 landlords. The only two that have followed the law and not tried to exploit me or rip me off have been (1) a professional management company representing a disinterested foreign owner, and (2) a purpose-built rental building ownership company.
Every single other one has tried some sketchy stuff, either through malice or ignorance. A few have succeeded, either due to my naivete or exhaustion. Twice I've had to involve lawyers. Many tenants are bad, but many landlords lean on that as an excuse to treat all tenants as suspects. The system to resolve it all is broken (I'm in Ontario Canada).
Maybe higher interest rates and declining property values will dissuade people from taking on 'investment properties'. Maybe the fact that a GIC pulls in 5+% and doesn't ever have a broken dishwasher will be more appealing to people looking to park their money.
Not that big corporate owners are all good! But so many Rich Dad Poor Dad dipshits have treated me and my family like deadbeats by default. Feeling insecure in your own home is an awful feeling that I've experienced too many times.
posted by the one second advantage at 12:44 PM on October 3, 2023 [12 favorites]
Every single other one has tried some sketchy stuff, either through malice or ignorance. A few have succeeded, either due to my naivete or exhaustion. Twice I've had to involve lawyers. Many tenants are bad, but many landlords lean on that as an excuse to treat all tenants as suspects. The system to resolve it all is broken (I'm in Ontario Canada).
Maybe higher interest rates and declining property values will dissuade people from taking on 'investment properties'. Maybe the fact that a GIC pulls in 5+% and doesn't ever have a broken dishwasher will be more appealing to people looking to park their money.
Not that big corporate owners are all good! But so many Rich Dad Poor Dad dipshits have treated me and my family like deadbeats by default. Feeling insecure in your own home is an awful feeling that I've experienced too many times.
posted by the one second advantage at 12:44 PM on October 3, 2023 [12 favorites]
I'm going to state that the mom & pop individual landlords can be more problematic than commercial landlords. The commercial landlord can spread risk of vacancies across their holdings, whereas an individual landlord would face risk of losses if they were to ever deal with a vacancy on their unit. Individual landlords, like home owners, never want to see their property go down in value, so we get restrictive zoning lobbying at the municipal government level.
posted by DetriusXii at 12:46 PM on October 3, 2023 [7 favorites]
posted by DetriusXii at 12:46 PM on October 3, 2023 [7 favorites]
In college I rented for one year with two guys I barely knew. The landlords were three suburban dads, who owned about a dozen apartments in a building near Boston College. The previous tenants had been B.C. Guys; there were still mountain bike tire marks on the walls when we saw the place.
My two roommates turned out to hate each other fiercely, and did things like turn off the power to the building at night, or shoot a roman candle into the other one's bed as he slept. When the landlords stopped by to see the place, my messy-but-undamaged bedroom was the only good thing they found. My roomies had filled the fire exit stairs with the trash that I thought they were taking to the dumpsters for months, for example, and other joys.
I pitied those three suburban dads, and wondered how soon they sold the building: clearly it was so much more stressful and expensive and thankless than they had been lead to believe by Sunday afternoon PBS specials about getting passive income featuring Suze Orman and company.
They were in over their heads, and they hadn't yet admitted it.
posted by wenestvedt at 1:13 PM on October 3, 2023 [4 favorites]
My two roommates turned out to hate each other fiercely, and did things like turn off the power to the building at night, or shoot a roman candle into the other one's bed as he slept. When the landlords stopped by to see the place, my messy-but-undamaged bedroom was the only good thing they found. My roomies had filled the fire exit stairs with the trash that I thought they were taking to the dumpsters for months, for example, and other joys.
I pitied those three suburban dads, and wondered how soon they sold the building: clearly it was so much more stressful and expensive and thankless than they had been lead to believe by Sunday afternoon PBS specials about getting passive income featuring Suze Orman and company.
They were in over their heads, and they hadn't yet admitted it.
posted by wenestvedt at 1:13 PM on October 3, 2023 [4 favorites]
The thing about landlords isn't really whether an individual landlord is nice or whatever, it's the class position- like all bosses landlords are making money by owning and controlling capital rather than by selling labor. Some people are really interpersonally nice about it and some people choose to use the extractive relationship as a vehicle for bastardry- like any other boss- but ultimately it comes down to them extracting money by right of ownership rather than by selling their labor, and as such all landlords have economic incentives which are going to drive behaviors in response to those incentives. The thing about landlords, like bosses, isn't whether or not they're especially cruel about it but that their economic interests are in direct and violent conflict with those of everybody else.
(It's also an issue that landlords are wildly overrepresented in politics, meaning that their economic interests are also wildly overserved by politics.)
posted by Pope Guilty at 1:13 PM on October 3, 2023 [37 favorites]
(It's also an issue that landlords are wildly overrepresented in politics, meaning that their economic interests are also wildly overserved by politics.)
posted by Pope Guilty at 1:13 PM on October 3, 2023 [37 favorites]
Bring a landlord is inherently immoral.
Some individuals do it with the minimum of immorality.
We all have to make our own way in late stage capitalism and no one is pure. So the genuinely small landlords who do well by their tenants aren't behaving in a moral way they're behaving in the least immoral way that allows them to survive.
It's the landlords with more than one, maybe two at the absolute most, who need to be brought to justice
posted by sotonohito at 1:23 PM on October 3, 2023 [8 favorites]
Some individuals do it with the minimum of immorality.
We all have to make our own way in late stage capitalism and no one is pure. So the genuinely small landlords who do well by their tenants aren't behaving in a moral way they're behaving in the least immoral way that allows them to survive.
It's the landlords with more than one, maybe two at the absolute most, who need to be brought to justice
posted by sotonohito at 1:23 PM on October 3, 2023 [8 favorites]
With the exception of one apartment, all my rentals were mom-and-pop landlords (mostly just pop) in those days. Those apartments ranged from sketchy but affordable to nice but a huge chunk of my income (just how many shifts I can pick up to cover rent this month?).
One landlord was a busybody and would police his tenants about their habits. One couple never returned my security deposit even after my place was destroyed by a tornado. Another one didn't fumigate an adjacent apartment so I'd go to sleep with roaches everywhere. The nicest one was too nice to me, a callous and callow 25 year old then, and ousted me with good cause. (I was a good kid, she said, but too irresponsible.)
posted by Kitteh at 1:25 PM on October 3, 2023 [1 favorite]
One landlord was a busybody and would police his tenants about their habits. One couple never returned my security deposit even after my place was destroyed by a tornado. Another one didn't fumigate an adjacent apartment so I'd go to sleep with roaches everywhere. The nicest one was too nice to me, a callous and callow 25 year old then, and ousted me with good cause. (I was a good kid, she said, but too irresponsible.)
posted by Kitteh at 1:25 PM on October 3, 2023 [1 favorite]
I've been a landlord. My wife and I bought a two-family house in Brooklyn and fixed it up and rented half to help cover the mortgage payment. The only other alternative was to keep renting and continue being victims of the same scheme, so when we hand the opportunity to switch over to perpetrating said scheme, we jumped at it. We tried to charge only what we needed (under market rates) and to perform repairs swiftly. We didn't complain about the high heels and dog making noise over our heads. We felt lucky, and when we had to sell to move and help deal with a family emergency, we made sure the buyer would take care of our tenants. But we profited from the equity we'd built while our renters did not.
So yes, being a landlord is inherently immoral. But owning property in itself is inherently immoral. Capitalism is immoral. Being born into a system of economic inequality is unjust. Everyone has to live somewhere, and the choices we have are constrained. The system sucks, it's rigged against those with less power and for the status quo.
Mom-and-pop landlords do exist, and some are great and some suck, but the problem is mainly (surprise suprise!) big corporations. And while they may be waving these small-timers out as a fig leaf, you can bet the lobbying muscle is coming from the big guys who would be just as glad to hang their own poster children out to dry when the time comes.
posted by rikschell at 1:43 PM on October 3, 2023 [19 favorites]
So yes, being a landlord is inherently immoral. But owning property in itself is inherently immoral. Capitalism is immoral. Being born into a system of economic inequality is unjust. Everyone has to live somewhere, and the choices we have are constrained. The system sucks, it's rigged against those with less power and for the status quo.
Mom-and-pop landlords do exist, and some are great and some suck, but the problem is mainly (surprise suprise!) big corporations. And while they may be waving these small-timers out as a fig leaf, you can bet the lobbying muscle is coming from the big guys who would be just as glad to hang their own poster children out to dry when the time comes.
posted by rikschell at 1:43 PM on October 3, 2023 [19 favorites]
The thing that jumps out at you from this are a few things. First, that these people exist, and that they’re not always what you want as a tenant, or as someone with a broader interest in good housing for cities, since they’re usually undercapitalised, and more exposed to risk. Second, how remarkable it is that in western countries how dominant property is as an investment class: there’s no other alternative financial sector that competes in terms of retirement, and certainly not savings work. Third, just how intellectually impoverished the language of privilege has become, that someone like this can deploy it directly, explicitly, in the service of property.
posted by Fiasco da Gama at 2:02 PM on October 3, 2023 [5 favorites]
posted by Fiasco da Gama at 2:02 PM on October 3, 2023 [5 favorites]
I feel like I personally had a number of way better than average landlords in my life, but I haven't been a renter since 2003. I'm not a landlord. I have a friend who owns two houses, one of which she rents. I know she strives to be a decent landlord but I also see her get a bit squirmy about trying to justify her position, its interesting...
posted by supermedusa at 2:02 PM on October 3, 2023 [1 favorite]
posted by supermedusa at 2:02 PM on October 3, 2023 [1 favorite]
I knew the comments on this post would be a lot of personal stories from mefites who are landlords. I'm a landlord too - we're renting to a friend and losing money overall, BUT, plus side, we're in a much bigger house we couldn't have afforded without renting out the old house.
posted by subdee at 2:10 PM on October 3, 2023
posted by subdee at 2:10 PM on October 3, 2023
My landlords don't like when I call them that so I started calling them my housemates. I rent their basement. We see each other in passing but unless they're down here to do the laundry, we don't really interact. (They're good people but we don't need to hang out.)
I find it to be mutually beneficial -- they charge me pretty cheap rent (which they haven't increased in the ~8 years I've been here and they'd be within their rights to do so) and that means they can afford the payments on their house in a pretty expensive area. (The cheap rent has also allowed me to save money with the goal of buying my own home at some point in the next few years.)
I guess this situation is a bit different, though. I've definitely had weird experiences with more "mom and pop" landlords (like one who owned a few properties) who were both neglectful while still spending too much time around, like the one who suddenly decided he needed to work in his office on the property on the day I was moving out. He also grumbled when we told him we were moving out because we only gave him 4 weeks notice instead of 6. He, I must note, has just sent us a notification of a rent increase, which we didn't have to agree to. He shut up once I pointed that out.
posted by edencosmic at 2:18 PM on October 3, 2023
I find it to be mutually beneficial -- they charge me pretty cheap rent (which they haven't increased in the ~8 years I've been here and they'd be within their rights to do so) and that means they can afford the payments on their house in a pretty expensive area. (The cheap rent has also allowed me to save money with the goal of buying my own home at some point in the next few years.)
I guess this situation is a bit different, though. I've definitely had weird experiences with more "mom and pop" landlords (like one who owned a few properties) who were both neglectful while still spending too much time around, like the one who suddenly decided he needed to work in his office on the property on the day I was moving out. He also grumbled when we told him we were moving out because we only gave him 4 weeks notice instead of 6. He, I must note, has just sent us a notification of a rent increase, which we didn't have to agree to. He shut up once I pointed that out.
posted by edencosmic at 2:18 PM on October 3, 2023
the more I think on it, I've also been lucky with landlords. I have had some bad landlords but mostly they've been typical or decent.
when my parents were newlywed and dad was finishing his PhD, they took up renting with an older gentleman who was looking for light housekeeping and meals for reduced rent from reliable tenants. This arrangement was very mutually beneficial, and they enjoyed each other's company.
my one-time in-laws purchased their first home and promptly moved into the basement, renting out the main floor to take advantage of income to help them pay off the house more quickly. Many in their community of friends did similar.
I was fortunate to get a tiny apartment in a big home in downtown Edmonton, paying far below market rates. The owners of the home didn't live there, but they rented by word-of-mouth and tried to reserve suites for students.
anyone I know who has a home and rents it out, has dealt with nightmares these past few years. I don't think it's easy to be a landlord in this scenario. The 'Mom & Pop' landlords described in the article aren't quite what I'm describing, I get that. The CBC segment I linked to does describe the type of person who would like to rent out a room/basement in their home, but the risk is not worth it. There is a question of the amount of available rental units in an average city, if you could simply open things up to these one-off arrangements and protect both renters and homeowners. I think the answer is: adequate regulation and enforcement. Renters who take advantage should face penalties, and most importantly: landlords who take advantages should face bigger penalties.
I hate to say the problem needs more government enforcement, but the "free market" is sure as shit not helping.
posted by elkevelvet at 2:46 PM on October 3, 2023 [2 favorites]
when my parents were newlywed and dad was finishing his PhD, they took up renting with an older gentleman who was looking for light housekeeping and meals for reduced rent from reliable tenants. This arrangement was very mutually beneficial, and they enjoyed each other's company.
my one-time in-laws purchased their first home and promptly moved into the basement, renting out the main floor to take advantage of income to help them pay off the house more quickly. Many in their community of friends did similar.
I was fortunate to get a tiny apartment in a big home in downtown Edmonton, paying far below market rates. The owners of the home didn't live there, but they rented by word-of-mouth and tried to reserve suites for students.
anyone I know who has a home and rents it out, has dealt with nightmares these past few years. I don't think it's easy to be a landlord in this scenario. The 'Mom & Pop' landlords described in the article aren't quite what I'm describing, I get that. The CBC segment I linked to does describe the type of person who would like to rent out a room/basement in their home, but the risk is not worth it. There is a question of the amount of available rental units in an average city, if you could simply open things up to these one-off arrangements and protect both renters and homeowners. I think the answer is: adequate regulation and enforcement. Renters who take advantage should face penalties, and most importantly: landlords who take advantages should face bigger penalties.
