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Out of curiosity, have you ever owned a building? I might suggest that your opinions might change once you have. Owning rental property isn’t a tidy math proble
by briandear 7y ago
Out of curiosity, have you ever owned a building? I might suggest that your opinions might change once you have. Owning rental property isn’t a tidy math problem.
Newer buildings have more predictable costs, definitely not older buildings. It’s pretty much the opposite of what you said in the real world. Newer buildings can lease to higher quality tenants at higher rates with lower eviction/non-payment/damage risk. Older buildings can run the gamut. You can have an older building filled with stable senior citizens that runs perfectly for decades or you can have an older building filled with tenants who constantly break things, are late on rent, run meth labs, or simply trash a place and vacate in the middle of the night. You might have to evict someone and the process could take a year. Air conditioners fail randomly and expensively. Roof leaks develop and tenants might not even report it for months (yes, that sort of thing happens all the time. As a building gets older, the risks increase, but the rent you can charge decreases compared to a new building.
My suggestion is to actually ask people who have owned building exactly why they oppose rent control so fiercely and the answers aren’t going to be about greed but about increased financial risk.
- jdavis703 7y agoIf we can agree that profit is essentially what we call "greed," any financial risk means deceased profits, in other words less opportunity for greed. I'm not a communist so I'm not against profit, but in Marxist theory this kind of profit is seen as the problem with capitalism.
- roenxi 7y agoYou might want to re-read your Marx; one of his more famous and less controversial observations was that the rate of profit tends to decrease over time in a healthy market. High rates of profit wasn't the problem, it was the negative effects that were theorised to occur when the rate of profits, inevitably, fell too low.
- throw0101a 7y ago> Owning rental property isn’t a tidy math problem. I'm not talking about owning, but about encouragement of building. If income is limited to CPI, regardless market characteristics, what incentive is there to take a risk and build?