(09-17-2024, 01:31 PM)Jag149 Wrote:

(09-17-2024, 01:21 PM)mikesez Wrote: I have friends who are landlords.
Things can happen. Insurance renewals come in way higher than projected. Repair costs can come in way higher than projected.  Especially unscheduled emergency repairs.  Vacancy rates can go up. If they all happen at the same time that's basically a guaranteed short term loss.

Basic question: Suppose you had a tenant move out and also had costs go up at the same time.  Suppose the going rate for new tenants is not enough for you to make a profit.  You will have a slight loss.  Do you (a) let the unit stay vacant and take a big loss every month it stays vacant, or (b) take what you can get and hope the market conditions are better at renewal time.

Many landlords would choose (a).  But they haven't had to lately because the "going rates" have been very high.

Yea, that is part of running a business. Risk and reward.  Many businesses lose money and end up on the trash pile. There are however many that do not.  You asked why rents were as high as they were and I gave you a solid answer. If you want to now discuss why some landlords don't do well and some do that is a totally different subject. I can't believe anyone sets out to lose money. You just have to get by that first sentence as it is not the topic. I can assume you have no link?

Costs did increase for landlords.  No doubt.  But as I've shown, the landlords can't always pass those increased costs on to their tenants.  They only can when there is a scarcity of housing.  When vacancy rates are low.  

Rents don't go up when there is a surplus of occupiable units.  Even if other costs go up, rent usually stays low when there is a surplus of units.  We have a shortage.  It would be nice if we had a surplus.  Right?

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