I hate to say the problem needs more government enforcement, but the "free market" is sure as shit not helping.
posted by elkevelvet at 2:46 PM on October 3, 2023 [2 favorites]
It's funny, the last landlord we had (before moving to a new city and buying a place) was really nice. He was a busy young father renting out a house for his retired parents. They gave us a good deal, and we helped them out with some light maintenance and gardening.
And that was an anomaly. Most of the landlords I've experienced in my career were parasites, including some of the most unlikable people that I've ever met.
posted by ovvl at 3:16 PM on October 3, 2023
And that was an anomaly. Most of the landlords I've experienced in my career were parasites, including some of the most unlikable people that I've ever met.
posted by ovvl at 3:16 PM on October 3, 2023
Every landlord I've ever had had been an asshole. I know good landlords do exist. My grandparents rented out a house for a while. But it's not the norm.
It's really fucking hard to be a good landlord, is the real problem, and so I sense that people who are decent eventually just stop. At one time, I was in a position to be a landlord, but had to wrestle with the fact that I am not capable of evicting people, so what does that mean? Apparently, for me, that I need to not be a landlord. People who are capable of evicting people remain.
posted by corb at 3:35 PM on October 3, 2023 [8 favorites]
It's really fucking hard to be a good landlord, is the real problem, and so I sense that people who are decent eventually just stop. At one time, I was in a position to be a landlord, but had to wrestle with the fact that I am not capable of evicting people, so what does that mean? Apparently, for me, that I need to not be a landlord. People who are capable of evicting people remain.
posted by corb at 3:35 PM on October 3, 2023 [8 favorites]
"So pity the downtrodden landlord,
And his back that is burdened and bent.
Respect his grey hairs,
Don't ask for repairs,
And don't be behind with the rent!"
Barnet Woolf, Arnold Clayton, 1946
posted by tspae at 3:53 PM on October 3, 2023 [8 favorites]
And his back that is burdened and bent.
Respect his grey hairs,
Don't ask for repairs,
And don't be behind with the rent!"
Barnet Woolf, Arnold Clayton, 1946
posted by tspae at 3:53 PM on October 3, 2023 [8 favorites]
I like to think I'm in the tiny minority of landlords who don't suck. I have incentives that the vast majority of landlords do not - I own a 2-family house and I live in one unit and rent out the other. There are clear advantages to having a good tenant since they're right there in my damned house. I like to think I work hard at my half of the landlord/tenant relationship - making sure snow is cleared, getting things repaired quickly, generally not being an ass about things. So, yeah, I'm quite happy to optimize for "pleasant living environment" over "squeezing every last cent out of this whole 'property' thing."
And, speaking as a landlord, holy crap but a whole lot of landlords out there just totally fucking suck. Jeeeeeeezus.
posted by rmd1023 at 4:17 PM on October 3, 2023 [3 favorites]
And, speaking as a landlord, holy crap but a whole lot of landlords out there just totally fucking suck. Jeeeeeeezus.
posted by rmd1023 at 4:17 PM on October 3, 2023 [3 favorites]
Also Melville had it:
Bildad laid down his book, and turning solemnly towards him said, “Captain Peleg, thou hast a generous heart; but thou must consider the duty thou owest to the other owners of this ship—widows and orphans, many of them—and that if we too abundantly reward the labors of this young man, we may be taking the bread from those widows and those orphans…posted by Fiasco da Gama at 4:20 PM on October 3, 2023 [4 favorites]
The current market gives people with more power the ability to use that power in many ways. There are problems and solutions, but mostly I hear people saying that the problem is that the problem exists, and that the solution is to get rid of the problem.
I agree the system is cruel and unjust. I agree that one solution is for society to ensure that economic prosperity is shared by all - especially taking care of those for whom care is most affordable. (even a $500/mo ubi would save so many lives. Even $100/wk.)
While I'm supporting these system changes, I've also been trying to figure out how people with less power can work together to find an alternative.
I am currently researching what it would take to build a wonderful 6-plex in Portland, Oregon. My idea is that my family and two other families we know would go in together to design and build it, and then each would also have a second unit to rent out, airbnb, use for family, or expand into as their family grows and the economy allows it.
We need so much more housing. Housing currently can be used as a ladder to build household wealth, and generational wealth. Housing shapes our engagement with society. We can design it to ebe better for us, and better to us, and to help us be better fto each other. Somehow. I hope.
posted by rebent at 4:23 PM on October 3, 2023 [2 favorites]
I agree the system is cruel and unjust. I agree that one solution is for society to ensure that economic prosperity is shared by all - especially taking care of those for whom care is most affordable. (even a $500/mo ubi would save so many lives. Even $100/wk.)
While I'm supporting these system changes, I've also been trying to figure out how people with less power can work together to find an alternative.
I am currently researching what it would take to build a wonderful 6-plex in Portland, Oregon. My idea is that my family and two other families we know would go in together to design and build it, and then each would also have a second unit to rent out, airbnb, use for family, or expand into as their family grows and the economy allows it.
We need so much more housing. Housing currently can be used as a ladder to build household wealth, and generational wealth. Housing shapes our engagement with society. We can design it to ebe better for us, and better to us, and to help us be better fto each other. Somehow. I hope.
posted by rebent at 4:23 PM on October 3, 2023 [2 favorites]
My experience with being a landlord in Australia is that the laws are incredibly biased towards favoring renters, perhaps, you might argue, as it should be. The system is what it is, I'm not complaining, just saying it like it is, and I could always sell the property, in fact I've already sold one other one...
We had a tenant scam us by entering a contract by paying one month's rent, and then never paying a single cent after that. But the local laws around eviction are so renter biased that it would have taken well over a year to evict them for non-payment - and we never even got to that point, because they vanished on their own voluntarily at some point 11 months in before the process ran to completion, trashing the place in the process. And up to that point, whenever the tenant asked for repairs - we had to honor them promptly within the legislated time period! Even stupid minor issues like, oh, the clothesline broke, can you send someone to thread a new one. Crazy stuff, because the case was "pending" before the tribunal, you couldn't afford to have anything less than a perfect service record otherwise it would bias the process against you. And it wasn't like they didn't have money, based on the possessions they had while living there and the sheer amount of stuff (about half a tonne) they just discarded when they left.
Basically, there's functionally no way to evict someone even if they haven't paid rent for a year. There's functionally no way to recover any money they owe (one year's rent, thousands of dollars in repairs and clean up). When asked for advice, the goverment body in charge literally said, be present when they exit the property, then physically follow them to their next address so you can continue to pursue them for they money they owe you! (You can't sent them a court notice if you don't have their address...) Yeah I'm not doing that.
If you own 100 properties, you can charge each tenant a 5% higher margin to cover the risk of losses from bad actors. If you're renting out only a handful of properties, your tolerance is much lower - you'll be extremely picky about the renters you'll accept with full documentation (must have full time salaried job, dual income preferred, screenshots of savings accounts to demonstrate financial buffer, references from workplaces, several year's inspection and rental payment records from former rental agencies, etc), you'll be looking for much higher margins to cover your losses and would rather leave the property vacant rather than accept a merely average income / low documentation tenant to avoid catastrophic levels of risk.
My property is always the lowest cost / best value in the area against comparable units, newly renovated throughout at the cost of about $50,000, just installed a modern, efficient heating and cooling system, and we've always immediately attended to all maintenance requests no matter how trivial.
The risk to the tenant of meeting a bad landlord? Just pay the lease break fee and never have to think about the problem again. My current tenant just broke their lease midway and I doubt I'll charge them anything since they're only liable for a pro-rata portion of the re-leasing costs, which is tiny anyway.
The joke I make is that I like building houses, I'm adding to the housing supply of the nation, I'm doing something about the problem! Unlike most people who are complaining about lack of housing and either rent or buy something that someone else built in the past, out-competing poorer people for limited supply.
posted by xdvesper at 4:31 PM on October 3, 2023 [2 favorites]
We had a tenant scam us by entering a contract by paying one month's rent, and then never paying a single cent after that. But the local laws around eviction are so renter biased that it would have taken well over a year to evict them for non-payment - and we never even got to that point, because they vanished on their own voluntarily at some point 11 months in before the process ran to completion, trashing the place in the process. And up to that point, whenever the tenant asked for repairs - we had to honor them promptly within the legislated time period! Even stupid minor issues like, oh, the clothesline broke, can you send someone to thread a new one. Crazy stuff, because the case was "pending" before the tribunal, you couldn't afford to have anything less than a perfect service record otherwise it would bias the process against you. And it wasn't like they didn't have money, based on the possessions they had while living there and the sheer amount of stuff (about half a tonne) they just discarded when they left.
Basically, there's functionally no way to evict someone even if they haven't paid rent for a year. There's functionally no way to recover any money they owe (one year's rent, thousands of dollars in repairs and clean up). When asked for advice, the goverment body in charge literally said, be present when they exit the property, then physically follow them to their next address so you can continue to pursue them for they money they owe you! (You can't sent them a court notice if you don't have their address...) Yeah I'm not doing that.
If you own 100 properties, you can charge each tenant a 5% higher margin to cover the risk of losses from bad actors. If you're renting out only a handful of properties, your tolerance is much lower - you'll be extremely picky about the renters you'll accept with full documentation (must have full time salaried job, dual income preferred, screenshots of savings accounts to demonstrate financial buffer, references from workplaces, several year's inspection and rental payment records from former rental agencies, etc), you'll be looking for much higher margins to cover your losses and would rather leave the property vacant rather than accept a merely average income / low documentation tenant to avoid catastrophic levels of risk.
My property is always the lowest cost / best value in the area against comparable units, newly renovated throughout at the cost of about $50,000, just installed a modern, efficient heating and cooling system, and we've always immediately attended to all maintenance requests no matter how trivial.
The risk to the tenant of meeting a bad landlord? Just pay the lease break fee and never have to think about the problem again. My current tenant just broke their lease midway and I doubt I'll charge them anything since they're only liable for a pro-rata portion of the re-leasing costs, which is tiny anyway.
The joke I make is that I like building houses, I'm adding to the housing supply of the nation, I'm doing something about the problem! Unlike most people who are complaining about lack of housing and either rent or buy something that someone else built in the past, out-competing poorer people for limited supply.
posted by xdvesper at 4:31 PM on October 3, 2023 [2 favorites]
It's not a matter of who is nice or not. Our landlord is very nice. He's also the owner of our house to whom we pay as much (or more) than others would pay for a mortgage on a similar sized property, and he's the one making all the capital accumulation. The power and wealth differential matters.
Every landlord, no matter how "small", is a property owner who is making money off their property. Some people argue rental housing is classic rentier behaviour, others that it is an essential service. (I happen to agree with both). But a landlord is definitely a part of the propertied class - and most renters are not. Being nice doesn't change this power imbalance.
posted by jb at 5:17 PM on October 3, 2023 [17 favorites]
Every landlord, no matter how "small", is a property owner who is making money off their property. Some people argue rental housing is classic rentier behaviour, others that it is an essential service. (I happen to agree with both). But a landlord is definitely a part of the propertied class - and most renters are not. Being nice doesn't change this power imbalance.
posted by jb at 5:17 PM on October 3, 2023 [17 favorites]
Also, in the case of a dispute between a landlord and a tenant: a landlord only risks property/money, a tenant is at risk of losing their home - and thus probably all of their property, but also their safety, wellbeing and health, possibly even their life (given the much reduced life expectancy of unhoused people). They are not equal risks.
posted by jb at 5:20 PM on October 3, 2023 [18 favorites]
posted by jb at 5:20 PM on October 3, 2023 [18 favorites]
The risk to the tenant of meeting a bad landlord? Just pay the lease break fee and never have to think about the problem again.
Yyyyyyyeaaaaah--no. Even in a "tenant-friendly" system, no. Try reading Matthew Desmond's Evicted to see how horrible things can become. Or ProPublica's "The Landlord and the Tenant."
posted by praemunire at 5:49 PM on October 3, 2023 [18 favorites]
Yyyyyyyeaaaaah--no. Even in a "tenant-friendly" system, no. Try reading Matthew Desmond's Evicted to see how horrible things can become. Or ProPublica's "The Landlord and the Tenant."
posted by praemunire at 5:49 PM on October 3, 2023 [18 favorites]
Personally, I don't have a problem with landlords as a concept. What I do have a problem with is how basically all of them in my region are making windfall profits on both the rent and the appreciation of the underlying property and somehow also manage to receive significant tax advantages relative to wage workers.
People who choose to deploy their own resources to acquire a thing and then let other people use that thing aren't doing anything inherently wrong in receiving fair compensation for the temporary loss of use and the risk involved. It really gets fucked in a state like Florida where there are minimal protections for renters and what little bit local governments managed to pass (like providing 60 days of notice for a substantial increase in rent so that the tenant at least has some time to find other living arrangements) have since been preempted by the state government..at the behest of landlords who resent not being able to just do whatever the fuck they want.
Now, what I will say is a complete fucking scam is property owners/management companies who require the payment of substantial (and often literally illegal) non-refundable application fees up front, often when they know they have no units available for the applicant or that the applicant will not be approved. I've seen some places charging $200 per person. Given the tight market here it often happens that a property will only have one or two units available and receive 50-100 applications. Even with the sky high rent, they're making more money on app fees than they are rent. That is exactly the kind of shit that desperately needs to be outlawed. Even the big l libertarians should be able to agree that the practice is essentially fraudulent.
posted by wierdo at 6:06 PM on October 3, 2023 [8 favorites]
People who choose to deploy their own resources to acquire a thing and then let other people use that thing aren't doing anything inherently wrong in receiving fair compensation for the temporary loss of use and the risk involved. It really gets fucked in a state like Florida where there are minimal protections for renters and what little bit local governments managed to pass (like providing 60 days of notice for a substantial increase in rent so that the tenant at least has some time to find other living arrangements) have since been preempted by the state government..at the behest of landlords who resent not being able to just do whatever the fuck they want.
