4 ms·

Lots of examples here, but the one I can't stop thinking about is rent. The longer you stay, the more you pay. To get a decent rate, you have to move. But there

Lots of examples here, but the one I can't stop thinking about is rent. The longer you stay, the more you pay. To get a decent rate, you have to move. But there's a lot of friction there, and landlords know it.

gutnor 9y ago
That's the other way around most of the time where I lived (Continental Europe and London) Only in London, people I know have had both experiences. Letting agencies are really the one pushing. For the landlord, a paying tenant is a good tenant, there is friction in changing tenant: you can lose 1 month rent or need to do some refurbishments. Even missing a few weeks can mean losing any benefit of keeping the same tenant at the same rate for 1 or more years. Letting agencies offer a service to both the landlord and the tenant. As a tenant you get a certain level of service, like repairs or maintenance. As a landlord, the agency offer vetted tenant, management and various guarantees. They are the one pushing for rate increase as that's what they take their share from. The real problem with renting is the underlying skyrocketing price of housing. You can't escape it.
HillaryBriss 9y ago
OTOH, also consider local rent control laws, which often only allow a rent increase below the CPI. the longer you stay the more you save.
- 15155 9y ago
  Living expenses artificially subsidized by the non-rent-controlled property around you, what's not to like?
  - vkou 9y ago
    As opposed to living expenses artificially inflated, despite the landlord not putting one iota of work into their property? (Because the neighbourhood gentrified, a new school was built with taxpayer money, Amazon opened an office..?) Property markets are perverse in many different ways, most of which don't benefit renters.
    - sokoloff 9y ago
      If exogenous factors make an area more desirable to live in, increasing demand and the market-clearing rent, that’s not “artificially inflated” IMO. The landlord is (or at least should be) exposed to the vagaries of supply and demand in the downward direction as well as the upward.
UncleEntity 9y ago
I have the exact opposite experience, my rent is $50 more than it was when I moved here in 2011 and a lot less than I'd have to pay if I decided to move. Pretty sure I'm paying less for my 2 bedroom than they're charging for a 1 bedroom now. Since I've been here the neighborhood has improved to the point that people actually want to live here and not, like when I originally moved in, a semi-OK neighborhood with cheapish rent where you probably won't have any hassles walking to the corner store at 3am. Then again, I was talking to my landlord a while back and the city was complaining he wasn't charging enough (ie. wasn't paying enough taxes) but he would rather have good long-term tenants than charge "market rates" and deal with all the problems that come with that.
kolpa 9y ago
Landlords also no that empty units are worthless and good tenants are hard to find, so usually they offer good rates to long-time tenants, unless they are sold out of inventory in a tight market.
- kylec 9y ago
  This depends on whether a human or a computer is setting the prices. I once lived in an apartment complex that had management software setting the prices, and one time when I got my lease renewal offer I checked the apartment's website and found another apartment that was basically the same for $150/month less. I asked if I could get that rate on my current apartment, but was told by the manager that there was nothing they could do. So I moved from one apartment to another in the same building. Both sides lost - I had to spend the time and effort to move and they now needed to spend time and money to prep another apartment for rent - but I suppose the pricing algorithm takes this into account and figures that in aggregate the apartment complex still comes out ahead by continuing to squeeze people that don't want to move.

gutnor 9y ago

That's the other way around most of the time where I lived (Continental Europe and London) Only in London, people I know have had both experiences. Letting agencies are really the one pushing. For the landlord, a paying tenant is a good tenant, there is friction in changing tenant: you can lose 1 month rent or need to do some refurbishments. Even missing a few weeks can mean losing any benefit of keeping the same tenant at the same rate for 1 or more years. Letting agencies offer a service to both the landlord and the tenant. As a tenant you get a certain level of service, like repairs or maintenance. As a landlord, the agency offer vetted tenant, management and various guarantees. They are the one pushing for rate increase as that's what they take their share from. The real problem with renting is the underlying skyrocketing price of housing. You can't escape it.

HillaryBriss 9y ago

OTOH, also consider local rent control laws, which often only allow a rent increase below the CPI. the longer you stay the more you save.

15155 9y ago
Living expenses artificially subsidized by the non-rent-controlled property around you, what's not to like?
- vkou 9y ago
  As opposed to living expenses artificially inflated, despite the landlord not putting one iota of work into their property? (Because the neighbourhood gentrified, a new school was built with taxpayer money, Amazon opened an office..?) Property markets are perverse in many different ways, most of which don't benefit renters.
  - sokoloff 9y ago
    If exogenous factors make an area more desirable to live in, increasing demand and the market-clearing rent, that’s not “artificially inflated” IMO. The landlord is (or at least should be) exposed to the vagaries of supply and demand in the downward direction as well as the upward.

UncleEntity 9y ago

I have the exact opposite experience, my rent is $50 more than it was when I moved here in 2011 and a lot less than I'd have to pay if I decided to move. Pretty sure I'm paying less for my 2 bedroom than they're charging for a 1 bedroom now. Since I've been here the neighborhood has improved to the point that people actually want to live here and not, like when I originally moved in, a semi-OK neighborhood with cheapish rent where you probably won't have any hassles walking to the corner store at 3am. Then again, I was talking to my landlord a while back and the city was complaining he wasn't charging enough (ie. wasn't paying enough taxes) but he would rather have good long-term tenants than charge "market rates" and deal with all the problems that come with that.

kolpa 9y ago

Landlords also no that empty units are worthless and good tenants are hard to find, so usually they offer good rates to long-time tenants, unless they are sold out of inventory in a tight market.

kylec 9y ago
This depends on whether a human or a computer is setting the prices. I once lived in an apartment complex that had management software setting the prices, and one time when I got my lease renewal offer I checked the apartment's website and found another apartment that was basically the same for $150/month less. I asked if I could get that rate on my current apartment, but was told by the manager that there was nothing they could do. So I moved from one apartment to another in the same building. Both sides lost - I had to spend the time and effort to move and they now needed to spend time and money to prep another apartment for rent - but I suppose the pricing algorithm takes this into account and figures that in aggregate the apartment complex still comes out ahead by continuing to squeeze people that don't want to move.