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Prices are set by the Property Management Software SaaS that all landlords use. So it is a Cartel. That is why prices rise even in places where population drops

Prices are set by the Property Management Software SaaS that all landlords use. So it is a Cartel. That is why prices rise even in places where population drops and vacancies rise. This can't be a surprise, vast swathes of the economy have fallen into virtual monopoly over that last few decades. By the way, I think we can extrapolate candidate Bloomberg's (non)position on the housing issue here.

toasterlovin 7y ago
C'mon. Landlords are not a cartel. If a landlord can't fill a unit because renters won't pay what they ask, then they have every reason to lower the price until the unit is filled. Because some rent is better than no rent.
- TomMckenny 7y ago
  This theory is simply not correct, the market is broken. Even flint Michigan has lost 1/5 of it's population since 2000 and rent has still risen. Just show me some towns where the market works. The use of that software has exactly the same outcome as a cartel but, understandably, few people want to acknowledge that even to themselves.
  - deleted 7y ago
    [deleted]
- bmn__ 7y ago
  > they have every reason to lower the price until the unit is filled That's the behaviour of the completely rational homo economicus which does not exist in real life. A certain amount of landlords of walk-in business space in Manhattan have a fixed price in their mind and will not go below, no matter what.
  - smegma2 7y ago
    Wouldn't it be likely for another more rational landlord to exploit that opportunity then? Or are there some barriers?
    - TomMckenny 7y ago
      The barriers include psychological refusal and debt on the building. But the main barrier, at least for residential property, is researching competing prices. This is solved by using a service. The same service all land lords use. This is why there are no examples of any towns where rent is less than it was decade ago regardless of population decline. It is why there are rising numbers of working homeless in towns with rising vacancies. It is the chief mechanism driving ever increasing rental profits which is probably why merely mentioning the existence of the service, its ubiquitous use and success draws such silent ire. Silent because of course anyone can just google for the service. It also does not match the standard narrative which no doubt annoys people in inarticulable ways. Likelihood is a real measurable quantity with a real number attached. You can obtain it by counting the defection rate: the number who lower their rent. This number is observably zero.
      - deleted 7y ago
        [deleted]
      - smegma2 7y ago
        Ok, so you seem to think that landlords cooperate on pricing. My reply was to the person above who seemed to think that prices may deviate from the market rate without any cooperation. Regardless, do you have a source on the claim that housing prices never go down, even with a declining population? I'd be curious to see if they adjusted for inflation or not.
        TomMckenny 7y ago
        I was listing barriers namely debt and market research. The market research barrier is solved in such a way that it produces a de-facto cartel. But indeed, "Never" is to strong a term. "Typically in the US" would be more correct. in 2000, the average US rent was $600 and the vacancy rate was 7.8% in 2018, the average US rent was $1400 and the vacancy rate was 7.5% I can not list every city in the country that has lost population but I can start with two: As I mention elsewhere, Flint Michigan has lost some 20% of it's population since 2000 and rent has still risen. And searching California for cities with declining population (there are not many) the first I found, Citrus Heights CA, has had a net drop in population in the last 20yers yet rent has increased four fold. At any rate, the down votes make it clear this information is not welcome here.

toasterlovin 7y ago

C'mon. Landlords are not a cartel. If a landlord can't fill a unit because renters won't pay what they ask, then they have every reason to lower the price until the unit is filled. Because some rent is better than no rent.

TomMckenny 7y ago
This theory is simply not correct, the market is broken. Even flint Michigan has lost 1/5 of it's population since 2000 and rent has still risen. Just show me some towns where the market works. The use of that software has exactly the same outcome as a cartel but, understandably, few people want to acknowledge that even to themselves.
- deleted 7y ago
  [deleted]
bmn__ 7y ago
> they have every reason to lower the price until the unit is filled That's the behaviour of the completely rational homo economicus which does not exist in real life. A certain amount of landlords of walk-in business space in Manhattan have a fixed price in their mind and will not go below, no matter what.
- smegma2 7y ago
  Wouldn't it be likely for another more rational landlord to exploit that opportunity then? Or are there some barriers?
  - TomMckenny 7y ago
    The barriers include psychological refusal and debt on the building. But the main barrier, at least for residential property, is researching competing prices. This is solved by using a service. The same service all land lords use. This is why there are no examples of any towns where rent is less than it was decade ago regardless of population decline. It is why there are rising numbers of working homeless in towns with rising vacancies. It is the chief mechanism driving ever increasing rental profits which is probably why merely mentioning the existence of the service, its ubiquitous use and success draws such silent ire. Silent because of course anyone can just google for the service. It also does not match the standard narrative which no doubt annoys people in inarticulable ways. Likelihood is a real measurable quantity with a real number attached. You can obtain it by counting the defection rate: the number who lower their rent. This number is observably zero.
    - deleted 7y ago
      [deleted]
    - smegma2 7y ago
      Ok, so you seem to think that landlords cooperate on pricing. My reply was to the person above who seemed to think that prices may deviate from the market rate without any cooperation. Regardless, do you have a source on the claim that housing prices never go down, even with a declining population? I'd be curious to see if they adjusted for inflation or not.
      - TomMckenny 7y ago
        I was listing barriers namely debt and market research. The market research barrier is solved in such a way that it produces a de-facto cartel. But indeed, "Never" is to strong a term. "Typically in the US" would be more correct. in 2000, the average US rent was $600 and the vacancy rate was 7.8% in 2018, the average US rent was $1400 and the vacancy rate was 7.5% I can not list every city in the country that has lost population but I can start with two: As I mention elsewhere, Flint Michigan has lost some 20% of it's population since 2000 and rent has still risen. And searching California for cities with declining population (there are not many) the first I found, Citrus Heights CA, has had a net drop in population in the last 20yers yet rent has increased four fold. At any rate, the down votes make it clear this information is not welcome here.