Now, what I will say is a complete fucking scam is property owners/management companies who require the payment of substantial (and often literally illegal) non-refundable application fees up front, often when they know they have no units available for the applicant or that the applicant will not be approved. I've seen some places charging $200 per person. Given the tight market here it often happens that a property will only have one or two units available and receive 50-100 applications. Even with the sky high rent, they're making more money on app fees than they are rent. That is exactly the kind of shit that desperately needs to be outlawed. Even the big l libertarians should be able to agree that the practice is essentially fraudulent.
posted by wierdo at 6:06 PM on October 3, 2023 [8 favorites]
FWIW all the things xdvesper describes are, if a bit landlord-biased, also reflective of the Australian context (I am a renter in it). But it's as I described earlier---this is a hell of a way to run a financial system, where residential property is so very much more favoured by our tax and housing and planning systems than any other asset, that for ordinary people---who don't have access to the weird cornucopia of derivatives and financiery-magic that firms do---there is just no alternative for investment for retirement. You want to say, well if you don't like it, sell up and invest in something else, but what is there? What else is there that compares? There's a crisis of productivity everywhere. Superannuation, bonds, shoving your dirty hundies under the blanket? Crypto? The ace and seven in my hand with a flush draw on the table? Hardly.
Residential housing is so strongly preferred as an asset class and because it, by consensus of our politics, must always rise in value (even at the expense of the public), that it's summoned a whole group of people into work as landlords who aren't suited to it and don't like it, who stand far greater consequences from risk (not just bad tenants, consider fires, storms, floods) and who simply don't have access to the techniques and tools, and the capital base, that larger housing firms do. That sucks, for everyone.
posted by Fiasco da Gama at 6:13 PM on October 3, 2023 [5 favorites]
Residential housing is so strongly preferred as an asset class and because it, by consensus of our politics, must always rise in value (even at the expense of the public), that it's summoned a whole group of people into work as landlords who aren't suited to it and don't like it, who stand far greater consequences from risk (not just bad tenants, consider fires, storms, floods) and who simply don't have access to the techniques and tools, and the capital base, that larger housing firms do. That sucks, for everyone.
posted by Fiasco da Gama at 6:13 PM on October 3, 2023 [5 favorites]
George Orwell, The Road to Wigan Pier:
In some cases I have noted ‘Landlord good’ or ‘Landlord bad’, because there is great variation in what the slum-dwellers say about their landlords. I found—one might expect it, perhaps—that the small landlords are usually the worst. It goes against the grain to say this, but one can see why it should be so. Ideally, the worst type of slum landlord is a fat wicked man, preferably a bishop, who is drawing an immense income from extortionate rents. Actually, it is a poor old woman who has invested her life’s savings in three slum houses, inhabits one of them, and tries to live on the rent of the other two—never, in consequence, having any money for repairs.posted by foxfirefey at 6:17 PM on October 3, 2023 [7 favorites]
FWIW all the things xdvesper describes are, if a bit landlord-biased, also reflective of the Australian context
Sure, some of the circumstances are different, but the answer to the question of who has more to lose between the guy who's already rich enough to own at least two properties and the person who most commonly owns zero and so is putting all their belongings in a property they don't own and relying for their actual, literal, no-shit physical safety at home on the first guy doesn't change.
posted by praemunire at 6:38 PM on October 3, 2023 [9 favorites]
Sure, some of the circumstances are different, but the answer to the question of who has more to lose between the guy who's already rich enough to own at least two properties and the person who most commonly owns zero and so is putting all their belongings in a property they don't own and relying for their actual, literal, no-shit physical safety at home on the first guy doesn't change.
posted by praemunire at 6:38 PM on October 3, 2023 [9 favorites]
My mom is a landlord, and someday I will be too. She owns a building her parents bought in the 70s, so that they could live in one side and my mother - who was leaving a failed relationship in NYC and moving to Maine with her infant daughter (me) - could live in the other. The building was built in the 20s or 30s as housing for people who were working in the mills. About 30 years ago my mother split one side of the building, so now it has three apartment units.
A long time ago, because of where the property is, she began renting to medical residents who are temporarily practicing at a nearby rural hospital. She no longer has to advertise the property much - residents come, stay for a year or so, then move on to their more permanent practice location and as they're leaving recommend new tenants to my mom. And the cycle continues.
None of her tenants intend to stay here. Indeed, they should not stay - many of them move on to become family physicians in even more rural parts of New England, where they're sorely needed.
So I read things like "landlords need to be brought to justice" and "Bring a landlord is inherently immoral" and I think of my mom, and her three apartments that provide her a little extra income, and her doctor tenants, and ... I guess I can't square that up. Because the alternative would be, what exactly? Them purchasing a part of a house for 13 - 14 months, then selling it to someone else? The hospital providing dorms for them and thereby becoming the landlord?
posted by anastasiav at 7:27 PM on October 3, 2023 [9 favorites]
A long time ago, because of where the property is, she began renting to medical residents who are temporarily practicing at a nearby rural hospital. She no longer has to advertise the property much - residents come, stay for a year or so, then move on to their more permanent practice location and as they're leaving recommend new tenants to my mom. And the cycle continues.
None of her tenants intend to stay here. Indeed, they should not stay - many of them move on to become family physicians in even more rural parts of New England, where they're sorely needed.
So I read things like "landlords need to be brought to justice" and "Bring a landlord is inherently immoral" and I think of my mom, and her three apartments that provide her a little extra income, and her doctor tenants, and ... I guess I can't square that up. Because the alternative would be, what exactly? Them purchasing a part of a house for 13 - 14 months, then selling it to someone else? The hospital providing dorms for them and thereby becoming the landlord?
posted by anastasiav at 7:27 PM on October 3, 2023 [9 favorites]
I think of my mom
Your mom is a beneficiary of injustice. But...everyone reading this thread is, too, one way or another, and some of us in degrees at least as great as someone who owns a residential multifamily property. It's not like one can simply decide not to be. The question is whether one recognizes this, attempts to resist being compromised by it as much as possible, and works as best one can towards a more just world, which in this case I think would involve a sufficient supply of state housing that if private landlords continued to exist they would not have their foots on the necks of the less well-off.
So I don't think it's inherently contemptible to be a landlord. It is, however, easy and extremely common for a landlord to act in contemptible ways, and it is contemptible to engage in special pleading or economic fantasies about the dynamic involved. My brother is not only a landlord but recently evicted someone, and for good reason. That doesn't change the fact that my brother is a white college-educated guy with a stable job married to a successful professional who owns a nice house they got the down payment for largely from his mother-in-law, and while having his second property trashed and only one month's rent ever paid sucks for him, he's going to be fine. His extremely unstable tenant, a black single mother in the city...maybe not so much.
posted by praemunire at 7:51 PM on October 3, 2023 [5 favorites]
Your mom is a beneficiary of injustice. But...everyone reading this thread is, too, one way or another, and some of us in degrees at least as great as someone who owns a residential multifamily property. It's not like one can simply decide not to be. The question is whether one recognizes this, attempts to resist being compromised by it as much as possible, and works as best one can towards a more just world, which in this case I think would involve a sufficient supply of state housing that if private landlords continued to exist they would not have their foots on the necks of the less well-off.
So I don't think it's inherently contemptible to be a landlord. It is, however, easy and extremely common for a landlord to act in contemptible ways, and it is contemptible to engage in special pleading or economic fantasies about the dynamic involved. My brother is not only a landlord but recently evicted someone, and for good reason. That doesn't change the fact that my brother is a white college-educated guy with a stable job married to a successful professional who owns a nice house they got the down payment for largely from his mother-in-law, and while having his second property trashed and only one month's rent ever paid sucks for him, he's going to be fine. His extremely unstable tenant, a black single mother in the city...maybe not so much.
posted by praemunire at 7:51 PM on October 3, 2023 [5 favorites]
I think of my mom
Let me be very clear that the article and podcast is probably not about your mom, it is about small landlords who volunteer (or lets be real, are probably paid handsomely) as spokespeople for rich and powerful astroturfing corporate real estate lobby groups, where they get paraded around in the WSJ and NYT and go on the news and cry about how oppressed they are as property owners, and in fact when progressives criticize them they are actually Doing a Racism, so make sure to vote No on Rent Control and Tenant Protections y'all, because these regulations are actually harming small business owners, who are people of color sometimes maybe!
...Does your mom do that? If not, most people here are probably cool with her.
posted by windbox at 8:09 PM on October 3, 2023 [8 favorites]
Let me be very clear that the article and podcast is probably not about your mom, it is about small landlords who volunteer (or lets be real, are probably paid handsomely) as spokespeople for rich and powerful astroturfing corporate real estate lobby groups, where they get paraded around in the WSJ and NYT and go on the news and cry about how oppressed they are as property owners, and in fact when progressives criticize them they are actually Doing a Racism, so make sure to vote No on Rent Control and Tenant Protections y'all, because these regulations are actually harming small business owners, who are people of color sometimes maybe!
...Does your mom do that? If not, most people here are probably cool with her.
posted by windbox at 8:09 PM on October 3, 2023 [8 favorites]
Sorry, guys, but I'm squarely in the camp of "I hate landlords; they suck as human beings and need to examine their worth and character more closely because, if there's a hell, they're all destined and deserve eternal torture". But, then, I'm being evicted at the moment after being threatened by landlord to have "big thugs" come and remove me, and who just refuses to follow any tenancy laws since they can eat the fines. So, for all your apologia, and in the most civil tone I can muster: get bent.
posted by DeepSeaHaggis at 8:21 PM on October 3, 2023 [7 favorites]
posted by DeepSeaHaggis at 8:21 PM on October 3, 2023 [7 favorites]
If we are going to do a good old class analysis of landlords, let's not forget to distinguish between the bourgeois landlords and the petit bourgeois landlords. Their class interests may not coincide, as the article suggests.
Full disclosure, I am a landlord AND a tenant right now. In my experience of landlords, some have the attitude that if your under their roof, you are under their control. Those landlords are acting out authoritarian fantasies on a microscale. And projection. They are out to cheat anyone they can, and expect others to behave in that way towards them.
I can see how such petty petit bourgeois landlords are eager to carry the bourgeois landlords' water.
posted by SnowRottie at 8:22 PM on October 3, 2023 [2 favorites]
Full disclosure, I am a landlord AND a tenant right now. In my experience of landlords, some have the attitude that if your under their roof, you are under their control. Those landlords are acting out authoritarian fantasies on a microscale. And projection. They are out to cheat anyone they can, and expect others to behave in that way towards them.
I can see how such petty petit bourgeois landlords are eager to carry the bourgeois landlords' water.
posted by SnowRottie at 8:22 PM on October 3, 2023 [2 favorites]
Last comment and then I'll leave it, as I recognise I'm here a lot.
The social relationship of domination and of inequality is obvious to everyone, and inherent in the owning of the dwelling: the medieval origins of the term 'landlord' is the clue. The problem as I see it though, is that the current most dominant model for inequality and domination we have in the West, the do-it-all shifting spanner most people reach for in their mental toolbox to explain inequalities, is the language of 'privilege', which has been shorn of its original basis in actual intersectional thinking about power, leaving only the intersection, and a kind of Protestant feeling of personal virtue and position. It's now completely individualised, and relies on a listing of privileges and deprivations (of a kind that can only be held by individuals) to explain the way things are. The result is that the discussion immediately flies free from the idea of power, and goes to whether landlords are good or bad people; as though the individual virtues/evils of the title-holder (kind, cruel, rich, poor, white, black, native-born, migrant) were in the slightest bit relevant to the power relationship of a lease, the condition of the housing market generally, or the makeup of an urban system of property ownership.
posted by Fiasco da Gama at 8:26 PM on October 3, 2023 [7 favorites]
The social relationship of domination and of inequality is obvious to everyone, and inherent in the owning of the dwelling: the medieval origins of the term 'landlord' is the clue. The problem as I see it though, is that the current most dominant model for inequality and domination we have in the West, the do-it-all shifting spanner most people reach for in their mental toolbox to explain inequalities, is the language of 'privilege', which has been shorn of its original basis in actual intersectional thinking about power, leaving only the intersection, and a kind of Protestant feeling of personal virtue and position. It's now completely individualised, and relies on a listing of privileges and deprivations (of a kind that can only be held by individuals) to explain the way things are. The result is that the discussion immediately flies free from the idea of power, and goes to whether landlords are good or bad people; as though the individual virtues/evils of the title-holder (kind, cruel, rich, poor, white, black, native-born, migrant) were in the slightest bit relevant to the power relationship of a lease, the condition of the housing market generally, or the makeup of an urban system of property ownership.
posted by Fiasco da Gama at 8:26 PM on October 3, 2023 [7 favorites]
Praemunire: Australia is in the midst of a really crippling housing crisis right now. The risk of renters being evicted leads to homelessness right now - our vacancy rate has been sitting around 1-2% or thereabouts for years, resulting in soaring rents that have resulted in an upswing in homelessness, especially among demographics that otherwise would not see it.
It's also worth noting our rental protections are pretty poor compared to other parts of the world. In many states it's only been allowable to make minor changes like installing picture hooks since the start of the year, for example. Ongoing monthly leases are increasingly common (ie, you can be saddled with a rent increase without much warning or turfed out at the end of the period, with no right to remain) and xdvesper's claim that landlords must immediately fix things or face problems is laughable - I've lived in houses with doors that don't lock, holes in the floors and walls, and worse, because the more you push the more likely you are to be evicted, and that's all there is to it. I'm assuming they're in a state with better renter protection laws, like Victoria, because here in Queensland it was brought to attention that our Rental Tenanacy Authority goes years at a time without fining landlords for violating the tenancy act. Mostly what happens to landlords who don't do repairs in a timely manner is bugger and all. Many juristictions allow tenants to be evicted for 'repairs' and I've had that one held over me a few times - if the damage is so bad I might just have to boot you out to fix it, so suck it up and have somewhere to live, okay?
