4 ms·
That risk has always been 90 days maximum loss of rent, by law in some places, so you could understand landlords calculating that happening maybe once every 5 y
by spfzero 5y ago
That risk has always been 90 days maximum loss of rent, by law in some places, so you could understand landlords calculating that happening maybe once every 5 years or so. And they could be careful in selecting tenants, so they had a way to mitigate the risk.
In this case, however, the law was changed retroactively to an open-ended, tenant-gets-to-live-in-your-house-for-free. Hard to see how landlords should have factored the likelihood of that in.
- edmundsauto 5y agoThere is risk that the property would be damaged, risk that massive maintenance bills could arise (cracks in the foundation), risk that it would be unrentable, that rental rates would drop, or that property values would decrease. If small investors were basing their calculations that the only risk is up to 90 days without rent... then yeah, they miscalculated the risks.
- mywittyname 5y agoThis kind of thing destroys small-time landlords all the time. If you only have one rental property, you're one bad tenant away from incurring a loss that will take years to recoup. Succeeding in the real estate game is all about numbers. Lots of properties in a variety of locales spread the risk of one individual tenant bankrupting you.