4 ms·

>they'd love to make nicer places and charge higher rents with higher margins, but they can't, because that's all these people can pay Nicer places require lar

>they'd love to make nicer places and charge higher rents with higher margins, but they can't, because that's all these people can pay Nicer places require larger capital outlays. The landlords chose their market, not the other way around.

OJFord 11y ago
> The landlords chose their market, not the other way > around. That goes against.. almost all economic thought. You don't choose to make umbrellas for the umbrella market, and just keep churning out umbrellas, perpetually disappointed by the fine weather. This market is profitable, but if it were wealthier, it would be more profitable. There's no incentive for a business-owner in such a place to somehow keep the locals in a state of poverty.
- unclebucknasty 11y ago
  >You don't choose to make umbrellas for the umbrella market, and just keep churning out umbrellas, perpetually disappointed by the fine weather. You do if people keep buying them, irrespective of the weather. You've misread my comment. I'm not saying that the landlords create the market; simply that the landlords chose a market that requires less capital outlay, and also with full knowledge that the market is not typically upwardly mobile. In other words, it's fairly rare that landlords buy mobile parks with the intent of later upgrading their customers to upscale condominiums.
  - brightball 11y ago
    That is entirely the point though. If a landlord is about to chose a market that requires less capital outlay it's because there is an unfilled need in that market. Without the lower cost housing the tenants will only have fewer options, potentially more expensive ones at that. If all of the needs are filled and somebody else decides to target the market then they have to find a way to disrupt it, in this case that probably means figuring out how to reduce costs and charge less.
    - StanislavPetrov 11y ago
      Except your fantasy of a free real estate market doesn't exist. FED policies, by their own admission, serve to artificially drive up real estate prices, which punish the poorest, who don't own property and are forced to rent. This is a direct subsidy to property owners with the size of the subsidy equal to the amount of property owned. These FED efforts (MBS purchasing, ZIRP, suspension of MTM, QE1-3) to prop up housing also inflate equity and bond markets, further subsidizing the wealthy (while those in poverty who own no stocks or bonds fall further behind). So yes, people are profiting off of poverty.
      - tamana 11y ago
        Fantasy or not, free to not, landlords don't control the Fed.
        collyw 11y ago
        Not sure about the Fed, but plenty of UK politicians own buy to let property, so hardly a free market when they have such vested interests in keeping prices high.
    - unclebucknasty 11y ago
      We've gotten off track. I'm not arguing whether the market exists or how basic economics in a perfect market work. If you look back at my original comment it's WRT the assertion that these landlords would love to upgrade their properties and charge higher rents. I was simply saying that's largely untrue. These landlords are aware of the market dynamics/demographic when choosing to invest and have little-to-no desire to "upgrade for higher margins".
      - darawk 11y ago
        They would have that desire if all their tenants were suddenly wealthy enough to pay those rents, was my point. Which speaks to the broader point that these landlords are not working to keep these people in poverty.
- massysett 11y ago
  If this market were wealthier it wouldn't exist. The tenants would be getting mortgages or renting nicer apartments, not living in trailer parks. And, because governments like to have higher income residents, they would have more choices of where to live, as trailer parks are exiled to the fringe. Some of these market dynamics exist precisely because these people are poor and the landlords have no incentive for their customers to be better off, just like Walmart would not be better off if its customers got more money and started going to Macys.
  - OJFord 11y ago
    > If this market were wealthier it wouldn't exist. The > tenants would be getting mortgages or renting nicer > apartments, not living in trailer parks. Which is what would make them more profitable.
    - pyrale 11y ago
      No, because the cost of building, maintaining and keep in a state of compliance a housing lot is superior to the increase in rent. Sleep dealing is a lucrative job. There are many factors explaining this : reduced access to law for the poorest, lack of alternatives, but also social perception of the tenants and of their worth, or the cognitive bias displayed by many about homo economicus.

OJFord 11y ago

> The landlords chose their market, not the other way > around. That goes against.. almost all economic thought. You don't choose to make umbrellas for the umbrella market, and just keep churning out umbrellas, perpetually disappointed by the fine weather. This market is profitable, but if it were wealthier, it would be more profitable. There's no incentive for a business-owner in such a place to somehow keep the locals in a state of poverty.

unclebucknasty 11y ago
>You don't choose to make umbrellas for the umbrella market, and just keep churning out umbrellas, perpetually disappointed by the fine weather. You do if people keep buying them, irrespective of the weather. You've misread my comment. I'm not saying that the landlords create the market; simply that the landlords chose a market that requires less capital outlay, and also with full knowledge that the market is not typically upwardly mobile. In other words, it's fairly rare that landlords buy mobile parks with the intent of later upgrading their customers to upscale condominiums.
- brightball 11y ago
  That is entirely the point though. If a landlord is about to chose a market that requires less capital outlay it's because there is an unfilled need in that market. Without the lower cost housing the tenants will only have fewer options, potentially more expensive ones at that. If all of the needs are filled and somebody else decides to target the market then they have to find a way to disrupt it, in this case that probably means figuring out how to reduce costs and charge less.
  - StanislavPetrov 11y ago
    Except your fantasy of a free real estate market doesn't exist. FED policies, by their own admission, serve to artificially drive up real estate prices, which punish the poorest, who don't own property and are forced to rent. This is a direct subsidy to property owners with the size of the subsidy equal to the amount of property owned. These FED efforts (MBS purchasing, ZIRP, suspension of MTM, QE1-3) to prop up housing also inflate equity and bond markets, further subsidizing the wealthy (while those in poverty who own no stocks or bonds fall further behind). So yes, people are profiting off of poverty.
    - tamana 11y ago
      Fantasy or not, free to not, landlords don't control the Fed.
      - collyw 11y ago
        Not sure about the Fed, but plenty of UK politicians own buy to let property, so hardly a free market when they have such vested interests in keeping prices high.
  - unclebucknasty 11y ago
    We've gotten off track. I'm not arguing whether the market exists or how basic economics in a perfect market work. If you look back at my original comment it's WRT the assertion that these landlords would love to upgrade their properties and charge higher rents. I was simply saying that's largely untrue. These landlords are aware of the market dynamics/demographic when choosing to invest and have little-to-no desire to "upgrade for higher margins".
    - darawk 11y ago
      They would have that desire if all their tenants were suddenly wealthy enough to pay those rents, was my point. Which speaks to the broader point that these landlords are not working to keep these people in poverty.
massysett 11y ago
If this market were wealthier it wouldn't exist. The tenants would be getting mortgages or renting nicer apartments, not living in trailer parks. And, because governments like to have higher income residents, they would have more choices of where to live, as trailer parks are exiled to the fringe. Some of these market dynamics exist precisely because these people are poor and the landlords have no incentive for their customers to be better off, just like Walmart would not be better off if its customers got more money and started going to Macys.
- OJFord 11y ago
  > If this market were wealthier it wouldn't exist. The > tenants would be getting mortgages or renting nicer > apartments, not living in trailer parks. Which is what would make them more profitable.
  - pyrale 11y ago
    No, because the cost of building, maintaining and keep in a state of compliance a housing lot is superior to the increase in rent. Sleep dealing is a lucrative job. There are many factors explaining this : reduced access to law for the poorest, lack of alternatives, but also social perception of the tenants and of their worth, or the cognitive bias displayed by many about homo economicus.