They also don't mention the fun and games of the TICA blacklist - a service run for landlords that records 'undesirable' tenants. You bail on a property, you wind up on the blacklist and you're fucked for rental housing the rest of your life. I lived with a woman who would up on the blacklist because of a hole knocked in a wall by an abusive boyfriend - and at 45 still can't get a rental and is dependent on subleasing. It's totally opaque and if you're on it, good luck finding out, and you'll need more to get off it.
The context is important.
And do you know how Australia has gotten into this state? Every time people ask for change the mum-and-dad landlords are whipped out as being too struggling to be able to cope with changes like making sure houses aren't too cold to live in safely and that they shouldn't have to pay up to get their properties up to spec, and that they will all sell up and we'll have less housing stock, somehow. Mum-and-dad landlords have done irrevocable damage to the renting landscape here in Australia. We can't ask for reasonable tenant rights at all or boo hoo, someone's gran might be impacted.
Running a rental property is an investment. It has risks just the same as any other, and those risks are downplayed so much that people assume there's no work involved in running a rental, let alone a chance you won't see a return. I own my own place now and I have to do maintenance every now and then, but for some reason when that same wear and tear happens in a rental it's because your tenants are 'careless' or some shit. Like sometimes things just gotta be fixed, mate.
posted by Jilder at 8:31 PM on October 3, 2023 [16 favorites]
It's also worth noting our rental protections are pretty poor compared to other parts of the world. In many states it's only been allowable to make minor changes like installing picture hooks since the start of the year, for example. Ongoing monthly leases are increasingly common (ie, you can be saddled with a rent increase without much warning or turfed out at the end of the period, with no right to remain) and xdvesper's claim that landlords must immediately fix things or face problems is laughable - I've lived in houses with doors that don't lock, holes in the floors and walls, and worse, because the more you push the more likely you are to be evicted, and that's all there is to it. I'm assuming they're in a state with better renter protection laws, like Victoria, because here in Queensland it was brought to attention that our Rental Tenanacy Authority goes years at a time without fining landlords for violating the tenancy act. Mostly what happens to landlords who don't do repairs in a timely manner is bugger and all. Many juristictions allow tenants to be evicted for 'repairs' and I've had that one held over me a few times - if the damage is so bad I might just have to boot you out to fix it, so suck it up and have somewhere to live, okay?
They also don't mention the fun and games of the TICA blacklist - a service run for landlords that records 'undesirable' tenants. You bail on a property, you wind up on the blacklist and you're fucked for rental housing the rest of your life. I lived with a woman who would up on the blacklist because of a hole knocked in a wall by an abusive boyfriend - and at 45 still can't get a rental and is dependent on subleasing. It's totally opaque and if you're on it, good luck finding out, and you'll need more to get off it.
The context is important.
And do you know how Australia has gotten into this state? Every time people ask for change the mum-and-dad landlords are whipped out as being too struggling to be able to cope with changes like making sure houses aren't too cold to live in safely and that they shouldn't have to pay up to get their properties up to spec, and that they will all sell up and we'll have less housing stock, somehow. Mum-and-dad landlords have done irrevocable damage to the renting landscape here in Australia. We can't ask for reasonable tenant rights at all or boo hoo, someone's gran might be impacted.
Running a rental property is an investment. It has risks just the same as any other, and those risks are downplayed so much that people assume there's no work involved in running a rental, let alone a chance you won't see a return. I own my own place now and I have to do maintenance every now and then, but for some reason when that same wear and tear happens in a rental it's because your tenants are 'careless' or some shit. Like sometimes things just gotta be fixed, mate.
posted by Jilder at 8:31 PM on October 3, 2023 [16 favorites]
+1 for tenant protection in Australia not actually being all that great.
My oven's been broken for two months, there's been black mould in a corner the entire lease (again, just nothing from the agent on that), I'm on month to month and the agent is being evasive when I ask for another 6-month lease. The rent went up 18% last November and I expect will again in another month or two. At least when the roof leaked they got someone out after a couple of weeks.
And I'm petrified of *losing* this amazing deal I have, because two trans girls who barely clear the informal income requirements aren't going to find it easy to find anything half as good. I've got another 3 friends desperately searching for housing, locked out at their income levels, forced to stay with abusive partners or family.
posted by Audreynachrome at 9:14 PM on October 3, 2023 [6 favorites]
My oven's been broken for two months, there's been black mould in a corner the entire lease (again, just nothing from the agent on that), I'm on month to month and the agent is being evasive when I ask for another 6-month lease. The rent went up 18% last November and I expect will again in another month or two. At least when the roof leaked they got someone out after a couple of weeks.
And I'm petrified of *losing* this amazing deal I have, because two trans girls who barely clear the informal income requirements aren't going to find it easy to find anything half as good. I've got another 3 friends desperately searching for housing, locked out at their income levels, forced to stay with abusive partners or family.
posted by Audreynachrome at 9:14 PM on October 3, 2023 [6 favorites]
The context is important.
I...don't think we're disagreeing about anything? I even put "tenant-friendly" in quotes because honestly I don't know a ton about the Australian real estate market.
posted by praemunire at 9:27 PM on October 3, 2023 [3 favorites]
I...don't think we're disagreeing about anything? I even put "tenant-friendly" in quotes because honestly I don't know a ton about the Australian real estate market.
posted by praemunire at 9:27 PM on October 3, 2023 [3 favorites]
Because the alternative would be, what exactly? Them purchasing a part of a house for 13 - 14 months, then selling it to someone else? The hospital providing dorms for them and thereby becoming the landlord?
There should be a thriving public option housing provider in every community that ensures around 6% vacancy, with those vacant units being listed on AirB&B in the mean time. Public housing credits would be given to individuals based on some UBI calculation to be devised. (Also, property tax would be paid based on proportional square footage of land and municipal services used, instead of on "market value" of the building, so that the inner city stopped subsidizing the suburbs. ) The doctors could stay in those public units, and, knowing that there would be regular cycle of doctors coming through the area, the housing commission would be sure to provide suitable accommodations.
To accomplish this, we have to give up a few things. First, we have to be willing to trade some of the ability to grow wealthy for increasing the safety net. Personally, I hope this comes by decapitating the billionaire corporate specters that are sucking the life from the rest of us. But, it would probably have some trickle-down impact on "smaller" organizations as well.
Second, we will have to be creative and willing to re-expand the spectrum of housing options. I swear to god I don't want to see favelas and shanty towns grow permanent in my city, but that's gotta be better than a shopping cart. And this could be avoided if we would cut more houses into micro-units, and allowed small-scale construction and modular builds. We have more people than we have houses! the system is broken, we need more houses, and the only way to do that is to expand the spectrum.
When people have power, they can negotiate with landlords. When people have choices, they can pay less. Fixing the safety net is the only thing that will bring things in balance.
posted by rebent at 9:39 PM on October 3, 2023 [6 favorites]
There should be a thriving public option housing provider in every community that ensures around 6% vacancy, with those vacant units being listed on AirB&B in the mean time. Public housing credits would be given to individuals based on some UBI calculation to be devised. (Also, property tax would be paid based on proportional square footage of land and municipal services used, instead of on "market value" of the building, so that the inner city stopped subsidizing the suburbs. ) The doctors could stay in those public units, and, knowing that there would be regular cycle of doctors coming through the area, the housing commission would be sure to provide suitable accommodations.
To accomplish this, we have to give up a few things. First, we have to be willing to trade some of the ability to grow wealthy for increasing the safety net. Personally, I hope this comes by decapitating the billionaire corporate specters that are sucking the life from the rest of us. But, it would probably have some trickle-down impact on "smaller" organizations as well.
Second, we will have to be creative and willing to re-expand the spectrum of housing options. I swear to god I don't want to see favelas and shanty towns grow permanent in my city, but that's gotta be better than a shopping cart. And this could be avoided if we would cut more houses into micro-units, and allowed small-scale construction and modular builds. We have more people than we have houses! the system is broken, we need more houses, and the only way to do that is to expand the spectrum.
When people have power, they can negotiate with landlords. When people have choices, they can pay less. Fixing the safety net is the only thing that will bring things in balance.
posted by rebent at 9:39 PM on October 3, 2023 [6 favorites]
praemire: You are totally right and the flames on the side of my face obscured the bit where normally I'd have gotten to the end and gone "ah, this got bigger than just a reply, take the name off". My apologies there.
posted by Jilder at 10:03 PM on October 3, 2023 [2 favorites]
posted by Jilder at 10:03 PM on October 3, 2023 [2 favorites]
praemunire, I mean. SEE? THE FLAMES DESTROY ALL RATIONALITY.
posted by Jilder at 10:13 PM on October 3, 2023 [1 favorite]
posted by Jilder at 10:13 PM on October 3, 2023 [1 favorite]
also reflective of the Australian context (I am a renter in it). But it's as I described earlier---this is a hell of a way to run a financial system, where residential property is so very much more favoured by our tax and housing and planning systems than any other asset, that for ordinary people---who don't have access to the weird cornucopia of derivatives and financiery-magic that firms do---there is just no alternative for investment for retirement.
On this tangent - in the Australian context, I'm not worried about retirement - well, any more than I am about catastrophic climate change - my current spending levels are lower than the current aged pension, which everyone gets, so even if I end up retiring with $0 personal savings outside of super I'm pretty sure I can make a pretty good go at things.
Of course, buy your own home. But after that... If you are worried about retirement and want to invest, you could just put more into super, which I think is fairly tax advantaged. The math is complex, but say you wanted to buy a $500,000 house, so you save $10,000 per year for 10 years to get a $100,000 deposit and $30,000 stamp duty + legal fees. That's $206,000 pre-tax income (at 37% marginal) that you had to save for this. If you had put that $20,600 per year pre-tax (*) into super over 10 years, you'd end up investing $175,000 into index funds, rather than $100,000 in property equity.
(*) because you're bumping up against the contribution cap, but you get the idea. Also, leverage makes a difference, and even though you start out 75% ahead on the index fund in your super, you're now 5x leveraged on property and any gains / losses are amplified 5x minus the cost of interest you're paying for that leverage. But on the other hand you had 10 years of low tax gains on those index funds. Is it all enough to overcome the 75% starting point advantage? It's not entirely clear. It's meant to be the set and forget method, don't have to think about it too much.
In fact if you're already capped out on super just buying blue-chip dividend yielding shares like CBA or BHP in the long term isn't too bad due to franking dividend tax credit passthrough which makes their effective yield rather ridiculous particularly if you buy them in the name of someone who is earning a lower income or no income. In 2022 and 2021 despite the economic uncertainty BHP paid out a grossed up dividend yield of 16% (they typically pay out 75% of their profits as direct cash to shareholders). Put it this way, for every $100,000 of shares I owned I got paid $16,000 in those years, and that's not even counting the massive capital appreciation they have seen since 2015. That's almost ponzi scheme level of yield (Terra LUNA was offering 20% annual yield for staking their crypto before it collapsed).
TLDR there's plenty of options if you're looking to invest your excess cash. I'm not sure what the percentage is, but based on many people I know and personal experience, many people end up with properties to rent out due to changes in circumstance, not a deliberate desire to invest and become a landlord. People go out and buy their own property as a single person. But then they inherit a property from their deceased parent. Or they meet their partner, who also bought their own property. Or they want to upsize due to growing family, or downsize. And no one really wants to sell, because the buy+sell transaction costs are so high ($40,000-$50,000 once you count stamp duty, advertising, agent fees, legal).
posted by xdvesper at 12:25 AM on October 4, 2023
On this tangent - in the Australian context, I'm not worried about retirement - well, any more than I am about catastrophic climate change - my current spending levels are lower than the current aged pension, which everyone gets, so even if I end up retiring with $0 personal savings outside of super I'm pretty sure I can make a pretty good go at things.
Of course, buy your own home. But after that... If you are worried about retirement and want to invest, you could just put more into super, which I think is fairly tax advantaged. The math is complex, but say you wanted to buy a $500,000 house, so you save $10,000 per year for 10 years to get a $100,000 deposit and $30,000 stamp duty + legal fees. That's $206,000 pre-tax income (at 37% marginal) that you had to save for this. If you had put that $20,600 per year pre-tax (*) into super over 10 years, you'd end up investing $175,000 into index funds, rather than $100,000 in property equity.
(*) because you're bumping up against the contribution cap, but you get the idea. Also, leverage makes a difference, and even though you start out 75% ahead on the index fund in your super, you're now 5x leveraged on property and any gains / losses are amplified 5x minus the cost of interest you're paying for that leverage. But on the other hand you had 10 years of low tax gains on those index funds. Is it all enough to overcome the 75% starting point advantage? It's not entirely clear. It's meant to be the set and forget method, don't have to think about it too much.
In fact if you're already capped out on super just buying blue-chip dividend yielding shares like CBA or BHP in the long term isn't too bad due to franking dividend tax credit passthrough which makes their effective yield rather ridiculous particularly if you buy them in the name of someone who is earning a lower income or no income. In 2022 and 2021 despite the economic uncertainty BHP paid out a grossed up dividend yield of 16% (they typically pay out 75% of their profits as direct cash to shareholders). Put it this way, for every $100,000 of shares I owned I got paid $16,000 in those years, and that's not even counting the massive capital appreciation they have seen since 2015. That's almost ponzi scheme level of yield (Terra LUNA was offering 20% annual yield for staking their crypto before it collapsed).
TLDR there's plenty of options if you're looking to invest your excess cash. I'm not sure what the percentage is, but based on many people I know and personal experience, many people end up with properties to rent out due to changes in circumstance, not a deliberate desire to invest and become a landlord. People go out and buy their own property as a single person. But then they inherit a property from their deceased parent. Or they meet their partner, who also bought their own property. Or they want to upsize due to growing family, or downsize. And no one really wants to sell, because the buy+sell transaction costs are so high ($40,000-$50,000 once you count stamp duty, advertising, agent fees, legal).
posted by xdvesper at 12:25 AM on October 4, 2023
a landlord only risks property/money, a tenant is at risk of losing their home - and thus probably all of their property, but also their safety, wellbeing and health, possibly even their life
To that I'd say - within the current system - if 16 months free rent isn't enough, then I think the problem is more systemic / societal in nature and thus not within the scope of interest of a private landlord to resolve, that's a problem I think everyone agrees the public system needs to solve.
