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It still appreciates if it's rented out, so that doesn't change anything. When it's rented, you get appreciation plus income, and when it's not rented, you get
by awillen 5y ago
It still appreciates if it's rented out, so that doesn't change anything. When it's rented, you get appreciation plus income, and when it's not rented, you get appreciation only.
- kflzufkrbzi 5y agoIf appreciation is 99% and rent is 1% does it change anything?
- djrogers 5y agoThat’s a bit of a straw man, as that degree of market imbalance would completely end renting.
- nend 5y agoIsn't that what this thread is about though? The complete end of renting in this downtown strip. The buildings are sitting empty and not renting.
- alisonkisk 5y agoWhy are they appreciating so much if there's no rent to collect? Are storefronts NFTs?
- pstuart 5y agoLots of money out there looking for home, so to speak.
- IG_Semmelweiss 5y agoThere are hordes of SBA dollars floating around, looking for a home. Havent you seen the fed's balance sheet?
- ethanbond 5y agoBecause land is finite. Land within an established city even more so. Not only is there rent to collect should they want to, but it’s almost a guarantee that there will be rent to collect indefinitely into the future.
- 55555 5y agoThe risk-adjusted return differential is much less than appears at first glance.
- awillen 5y agoThat's not a real situation that will arise, so it doesn't matter.
- anigbrowl 5y agoAppreciation only + tax deductions can be a great combo in a hot market. why deal with the hassle of tenants when you can have rapid appreciation, and the more property is off the market, the higher the prices become?
- awillen 5y agoYou can employ a professional property manager to deal with the hassle of tenants. Your one property (or a few properties) being empty isn't moving the needle enough in terms of the price of real estate to make up the difference from lack of rent.
- anigbrowl 5y agoBut many landlords (especially corporate ones) own a lot of property, and furthermore landlords can and do cooperate. I think you're assuming perfect competition, where all pricing is transparent and all market participants interact with each other exclusively through price signals. In reality landlords compete but also cooperate, and their associations are more integrated/coordinated than those of tenants. There are far fewer landlords than tenants, and a non-rental motivated by collective/cooperative solidarity means a lack of profit maximization for the landlord but often lack of a place to live for the tenant, so the incentives as well as the market structure are wildly asymmetrical.