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Something I've heard a landlord argue was that if he lowered his rent that would mean his property value would go down which would mean his loans/mortgages woul
by tinco 8y ago
Something I've heard a landlord argue was that if he lowered his rent that would mean his property value would go down which would mean his loans/mortgages would not be covered. He would rather take a couple months of losses than devalueing his property.
I have no idea if the math works out for that, and he was negotiating, but he didn't budge a cent and we took our business elsewhere so it did seem like his hands were tied the same as your example.
- anitil 8y agoI have heard similar arguments from developers in Sydney. They will give you a car, or guaranteed rental income for x months, rather than dropping the price of the property.
- hellisothers 8y agoAs the other reply mentioned, the value of commercial rental property is a multiplier of the rent you can charge. If you lower your rents then not only are you lowering your cash flow but you’re lowering the value of the property overall which can impact resale value and the ability to take out loans.