It's a different market - we wouldn't criticize private hospitals for not doing the work of public (free) hospitals, at least in Australia they serve different purposes and in fact work alongside each other (literally, often get built side by side). In fact, private hospitals are an essential part of the system taking the load off the public system. You could argue the public system is underfunded for elective surgeries in the first place and therefore we wouldn't need private hospitals if they were funded properly, but private hospitals are the solution, not the problem - the problem lies with the underfunding.
+1 for tenant protection in Australia not actually being all that great.
I think maybe the problem is access to justice, which is a problem on both sides. Once you do get in front of the tribunal they make fair decisions based in the law - interesting fact the tribunal members earn $260,000 per year, they are appointed by the Governor in Council for a terms of 7 years, it's virtually impossible to appeal unless they have made an error in law, and their decisions are binding. It sounds like the Supreme Court!
As a tenant - once we caused some damage - one of my guests was drunk, and pulled out the towel rail from the wall, causing plaster damage and a broken rail. Landlord applied to VCAT to claim damages on the bond, we contested. At the tribunal they said that taking into account all the evidence - many years of trouble free rent and generally good condition of the property - the landlord must accept some level of property damage as part of the wear and tear of the property and so their application for compensation was denied.
As a landlord I've also had experience with VCAT for eviction / bond claims, and it's just a really slow process since tenants are prioritized (demand for repairs are seen very quickly, while landlord request for bond claim takes 2-3 years right now). The tribunal member does make every effort to accommodate the tenant's situation - income, personal hardship, disability - coming to an outcome that balances their needs and rights against the landlord's. And, as has been mentioned, knowing that a decision on one hand can leave a tenant homeless, while a decision on the other hand will just leave the landlord financially disadvantaged, you would see every leeway given to the tenant. In our case, it was pretty clear cut that the tenant had made no effort to pay rent since the beginning of the tenancy. If the tenant had offered to negotiate and pay what they could afford - maybe pay 50% of the amount per month - and they were genuinely struggling - the tribunal might have well have sided with the tenant and given them another 6 months extension to find another source of accommodation and ordered us to simply continue receiving the 50% rent as the best societal outcome.
posted by xdvesper at 1:26 AM on October 4, 2023
To that I'd say - within the current system - if 16 months free rent isn't enough, then I think the problem is more systemic / societal in nature and thus not within the scope of interest of a private landlord to resolve, that's a problem I think everyone agrees the public system needs to solve.
It's a different market - we wouldn't criticize private hospitals for not doing the work of public (free) hospitals, at least in Australia they serve different purposes and in fact work alongside each other (literally, often get built side by side). In fact, private hospitals are an essential part of the system taking the load off the public system. You could argue the public system is underfunded for elective surgeries in the first place and therefore we wouldn't need private hospitals if they were funded properly, but private hospitals are the solution, not the problem - the problem lies with the underfunding.
+1 for tenant protection in Australia not actually being all that great.
I think maybe the problem is access to justice, which is a problem on both sides. Once you do get in front of the tribunal they make fair decisions based in the law - interesting fact the tribunal members earn $260,000 per year, they are appointed by the Governor in Council for a terms of 7 years, it's virtually impossible to appeal unless they have made an error in law, and their decisions are binding. It sounds like the Supreme Court!
As a tenant - once we caused some damage - one of my guests was drunk, and pulled out the towel rail from the wall, causing plaster damage and a broken rail. Landlord applied to VCAT to claim damages on the bond, we contested. At the tribunal they said that taking into account all the evidence - many years of trouble free rent and generally good condition of the property - the landlord must accept some level of property damage as part of the wear and tear of the property and so their application for compensation was denied.
As a landlord I've also had experience with VCAT for eviction / bond claims, and it's just a really slow process since tenants are prioritized (demand for repairs are seen very quickly, while landlord request for bond claim takes 2-3 years right now). The tribunal member does make every effort to accommodate the tenant's situation - income, personal hardship, disability - coming to an outcome that balances their needs and rights against the landlord's. And, as has been mentioned, knowing that a decision on one hand can leave a tenant homeless, while a decision on the other hand will just leave the landlord financially disadvantaged, you would see every leeway given to the tenant. In our case, it was pretty clear cut that the tenant had made no effort to pay rent since the beginning of the tenancy. If the tenant had offered to negotiate and pay what they could afford - maybe pay 50% of the amount per month - and they were genuinely struggling - the tribunal might have well have sided with the tenant and given them another 6 months extension to find another source of accommodation and ordered us to simply continue receiving the 50% rent as the best societal outcome.
posted by xdvesper at 1:26 AM on October 4, 2023
I mean, the reason the landlords have the time and emotional energy to write gigantic “pity me” screeds and the tenants don't is because as tenants we're just so exhausted from being trapped in places we have virtually no control over at all, and no idea of a future where we do have that modicum of self determinations.
posted by ambrosen at 2:19 AM on October 4, 2023 [8 favorites]
posted by ambrosen at 2:19 AM on October 4, 2023 [8 favorites]
People talking about how some people “need” to be landlords in order to buy a house (renting out a second unit in the house) for their own economic security as if co-ops aren’t a thing. The only reason to be a landlord in that circumstance is either a desire for control over your neighbors and their living situation, beyond the control you’d get when setting up the building as a co-op by unilaterally setting the co-op rules and then initially choosing your neighbor; or a desire to profit above and beyond the financial security that comes from living in a home that you own instead of rent, where said profit doesn’t just magically appear but is a direct wealth transfer from the tenant to the landlord, extracting from the value of the tenant’s labor (or however they make their income).
You could also incorporate a condo corporation to manage a multi/unit building, where you have a principle share, if you’re not into co-ops for whatever reason. Same critique applies that the only reasons not to do so are wanting to exert control over your neighbors living situation or wanting extractive profits.
posted by eviemath at 4:04 AM on October 4, 2023 [3 favorites]
You could also incorporate a condo corporation to manage a multi/unit building, where you have a principle share, if you’re not into co-ops for whatever reason. Same critique applies that the only reasons not to do so are wanting to exert control over your neighbors living situation or wanting extractive profits.
posted by eviemath at 4:04 AM on October 4, 2023 [3 favorites]
VCAT would put you in Victoria. So I was correct, you are in the only part of the country even attempting to implement any sort of tenant protections. And it sounds like you've benefitted from them, too.
a decision on one hand can leave a tenant homeless, while a decision on the other hand will just leave the landlord financially disadvantaged
One of these things is not like the other. Once you are homeless, it is extremely difficult to get back into housing. A financial hit is unpleasant, but risk is inherent in all investment. If you can't cope, opt to take one of the less intense options you so kindly listed.
based on many people I know and personal experience, many people end up with properties to rent out due to changes in circumstance, not a deliberate desire to invest and become a landlord.
Cool, half of rentals are owned by landlords with multiple properties (make sure you count the properties on that chart properly, incidentally, not just the people - you need to multiply the people by the properties they hold to get the correct figures). And historically new investor loans sit between 30 and 40% of all new mortgages, so evidently there are a lot of people making the decision to buy an investment property each year.
The people you're talking about exist, no question, but they are vastly outnumbered by people who deliberately purchase an investment property, and many of those have a portfolio with multiple properties. And about half of rentals on the market are negatively geared, (ie, rent at a loss), because the rental income isn't the investment - the land and the house itself is.
It's the flipside to the myth of the scrappy mum-and-dad investor - it's shitty for mum-and-dad investors as well as being shitty for tenants. Buying a rental with a mortgage is a crappy way to make any sort of income and is mostly used for the tax credits for people with larger, more diverse portfolios. I can't find the cite, but I read an article recently where a tax accountant basically said that many of the landlords who have low taxable income are cash-poor but investment-rich, and leverage what they have to keep their tax bills as low as possible and as a result can't be taken as low income on face value.
But there's a huge idea that property is a safe investment that will never go down in value and you wind up with people attempting to be landlords who have no capacity for it, and when they fail because they are frankly terrible at it, never make any rental income worth talking about, they spend their time terrorising their tenants before throwing in the towel and still making a profit because the fucking property market is cooked. And then more mum and dads come along, get fried, and fuck their tenants over in the process. Like the myth has to go. The tenants overwhelmingly bear the brunt of the damage done but it's a shitty way to run a housing strategy all round.
posted by Jilder at 5:41 AM on October 4, 2023 [4 favorites]
a decision on one hand can leave a tenant homeless, while a decision on the other hand will just leave the landlord financially disadvantaged
One of these things is not like the other. Once you are homeless, it is extremely difficult to get back into housing. A financial hit is unpleasant, but risk is inherent in all investment. If you can't cope, opt to take one of the less intense options you so kindly listed.
based on many people I know and personal experience, many people end up with properties to rent out due to changes in circumstance, not a deliberate desire to invest and become a landlord.
Cool, half of rentals are owned by landlords with multiple properties (make sure you count the properties on that chart properly, incidentally, not just the people - you need to multiply the people by the properties they hold to get the correct figures). And historically new investor loans sit between 30 and 40% of all new mortgages, so evidently there are a lot of people making the decision to buy an investment property each year.
The people you're talking about exist, no question, but they are vastly outnumbered by people who deliberately purchase an investment property, and many of those have a portfolio with multiple properties. And about half of rentals on the market are negatively geared, (ie, rent at a loss), because the rental income isn't the investment - the land and the house itself is.
It's the flipside to the myth of the scrappy mum-and-dad investor - it's shitty for mum-and-dad investors as well as being shitty for tenants. Buying a rental with a mortgage is a crappy way to make any sort of income and is mostly used for the tax credits for people with larger, more diverse portfolios. I can't find the cite, but I read an article recently where a tax accountant basically said that many of the landlords who have low taxable income are cash-poor but investment-rich, and leverage what they have to keep their tax bills as low as possible and as a result can't be taken as low income on face value.
But there's a huge idea that property is a safe investment that will never go down in value and you wind up with people attempting to be landlords who have no capacity for it, and when they fail because they are frankly terrible at it, never make any rental income worth talking about, they spend their time terrorising their tenants before throwing in the towel and still making a profit because the fucking property market is cooked. And then more mum and dads come along, get fried, and fuck their tenants over in the process. Like the myth has to go. The tenants overwhelmingly bear the brunt of the damage done but it's a shitty way to run a housing strategy all round.
posted by Jilder at 5:41 AM on October 4, 2023 [4 favorites]
I was struck by this line: the story cites a real estate industry survey reporting that 60 percent of landlords own only one building. But elsewhere, it admits that 12 percent of the city’s landlords owned the vast majority of rental units: 71 percent.
Well, yes. If A has 998 properties, B has 999, and C, D & E have 1 each, a "majority of owners" have only 1 property. That is some fundamental mathematical dishonesty there.
At the moment I rent, in the sense that I pay rent to a housemate, whose name is on the deed to the house we all live in and who pays the mortgage, taxes, utility bills, repair bills, and so forth. I rather doubt said housemate would self-identify as a landlord, though.
You can see the bones of the co-op model in the story of some friends of mine. They acted as property managers by collecting rent checks and administering basic expenses in return for a small discount on their rent. The absentee landlord was shady in other ways and eventually fled the country to avoid prosecution. My friends kept collecting rent checks and made a separate bank account for them, expecting to hear from the authorities or a new owner or something. When that didn't happen after a while and bills kept coming in, they started paying bills out of the rent account and keeping very scrupulous records. One of the tenants worked out what was happening and stopped paying rent and they just shrugged and went on, because it's not like they could do anything about it. They just didn't rennovate his apartment when they did the rest of the complex (they did give themselves the nicest renovation, but they did work with the tenants on what they wanted done). This went on for years, until one day someone showed up, having bought the property at a tax auction and expecting to find an abandoned building on the verge of collapse. The new owner kept my friends on as property managers because a well-maintained and fully occupied complex was certainly worth more than a derelict building, though he did evict the guy who wasn't paying rent and raise everyone else's rent to "market rates". They moved to their own house a couple of years later, but it had been a nice run for a while there.
posted by Karmakaze at 6:39 AM on October 4, 2023 [1 favorite]
Well, yes. If A has 998 properties, B has 999, and C, D & E have 1 each, a "majority of owners" have only 1 property. That is some fundamental mathematical dishonesty there.
At the moment I rent, in the sense that I pay rent to a housemate, whose name is on the deed to the house we all live in and who pays the mortgage, taxes, utility bills, repair bills, and so forth. I rather doubt said housemate would self-identify as a landlord, though.
You can see the bones of the co-op model in the story of some friends of mine. They acted as property managers by collecting rent checks and administering basic expenses in return for a small discount on their rent. The absentee landlord was shady in other ways and eventually fled the country to avoid prosecution. My friends kept collecting rent checks and made a separate bank account for them, expecting to hear from the authorities or a new owner or something. When that didn't happen after a while and bills kept coming in, they started paying bills out of the rent account and keeping very scrupulous records. One of the tenants worked out what was happening and stopped paying rent and they just shrugged and went on, because it's not like they could do anything about it. They just didn't rennovate his apartment when they did the rest of the complex (they did give themselves the nicest renovation, but they did work with the tenants on what they wanted done). This went on for years, until one day someone showed up, having bought the property at a tax auction and expecting to find an abandoned building on the verge of collapse. The new owner kept my friends on as property managers because a well-maintained and fully occupied complex was certainly worth more than a derelict building, though he did evict the guy who wasn't paying rent and raise everyone else's rent to "market rates". They moved to their own house a couple of years later, but it had been a nice run for a while there.
posted by Karmakaze at 6:39 AM on October 4, 2023 [1 favorite]
Jilder - I think the stats you link did come up earlier. As per the stats, out of 2.2 mil Australian landlords, 90% of them own 2 or less properties. This perfectly jives with my experience, where the vast majority of people I know who are landlords came into it by happenstance.
The other way you're looking at it - out of the rentals you see, how many are by landlords who own 1-2 properties - well, out of 10 mil households, 6.7 mil are owner occupiers, and 3.3 mil are renters. So out of 3.3 mil rental properties, 1.6 mil x 1 + 0.4 mil x 2 = 2.4 mil are rented out by landlords who own 2 or less rental properties, or 73%.
Whether you say 90% of landlords own 2 or less properties or 73% of rentals on the market are owned by landlords with 2 or less properties, I'm pretty comfortable in calling that the norm.
In the US it would be a different matter with mega-corporations owning rental units by the thousands. And part of the reason Australia is majority mom-and-pop landlords, is, I have heard, attributed to the very negative gearing laws that are being decried in this thread - because individuals have the ability to tax-deduct investment property losses into a different income stream, while corporations do not. Of course, it's not to say it's impossible for corporations to get into the rental market in Australia, some do, but the fact is individual investors have been given a specific leg up to allow them to compete with corporates.
I don't think that accountant's interpretation makes sense. The purpose of negative gearing an investment property is to reduce your marginal tax paid, yes, but you really benefit from it at high marginal rates (like, 45% over $180,000, so every $1 of income you reduce you save $0.45). If you're declaring low income, and paying barely any tax, there is literally no benefit to negative gearing. Why would someone negative gear a property when their income is already so low? Even if you work it out by steps, it doesn't make sense - average negative gearing loss is $8,400, so how would you define a "low income" person - like $60,000 a year? Then one property would reduce their taxable income by $8,400 down to $51,600, and save them a whopping $2,700 in tax per year... what a rort! If we're saying someone on $60,000 per year could afford to buy an investment property for the purpose of reducing their taxable income, or even multiple investment properties, that's just entirely fiction. Everyone can afford multiple houses now!
posted by xdvesper at 6:47 AM on October 4, 2023
The other way you're looking at it - out of the rentals you see, how many are by landlords who own 1-2 properties - well, out of 10 mil households, 6.7 mil are owner occupiers, and 3.3 mil are renters. So out of 3.3 mil rental properties, 1.6 mil x 1 + 0.4 mil x 2 = 2.4 mil are rented out by landlords who own 2 or less rental properties, or 73%.
Whether you say 90% of landlords own 2 or less properties or 73% of rentals on the market are owned by landlords with 2 or less properties, I'm pretty comfortable in calling that the norm.
In the US it would be a different matter with mega-corporations owning rental units by the thousands. And part of the reason Australia is majority mom-and-pop landlords, is, I have heard, attributed to the very negative gearing laws that are being decried in this thread - because individuals have the ability to tax-deduct investment property losses into a different income stream, while corporations do not. Of course, it's not to say it's impossible for corporations to get into the rental market in Australia, some do, but the fact is individual investors have been given a specific leg up to allow them to compete with corporates.
I don't think that accountant's interpretation makes sense. The purpose of negative gearing an investment property is to reduce your marginal tax paid, yes, but you really benefit from it at high marginal rates (like, 45% over $180,000, so every $1 of income you reduce you save $0.45). If you're declaring low income, and paying barely any tax, there is literally no benefit to negative gearing. Why would someone negative gear a property when their income is already so low? Even if you work it out by steps, it doesn't make sense - average negative gearing loss is $8,400, so how would you define a "low income" person - like $60,000 a year? Then one property would reduce their taxable income by $8,400 down to $51,600, and save them a whopping $2,700 in tax per year... what a rort! If we're saying someone on $60,000 per year could afford to buy an investment property for the purpose of reducing their taxable income, or even multiple investment properties, that's just entirely fiction. Everyone can afford multiple houses now!
posted by xdvesper at 6:47 AM on October 4, 2023
Because the alternative would be, what exactly?
others have spoken to this in the thread, but I think the question strikes at the heart of things: in my lifetime, the way people have internalized the notion that housing is an investment vehicle for income is a relatively new thing, or new to my awareness. And when I say 'people' I mean: suddenly, almost everyone. In the past few decades, the buying/flipping activity ramped up but I also saw people buying to rent out. I contrast this with a few generations back, i.e. former in-laws, where it was not uncommon to buy a property and rent out a portion of it, but the intention was always to live there and use the rental income to pay off the mortgage more quickly.
There are alternatives. The trouble with regulation as posited in my earlier comment is the speed of regulatory capture and/or the capacity to simply work around tweaks to the system, it's outpacing any net benefits to society. The wealth impulse is winning the race. "Good landlord" stories will, I suspect, become increasingly rare, as the wealth gap widens, people get more desperate, social bonds continue to deteriorate, and people can no longer "afford" to be good landlords.
So alternatives require radical change, not incremental regulatory change, as far as I can tell. Where I live, a model that is flourishing is the Hutterite community. Two new colonies in my area in the past 10 years: communal ownership of property, farming based society, extremely patriarchal and insular to some degree. Strip away the industrialized approach to farming and you have a village/community that resembles much of what you'd find in portions of Europe during a given period. I'm not suggesting this is a model to emulate, but it serves sufficiently as contrast to our current norm.
posted by elkevelvet at 7:30 AM on October 4, 2023 [2 favorites]
others have spoken to this in the thread, but I think the question strikes at the heart of things: in my lifetime, the way people have internalized the notion that housing is an investment vehicle for income is a relatively new thing, or new to my awareness. And when I say 'people' I mean: suddenly, almost everyone. In the past few decades, the buying/flipping activity ramped up but I also saw people buying to rent out. I contrast this with a few generations back, i.e. former in-laws, where it was not uncommon to buy a property and rent out a portion of it, but the intention was always to live there and use the rental income to pay off the mortgage more quickly.
There are alternatives. The trouble with regulation as posited in my earlier comment is the speed of regulatory capture and/or the capacity to simply work around tweaks to the system, it's outpacing any net benefits to society. The wealth impulse is winning the race. "Good landlord" stories will, I suspect, become increasingly rare, as the wealth gap widens, people get more desperate, social bonds continue to deteriorate, and people can no longer "afford" to be good landlords.
So alternatives require radical change, not incremental regulatory change, as far as I can tell. Where I live, a model that is flourishing is the Hutterite community. Two new colonies in my area in the past 10 years: communal ownership of property, farming based society, extremely patriarchal and insular to some degree. Strip away the industrialized approach to farming and you have a village/community that resembles much of what you'd find in portions of Europe during a given period. I'm not suggesting this is a model to emulate, but it serves sufficiently as contrast to our current norm.
posted by elkevelvet at 7:30 AM on October 4, 2023 [2 favorites]
That's a very broad brush that eviemath is painting with in that comment above about live-in landlords with small multiunit houses. Inaccurate in some cases, too, I'd say, but perhaps my crass desire for authoritarian power is just deceiving me about that.
I honestly don't know enough about the details of coop unit buildings, the legal structures around them, how involved it is to convert a building to a coop, or what effect widespread shifting to coops has on an area, but turning rental-apartment buildings into condos is generally *terrible* for a rental market. Rental units become harder to find and having things converted to condos but then rented out typically involves an upwards step-function in rents, which pushes the overall rental market and not in a good direction.
Nearly all newly created condo units are sold to buyers who live in them. This removes them from the rental market and increases demand for the remaining rental units in an area. An individual condo unit typically sells at (and is property-taxed at) a high enough premium compared to a similar fraction of the price of the multifamily house, even if it was at par without overall property value changes. This means that if a new owner wanted to turn around and rent out a newly purchased unit, it would require rents much higher than it would've commanded as a plain old rental unit, again making it harder for renters to afford. Also, the conversion itself can be difficult and time consuming and expensive. There are some pretty strict rules in place in some areas about how condo conversions are handled (mostly to be sure someone doesn't buy an occupied building and condo-ize it out from under the current residents with almost no notice and which is likely remove the units from the rental market entirely while displacing a renter who may not have the means to purchase a condo even at a reduced rate.)
As for alternatives, I know of some very-long-running cohousing communities both in the city and out in the burbs and it seems to be a lot more community minded and less predatory overall. But I don't know if the economics around cohousing support rental units in a cohousing community or if you're, again, limiting yourself to people who have the means to get a mortgage for a place.
posted by rmd1023 at 8:20 AM on October 4, 2023 [1 favorite]
I honestly don't know enough about the details of coop unit buildings, the legal structures around them, how involved it is to convert a building to a coop, or what effect widespread shifting to coops has on an area, but turning rental-apartment buildings into condos is generally *terrible* for a rental market. Rental units become harder to find and having things converted to condos but then rented out typically involves an upwards step-function in rents, which pushes the overall rental market and not in a good direction.
Nearly all newly created condo units are sold to buyers who live in them. This removes them from the rental market and increases demand for the remaining rental units in an area. An individual condo unit typically sells at (and is property-taxed at) a high enough premium compared to a similar fraction of the price of the multifamily house, even if it was at par without overall property value changes. This means that if a new owner wanted to turn around and rent out a newly purchased unit, it would require rents much higher than it would've commanded as a plain old rental unit, again making it harder for renters to afford. Also, the conversion itself can be difficult and time consuming and expensive. There are some pretty strict rules in place in some areas about how condo conversions are handled (mostly to be sure someone doesn't buy an occupied building and condo-ize it out from under the current residents with almost no notice and which is likely remove the units from the rental market entirely while displacing a renter who may not have the means to purchase a condo even at a reduced rate.)
As for alternatives, I know of some very-long-running cohousing communities both in the city and out in the burbs and it seems to be a lot more community minded and less predatory overall. But I don't know if the economics around cohousing support rental units in a cohousing community or if you're, again, limiting yourself to people who have the means to get a mortgage for a place.
posted by rmd1023 at 8:20 AM on October 4, 2023 [1 favorite]
if 16 months free rent isn't enough
No one is arguing that individual landlords have a personal responsibility to house the general public for free. But all this casuistry is not going to obscure the fact that someone who might be burned to death, or have their kids breathing in thick clouds of lead dust due to renovations that ignore safety regulations (case I worked on myself), or be assaulted, or lose all their meager belongings in a plumbing disaster, or have their security deposit stolen, or feel like they have to humor if not give in to someone demanding sexual favors, is in a vulnerable position compared to the person who owns multiple properties and might lose some money. Without some understanding of that, it is not possible to be an ethical landlord under any system.
posted by praemunire at 8:25 AM on October 4, 2023 [11 favorites]
No one is arguing that individual landlords have a personal responsibility to house the general public for free. But all this casuistry is not going to obscure the fact that someone who might be burned to death, or have their kids breathing in thick clouds of lead dust due to renovations that ignore safety regulations (case I worked on myself), or be assaulted, or lose all their meager belongings in a plumbing disaster, or have their security deposit stolen, or feel like they have to humor if not give in to someone demanding sexual favors, is in a vulnerable position compared to the person who owns multiple properties and might lose some money. Without some understanding of that, it is not possible to be an ethical landlord under any system.
posted by praemunire at 8:25 AM on October 4, 2023 [11 favorites]
we will have to be creative and willing to re-expand the spectrum of housing options. I swear to god I don't want to see favelas and shanty towns grow permanent in my city, but that's gotta be better than a shopping cart. And this could be avoided if we would cut more houses into micro-units, and allowed small-scale construction and modular builds.
One of the things that I struggle with is how to allow people choice without completely removing tenant protections. Ultimately, I am not sure it's possible.
For example, when I have been a renter, there were a lot of times when I would cheerfully take a semi-broken down place in exchange for, say, a 50% discount on rent. That option, however, doesn't exist. And it doesn't exist often for a lot of good reasons, because if people are allowed not to fix things and to rent out broken places, most of the people doing so will not in fact offer that 50% discount on rent, and many will attempt to charge full price. And also, because it's hard for a tenant to tell the difference between broken down in a mildly annoying way, and broken down in a way that's going to be a serious safety concern for anyone who lives there.
And so actually, I kind of find myself in a weirdly terrible position, where I have access to housing that I *could* rent out at massively well below market rates while I'm in school elsewhere, but I can't afford to fix up to the appropriate standard to be a good landlord and I also don't want to be a bad landlord (or really a landlord at all but that's a side issue) and it's so easy to do. And people are wanting me to do it, like, wanting me to rent space to them, and they're confused about why I care so much about that stuff, and I don't know how to explain it to them, and so I feel like a double asshole because I'm saying no. And that seems bad - like, here there's housing and it would be good to give it to people? But also impossible to do. And so I get those tensions. But also, as people are saying above, most of the time people get screwed by this stuff, and more of the time people are being screwed by lack of restrictions than they are by the restrictions.
posted by corb at 8:58 AM on October 4, 2023 [3 favorites]
One of the things that I struggle with is how to allow people choice without completely removing tenant protections. Ultimately, I am not sure it's possible.
For example, when I have been a renter, there were a lot of times when I would cheerfully take a semi-broken down place in exchange for, say, a 50% discount on rent. That option, however, doesn't exist. And it doesn't exist often for a lot of good reasons, because if people are allowed not to fix things and to rent out broken places, most of the people doing so will not in fact offer that 50% discount on rent, and many will attempt to charge full price. And also, because it's hard for a tenant to tell the difference between broken down in a mildly annoying way, and broken down in a way that's going to be a serious safety concern for anyone who lives there.
And so actually, I kind of find myself in a weirdly terrible position, where I have access to housing that I *could* rent out at massively well below market rates while I'm in school elsewhere, but I can't afford to fix up to the appropriate standard to be a good landlord and I also don't want to be a bad landlord (or really a landlord at all but that's a side issue) and it's so easy to do. And people are wanting me to do it, like, wanting me to rent space to them, and they're confused about why I care so much about that stuff, and I don't know how to explain it to them, and so I feel like a double asshole because I'm saying no. And that seems bad - like, here there's housing and it would be good to give it to people? But also impossible to do. And so I get those tensions. But also, as people are saying above, most of the time people get screwed by this stuff, and more of the time people are being screwed by lack of restrictions than they are by the restrictions.
posted by corb at 8:58 AM on October 4, 2023 [3 favorites]
Mom and pop landlords may get screwed here and there and make for good PR cover for the big corps, but at least here in Chicago a lot of the tenant protections don't apply if the owner lives on the property or the property is 4 units or fewer. (Which, in a city full of 2- and 3- flats, is a LOT of the mom and pop landlords.) So the tenants who get screwed by those small time landlords have less recourse.
posted by misskaz at 8:58 AM on October 4, 2023 [1 favorite]
posted by misskaz at 8:58 AM on October 4, 2023 [1 favorite]
I'm currently a double involuntary [1] landlord and am of the opinion that BC's tenant protection are too weak even though all you hear out of small landlords is how they are being abused by the system. I have very little to no sympathy for these whiners.
[1] I'm currently renting out my mother's place while it winds thru probate and the in house suite we keep for my kid while she's away at school. The first essentially to have someone around for insurance purposes and the latter because my kid begged me to help their friend negotiate a housing crisis. Both are being rented at essentially out of pocket expense recovery levels about 20% of market rate and I'll be well glad to revert to just being a homeowner, along with my bank, once these two arrangements end.
posted by Mitheral at 9:53 AM on October 4, 2023
[1] I'm currently renting out my mother's place while it winds thru probate and the in house suite we keep for my kid while she's away at school. The first essentially to have someone around for insurance purposes and the latter because my kid begged me to help their friend negotiate a housing crisis. Both are being rented at essentially out of pocket expense recovery levels about 20% of market rate and I'll be well glad to revert to just being a homeowner, along with my bank, once these two arrangements end.
posted by Mitheral at 9:53 AM on October 4, 2023
there were a lot of times when I would cheerfully take a semi-broken down place in exchange for, say, a 50% discount on rent
For a few years recently, I lived in a place where the owner had bought a few adjoining early 20C properties back in the 70s when they must have all together cost two and three-quarters cans of spam, fixed them up for a contemporary tax break that put the units into rent stabilization which expired a few years before I moved in, and then maintained them at an adequate level but renovated only when absolutely necessary. I looked them up; he has an interest-only mortgage on them that he rolls over every seven years or so. My kitchen was instantly recognizable to anyone Gen X or older as late 70s/maaaaaybe early 80s vintage. The floors were uneven enough that I had to use levelers on tables, etc. (but honestly I loved them, such character). But everything was safe and clean (at least by NYC standards) and the rent was startlingly reasonable for the area and increased at very modest increments even though it wasn't stabilized anymore. It was the kind of deal I feel you could find often when I was younger and now struggle to. One of the reasons I moved was that simple math was telling me the guy had to be getting to, if not at, retirement age, and eventually either his kids or whoever his kids sold to would start putting the screws on.
posted by praemunire at 10:27 AM on October 4, 2023 [1 favorite]
For a few years recently, I lived in a place where the owner had bought a few adjoining early 20C properties back in the 70s when they must have all together cost two and three-quarters cans of spam, fixed them up for a contemporary tax break that put the units into rent stabilization which expired a few years before I moved in, and then maintained them at an adequate level but renovated only when absolutely necessary. I looked them up; he has an interest-only mortgage on them that he rolls over every seven years or so. My kitchen was instantly recognizable to anyone Gen X or older as late 70s/maaaaaybe early 80s vintage. The floors were uneven enough that I had to use levelers on tables, etc. (but honestly I loved them, such character). But everything was safe and clean (at least by NYC standards) and the rent was startlingly reasonable for the area and increased at very modest increments even though it wasn't stabilized anymore. It was the kind of deal I feel you could find often when I was younger and now struggle to. One of the reasons I moved was that simple math was telling me the guy had to be getting to, if not at, retirement age, and eventually either his kids or whoever his kids sold to would start putting the screws on.
posted by praemunire at 10:27 AM on October 4, 2023 [1 favorite]
in my lifetime, the way people have internalized the notion that housing is an investment vehicle for income is a relatively new thing, or new to my awareness.
This is really interesting. In the UK historically it is the opposite. In 1900, 90% of the population rented and the vast majority of those were owned by people as investment vehicles rented out for profit. It wasn't the poorest 90% either, many people in the top 10% leased London properties from the Duke of Westminster and other landlords. That changed in the 1920s and 1930s when mortgages became realistic opportunities for middle and upper working class people. Modern small landlords are very much a 1990s and later phenomenon.
posted by plonkee at 1:22 PM on October 4, 2023
This is really interesting. In the UK historically it is the opposite. In 1900, 90% of the population rented and the vast majority of those were owned by people as investment vehicles rented out for profit. It wasn't the poorest 90% either, many people in the top 10% leased London properties from the Duke of Westminster and other landlords. That changed in the 1920s and 1930s when mortgages became realistic opportunities for middle and upper working class people. Modern small landlords are very much a 1990s and later phenomenon.
posted by plonkee at 1:22 PM on October 4, 2023
in my lifetime, the way people have internalized the notion that housing is an investment vehicle for income is a relatively new thing, or new to my awareness.
Housing has always been an investment vehicle for income, specifically rental income. It's more modern that housing has become an asset class owned specifically for speculation value, ie: holding back the amount constructed such that appreciation simply via ownership surpasses rental income, in that actual renters are occasionally considered detrimental. Occasionally - not nearly as often as many suppose.
Mostly due to a whole bunch of tax laws that have been changed from the 1950s on, at least in the US.
posted by The_Vegetables at 2:04 PM on October 4, 2023 [1 favorite]
Housing has always been an investment vehicle for income, specifically rental income. It's more modern that housing has become an asset class owned specifically for speculation value, ie: holding back the amount constructed such that appreciation simply via ownership surpasses rental income, in that actual renters are occasionally considered detrimental. Occasionally - not nearly as often as many suppose.
Mostly due to a whole bunch of tax laws that have been changed from the 1950s on, at least in the US.
posted by The_Vegetables at 2:04 PM on October 4, 2023 [1 favorite]
Housing has always been an investment vehicle for income, specifically rental income
I don't know that a lot of these situations are necessarily people intending to create rental income, so much as things getting more expensive and people no longer being able to afford the things they have without coming up with creative solutions. But it also occurs to me that the lack of good solutions may also be what's driving the rise of AirBnBing rooms in homes - people aren't confident enough that they'll be able to be good landlords, so they become short term hoteliers instead because there appear to be less rules around it. Meanwhile, that's then a loss for the actual housing market.
posted by corb at 3:22 PM on October 4, 2023 [2 favorites]
I don't know that a lot of these situations are necessarily people intending to create rental income, so much as things getting more expensive and people no longer being able to afford the things they have without coming up with creative solutions. But it also occurs to me that the lack of good solutions may also be what's driving the rise of AirBnBing rooms in homes - people aren't confident enough that they'll be able to be good landlords, so they become short term hoteliers instead because there appear to be less rules around it. Meanwhile, that's then a loss for the actual housing market.
posted by corb at 3:22 PM on October 4, 2023 [2 favorites]
I'm an an owner and rent out part of my house under our town's "accessory apartment" rules, requiring that I live in the house (there are some other situations, whole-house rentals where the owner is not required to live on site.) I understand there are reasons to hate some proprietors but this hatred of all owners I see here and elsewhere is really stunning.
I get it with the large corporate owners who jack up rents at every opportunity but I and a number of other small owners do not. There are a lot of us, many older people trying to keep up with tax increases by renting out part of an empty nest.
Getting rid of a bad tenant--such as a case I know of personally (but not mine) who refused to pay rent for nine months, jammed up the plumbing system and regularly had drug parties in the house--can be a nightmare. Before you tell me the landlord should have evicted them, yes, eventually she was evicted but because courts are backed up, it can take up to a year here, even without the Covid moratorium, and in this case, not before doing further damage by putting holes in the wall and pouring food into it when she moved out so the sheetrock had to be removed and replaced.
I have nearly entirely avoided this though I had one tenant who was borderline crazy, complained daily about things out of my control, got into arguments with the neighbors and the postman to the point where he stopped delivering the mail for a week, and then, separately, accused me of stopping her mail, accused me of trying to poison her, a breast cancer survivor, when I, also a breast cancer survivor, put down Diatomaceous earth to keep the crickets away, and at her most paranoid moment, said I had interfered with her wifi, which she planned to contact the FCC about.
Here on Long Island, there is extreme resistance to apartments in most locations. I also cover this as a local news site owner and see this sentiment expressed all over social media and in person. In June, I covered a meeting where the vast majority fiercely, fiercely opposed allowing new apartments in basements, which had been legal just two years ago.
Some of the statements made to the town board?
"Would these people (referring to tenants) be allowed to vote?" "What about the pedophiles who will move in?" "They will change the complexion of our town" "they will pack the schools (even though enrollment rates have fallen, a lot, in recent years) and on and on. The town withdrew the proposal. A young, gay, disabled person who pleaded with the board to allow more apartments was mocked by the crowd.
Accessory apartment owners are held to stiff requirements, more than those who rent out entire homes. For example, my whole house, room by room, has to be inspected every two years, and my taxes are higher because allegedly I'm creating more trash, for example, even though there are fewer people in my house than any other on the block. My streetlight and fire service and ambulance taxes are higher; Neither my tenant nor I are allowed to park on the street.
We are estimated to be thousands of apartments short of the demand in this single-family alleged paradise.
So I provide a place, where I raise the rent only when a new tenant comes in, meaning every three or four years. I didn't raise the rent even after last year when inflation sent my fuel oil bill and repair bills through the roof.
I get a little tired of being labeled as some sort of parasite (not here, so far) because of how I'm trying to get by. If I were to take my apartment off the market, that would just make it that much harder for someone to rent here.
And the one that really gets me is people complaining that property owners are somehow horrible because they make money by renting out their property. It's a business for some; as long as they're being good owners and not being jerks jacking up the rent to the max, what is wrong with that kind of business?
posted by etaoin at 6:05 PM on October 4, 2023 [1 favorite]
I get it with the large corporate owners who jack up rents at every opportunity but I and a number of other small owners do not. There are a lot of us, many older people trying to keep up with tax increases by renting out part of an empty nest.
Getting rid of a bad tenant--such as a case I know of personally (but not mine) who refused to pay rent for nine months, jammed up the plumbing system and regularly had drug parties in the house--can be a nightmare. Before you tell me the landlord should have evicted them, yes, eventually she was evicted but because courts are backed up, it can take up to a year here, even without the Covid moratorium, and in this case, not before doing further damage by putting holes in the wall and pouring food into it when she moved out so the sheetrock had to be removed and replaced.
I have nearly entirely avoided this though I had one tenant who was borderline crazy, complained daily about things out of my control, got into arguments with the neighbors and the postman to the point where he stopped delivering the mail for a week, and then, separately, accused me of stopping her mail, accused me of trying to poison her, a breast cancer survivor, when I, also a breast cancer survivor, put down Diatomaceous earth to keep the crickets away, and at her most paranoid moment, said I had interfered with her wifi, which she planned to contact the FCC about.
Here on Long Island, there is extreme resistance to apartments in most locations. I also cover this as a local news site owner and see this sentiment expressed all over social media and in person. In June, I covered a meeting where the vast majority fiercely, fiercely opposed allowing new apartments in basements, which had been legal just two years ago.
Some of the statements made to the town board?
"Would these people (referring to tenants) be allowed to vote?" "What about the pedophiles who will move in?" "They will change the complexion of our town" "they will pack the schools (even though enrollment rates have fallen, a lot, in recent years) and on and on. The town withdrew the proposal. A young, gay, disabled person who pleaded with the board to allow more apartments was mocked by the crowd.
Accessory apartment owners are held to stiff requirements, more than those who rent out entire homes. For example, my whole house, room by room, has to be inspected every two years, and my taxes are higher because allegedly I'm creating more trash, for example, even though there are fewer people in my house than any other on the block. My streetlight and fire service and ambulance taxes are higher; Neither my tenant nor I are allowed to park on the street.
We are estimated to be thousands of apartments short of the demand in this single-family alleged paradise.
So I provide a place, where I raise the rent only when a new tenant comes in, meaning every three or four years. I didn't raise the rent even after last year when inflation sent my fuel oil bill and repair bills through the roof.
I get a little tired of being labeled as some sort of parasite (not here, so far) because of how I'm trying to get by. If I were to take my apartment off the market, that would just make it that much harder for someone to rent here.
And the one that really gets me is people complaining that property owners are somehow horrible because they make money by renting out their property. It's a business for some; as long as they're being good owners and not being jerks jacking up the rent to the max, what is wrong with that kind of business?
posted by etaoin at 6:05 PM on October 4, 2023 [1 favorite]
"As per the stats, out of 2.2 mil Australian landlords, 90% of them own 2 or less properties. This perfectly jives with my experience, where the vast majority of people I know who are landlords came into it by happenstance.
You haven't read that correctly. That table is drawn from declared earnings from rentals, and does not count owner-occupier properties at all.
Of 2,245,539 landlords, 1,605,050 own one INVESTMENT property. SO they own two properties, one of which the rent. Not even close to 90%. That stat is not houses overall, it's just investment properties. If you tally up the investment properties, they wind up owning about half of all rentals.
423 468 people own two, for 846 936 rentals overall.
130 376 people own three, for 391 128 rentals.
47 282 people own four, for 189128 rentals.
19 444 people own five, for 97 220 rentals.
19 920 people own six or more, for at least a further 119 520 properties.
This gives us a total of at least 1 643 932 investment properties that are owned by people with three or more residences, one of which they live in. If you're an Australian renter, it's fifty fifty whether you're in a property owned by a small timer or someone with a portfolio. Miles off that 90% mum-and-dad you keep hammering. And I'm really puzzled as to what you think the tens of thousands of people who are taking out investor mortgages each year are doing, exactly.
Your pool of antedate of people just accidentally a rental property is does not in any way represent who is actually renting out properties, and if you want to keep claiming that I'd love to see a reliable cite on it.
Why would someone negative gear a property when their income is already so low?
The critical phrase here is taxable income. If you're a 67 year old retiree drawing down huge sums from your super, you won't pay tax on that. If you're being paid in shares, you won't pay income tax on it (though tax will be taken in other ways). And there are huge swathes of really rich people who just hate paying tax and who will find ways to reduce that taxable income as much as possible.
posted by Jilder at 6:34 PM on October 4, 2023
You haven't read that correctly. That table is drawn from declared earnings from rentals, and does not count owner-occupier properties at all.
Of 2,245,539 landlords, 1,605,050 own one INVESTMENT property. SO they own two properties, one of which the rent. Not even close to 90%. That stat is not houses overall, it's just investment properties. If you tally up the investment properties, they wind up owning about half of all rentals.
423 468 people own two, for 846 936 rentals overall.
130 376 people own three, for 391 128 rentals.
47 282 people own four, for 189128 rentals.
19 444 people own five, for 97 220 rentals.
19 920 people own six or more, for at least a further 119 520 properties.
This gives us a total of at least 1 643 932 investment properties that are owned by people with three or more residences, one of which they live in. If you're an Australian renter, it's fifty fifty whether you're in a property owned by a small timer or someone with a portfolio. Miles off that 90% mum-and-dad you keep hammering. And I'm really puzzled as to what you think the tens of thousands of people who are taking out investor mortgages each year are doing, exactly.
Your pool of antedate of people just accidentally a rental property is does not in any way represent who is actually renting out properties, and if you want to keep claiming that I'd love to see a reliable cite on it.
Why would someone negative gear a property when their income is already so low?
The critical phrase here is taxable income. If you're a 67 year old retiree drawing down huge sums from your super, you won't pay tax on that. If you're being paid in shares, you won't pay income tax on it (though tax will be taken in other ways). And there are huge swathes of really rich people who just hate paying tax and who will find ways to reduce that taxable income as much as possible.
posted by Jilder at 6:34 PM on October 4, 2023
Many people become landlords to make money. Part of this is earned through their labor (property management), which can be extensive! But part is because they pass the requirements to take out the loans required to become a landlord.
It's these loans that are required to get the property so you can turn around and charge higher loans to others that is the problem.
If you can get a loan and rent to me, why can't I just get the loan myself? Race, income, "criminal" background, etc, all put many people in a position where they *can't* get that loan. This two-tiered system makes perfect sense, given the industries (financial industry) and people (land-owners) who control the rules.
Sometimes when people criticize landlords, they are criticizing within this system, and sometimes they are criticizing the whole system.
posted by rebent at 6:40 PM on October 4, 2023 [7 favorites]
It's these loans that are required to get the property so you can turn around and charge higher loans to others that is the problem.
If you can get a loan and rent to me, why can't I just get the loan myself? Race, income, "criminal" background, etc, all put many people in a position where they *can't* get that loan. This two-tiered system makes perfect sense, given the industries (financial industry) and people (land-owners) who control the rules.
Sometimes when people criticize landlords, they are criticizing within this system, and sometimes they are criticizing the whole system.
posted by rebent at 6:40 PM on October 4, 2023 [7 favorites]
But it also occurs to me that the lack of good solutions may also be what's driving the rise of AirBnBing rooms in homes - people aren't confident enough that they'll be able to be good landlords, so they become short term hoteliers instead because there appear to be less rules around it.
The less rules - yes most assuredly. Hotel construction has also dramatically declined in the US - NYC is #3 in the US, 20,000 rooms behind Las Vegas in hotel rooms and for some odd reason #1 for STRs (for example). Guess the rest of the top? It's not Las Vegas and Orlando.
I don't know that a lot of these situations are necessarily people intending to create rental income, so much as things getting more expensive and people no longer being able to afford the things they have without coming up with creative solutions
Historically fewer people in the US rent now than in the past, so at best that is a potential current explanation. But I don't think people who own multiple properties are the among the most financially aggrieved.
posted by The_Vegetables at 8:08 AM on October 5, 2023
The less rules - yes most assuredly. Hotel construction has also dramatically declined in the US - NYC is #3 in the US, 20,000 rooms behind Las Vegas in hotel rooms and for some odd reason #1 for STRs (for example). Guess the rest of the top? It's not Las Vegas and Orlando.
I don't know that a lot of these situations are necessarily people intending to create rental income, so much as things getting more expensive and people no longer being able to afford the things they have without coming up with creative solutions
Historically fewer people in the US rent now than in the past, so at best that is a potential current explanation. But I don't think people who own multiple properties are the among the most financially aggrieved.
posted by The_Vegetables at 8:08 AM on October 5, 2023
> It's a business for some; as long as they're being good owners and not being jerks jacking up the rent to the max, what is wrong with that kind of business?
Monopoly is a zero-sum game, and so can the real real estate market since supply comes online so slowly. "Buy-to-let" is on the outright evil axis, while renting out space in your own home is the opposite of that.
Ideally our tax system would incentivize the latter and not the former, but in reality in the USA we have things like Section 8 subsidizing the former.
posted by Heywood Mogroot III at 4:35 PM on October 5, 2023
Monopoly is a zero-sum game, and so can the real real estate market since supply comes online so slowly. "Buy-to-let" is on the outright evil axis, while renting out space in your own home is the opposite of that.
Ideally our tax system would incentivize the latter and not the former, but in reality in the USA we have things like Section 8 subsidizing the former.
posted by Heywood Mogroot III at 4:35 PM on October 5, 2023
Monopoly is a zero-sum game, and so can the real real estate market since supply comes online so slowly. "Buy-to-let" is on the outright evil axis, while renting out space in your own home is the opposite of that.
I would like to point out that housing as a good is not a monopoly. There are thousands of landlords, so there's no monopolistic hoarding of housing. Landlords are still in competition with each other, but because housing demand grew a lot faster than housing supply, prices rose. Housing is still a free market good, just crazy expensive, because there's always someone willing to pay a higher price in a constrained housing market.
If the housing price is to be truly fixed, then one has to be serious about looking into the causes that make up housing demand and housing supply.
On the housing supply side: Ban restrictive zoning. The era of single family homes needs to go away. They're not built fast enough to make up for demand, and developers can't build necessary condo apartments or rental apartments on parcels that have single family homes. When I looked at Edmonton home price trends in the last few years, they barely budged. Calgary has risen much faster. Edmonton banned restrictive zoning a few years ago. Calgary banned restrictive zoning a few weeks ago, so I think Calgary's home prices will slowly return to affordable levels.
On the housing demand side: Mefites don't like hearing it, but population affects the demand side. Canadian domestic birth rates have been plummeting, in order for total population growth to remain positive, we've been using increasing intakes of immigration to keep total population growth persistently positive. Immigration doesn't need to go to zero for total population to begin declining, but I think first world governments have been using immigration to stop an economic restructuring that needs to happen. Japan has had affordable housing outside of Tokyo. My wife heard my BIL say that Seoul's rents went down this year, likely because of their demographic collapse. I think cities in North America may still have increasing rents and home prices for a while as they've been acting as sponges for collapsing rural communities.
posted by DetriusXii at 7:14 AM on October 7, 2023
I would like to point out that housing as a good is not a monopoly. There are thousands of landlords, so there's no monopolistic hoarding of housing. Landlords are still in competition with each other, but because housing demand grew a lot faster than housing supply, prices rose. Housing is still a free market good, just crazy expensive, because there's always someone willing to pay a higher price in a constrained housing market.
If the housing price is to be truly fixed, then one has to be serious about looking into the causes that make up housing demand and housing supply.
On the housing supply side: Ban restrictive zoning. The era of single family homes needs to go away. They're not built fast enough to make up for demand, and developers can't build necessary condo apartments or rental apartments on parcels that have single family homes. When I looked at Edmonton home price trends in the last few years, they barely budged. Calgary has risen much faster. Edmonton banned restrictive zoning a few years ago. Calgary banned restrictive zoning a few weeks ago, so I think Calgary's home prices will slowly return to affordable levels.
On the housing demand side: Mefites don't like hearing it, but population affects the demand side. Canadian domestic birth rates have been plummeting, in order for total population growth to remain positive, we've been using increasing intakes of immigration to keep total population growth persistently positive. Immigration doesn't need to go to zero for total population to begin declining, but I think first world governments have been using immigration to stop an economic restructuring that needs to happen. Japan has had affordable housing outside of Tokyo. My wife heard my BIL say that Seoul's rents went down this year, likely because of their demographic collapse. I think cities in North America may still have increasing rents and home prices for a while as they've been acting as sponges for collapsing rural communities.
posted by DetriusXii at 7:14 AM on October 7, 2023
In Canada we greatly reduced the amount of social housing being built (from like 25% to less than 3% depending on market since the early 70s). Similiar patterns exist in the US, Australia, Britain, etc. Social housing that was originally built to, drum roll, address affordability. And quell surprise the price of housing has sky rocketed since as the percentage of nonmarket housing shrank and as the free market turned the screws to extract everything thing they could. It will take decades to restore affordability and we do that by taxing rich people and building homes. Anything else like letting a demographic bomb explode in the country will just be window dressing around the issue.
posted by Mitheral at 8:18 AM on October 7, 2023 [3 favorites]
posted by Mitheral at 8:18 AM on October 7, 2023 [3 favorites]
The demographic bomb will explode at some point anyways. It's coming, governments are just playing hot potato to not deal with it. And yes, we should have more socialized development, but we can walk and chew bubblegum at the same time.
I don't believe the demographic bomb is irrelevant for housing. It's still a method that the federal government can use to put a brake to home prices.
posted by DetriusXii at 8:36 AM on October 7, 2023
I don't believe the demographic bomb is irrelevant for housing. It's still a method that the federal government can use to put a brake to home prices.
posted by DetriusXii at 8:36 AM on October 7, 2023
In Canada we greatly reduced the amount of social housing being built (from like 25% to less than 3% depending on market since the early 70s).
The free-marketers would say that the issue was not that non-market construction was replaced with market construction, but that non-market construction was replaced with... nothing. I don't have the numbers for housing-construction-per-capita handy, but I think they dropped precipitously over those years.
But the flip side is that the free marketers would still agree that a large-scale program of social housing construction will also create affordability. The key, though, is "large scale". Past political efforts seem laser-focused on the proportion of social housing being built, even at the expense of quantity. There doesn't seem to be much appetite for social housing construction nowadays, and the relatively few efforts are high-cost and low-volume, with not much pressure to fix that. Instead, the political efforts are focused on cutting down the volume of market housing -- an own goal at best and cynical sabotage at worst.
posted by alexei at 11:23 AM on October 7, 2023 [1 favorite]
The free-marketers would say that the issue was not that non-market construction was replaced with market construction, but that non-market construction was replaced with... nothing. I don't have the numbers for housing-construction-per-capita handy, but I think they dropped precipitously over those years.
But the flip side is that the free marketers would still agree that a large-scale program of social housing construction will also create affordability. The key, though, is "large scale". Past political efforts seem laser-focused on the proportion of social housing being built, even at the expense of quantity. There doesn't seem to be much appetite for social housing construction nowadays, and the relatively few efforts are high-cost and low-volume, with not much pressure to fix that. Instead, the political efforts are focused on cutting down the volume of market housing -- an own goal at best and cynical sabotage at worst.
posted by alexei at 11:23 AM on October 7, 2023 [1 favorite]
>There are thousands of landlords, so there's no monopolistic hoarding of housing
every housing unit enjoys a local monopoly of its location (location, location).
Funny thing about upzoning SFH is that it will make SFH homes much more expensive as land prices normalize to its 'highest and best use' valuation.
posted by Heywood Mogroot III at 11:26 AM on October 7, 2023 [1 favorite]
every housing unit enjoys a local monopoly of its location (location, location).
Funny thing about upzoning SFH is that it will make SFH homes much more expensive as land prices normalize to its 'highest and best use' valuation.
posted by Heywood Mogroot III at 11:26 AM on October 7, 2023 [1 favorite]
>Japan has had affordable housing outside of Tokyo.
In Tokyo you can build just about anything (3 or fewer stories) just about anywhere. I paid ¥90,000 ($700) rent for a decent (but cheap) studio in Kichijoji in 1993, and the rental listing was ¥85,000 when it was last on the market last year. I also saw listed last month the quite nice studio I rented in Tokyo's best neighborhood (Hiroo) for ¥110,000/mo (~$1000) in the late 90s, and the rent was down to ¥90,000 (~$600) ...
SFHs in Tokyo are still very expensive, but all the liberal zoning does keep a good lid on rents apparently.
(it's somewhat hazardous comparing dollar values from the 1990s to now since Japan's internal valuations in the 1990s were still really stuck at the historical pre-Plaza ¥250/USD . . . in some ways today's ¥150 FX rate is a return to a late 80s happy medium I guess)
posted by Heywood Mogroot III at 11:32 AM on October 7, 2023 [2 favorites]
In Tokyo you can build just about anything (3 or fewer stories) just about anywhere. I paid ¥90,000 ($700) rent for a decent (but cheap) studio in Kichijoji in 1993, and the rental listing was ¥85,000 when it was last on the market last year. I also saw listed last month the quite nice studio I rented in Tokyo's best neighborhood (Hiroo) for ¥110,000/mo (~$1000) in the late 90s, and the rent was down to ¥90,000 (~$600) ...
SFHs in Tokyo are still very expensive, but all the liberal zoning does keep a good lid on rents apparently.
(it's somewhat hazardous comparing dollar values from the 1990s to now since Japan's internal valuations in the 1990s were still really stuck at the historical pre-Plaza ¥250/USD . . . in some ways today's ¥150 FX rate is a return to a late 80s happy medium I guess)
posted by Heywood Mogroot III at 11:32 AM on October 7, 2023 [2 favorites]
Funny thing about upzoning SFH is that it will make SFH homes much more expensive as land prices normalize to its 'highest and best use' valuation.
For some SFHs, that's true. Location, location. But for a lot of them, in new-build suburbs where houses are on small lots but you still have to drive on a highway to get a gallon of milk?
Once people have options, I don't see them getting more expensive. Even if you're allowed to build a triplex on the lot.
posted by alexei at 4:10 PM on October 9, 2023
For some SFHs, that's true. Location, location. But for a lot of them, in new-build suburbs where houses are on small lots but you still have to drive on a highway to get a gallon of milk?
Once people have options, I don't see them getting more expensive. Even if you're allowed to build a triplex on the lot.
posted by alexei at 4:10 PM on October 9, 2023
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