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Landlords are price takers, not price makers. The market for apartments is highly competitive.

• Sohcahtoa82 5y ago
  If that was true, apartment pricing would be flat or even trending down, as landlords would compete on price. But they don't. Instead, landlords fight against the construction against additional housing so they can limit supply and increase prices. I had a 900 sq foot, 2br, 1 bath apartment in the suburbs in 2012 that was $800/month. Each annual lease renewal was a higher price. When I moved out in 2015, the price was $950 at the time. If I had renewed, it would have been $1,100/month. That apartment now is $1,500/month. In less than 10 years, that apartment has doubled in cost. Rising prices do not indicate a competitive market.
  • whimsicalism 5y ago
    Rising prices have nothing to do with whether it is a competitive market. I agree with most of the rest of your comment, but none of that means that the landlords are price setters. Nor does it show that discussing supply is a "deflection."
    • vmception 5y ago
      Supply and demand is a factor. You can talk about it. It is not a unique enough factor to this time period. I feel like you wanted someone to acknowledge that. Perhaps property sales and rentals should require attestations about who offered what price and we can use that data to consider deterrents or levies on those who moved the price up from the prior owner or tenant. Sure there are some prospective occupants that will say a higher price just to skip the queue, I dont think they are really the majority of people even when well funded transplants descend upon a town. I think the majority just take whatever the landlord offers.
      • xapata 5y ago
        > I think the majority just take whatever the landlord offers. Taking the price offered for a particular property is not the same as ignoring prices. Apartment shoppers search for the combination of quality and price that best satisfies their preferences. I have a hard time imagining an alternative. Would that be going to an apartment search engine and simply picking the first result, regardless of quality and price? When I go to the grocery store, I don't negotiate with the cashier. That doesn't mean grocery stores aren't competing with each other.
        • vmception 5y ago
          Yes and the shoppers find one, the trend is that the unit they find and pick - no matter what the shopper lands on - was rented higher than the last time, because the landlord set it higher than the last time. This didn't have to occur, the landlord could have done the prior price, the lower price, even in the face of demand and people willing to close quickly at the new higher price.
          • xapata 5y ago
            Why would the landlord choose to rent at below market rates? I think we've drifted from the question of whether the rental apartment market is competitive. If a landlord chooses to consistently rent below market rates, for whatever foolish reason, then they'll probably wind up selling the building to someone who knows what the market rate is. It might take a while, but it'll happen eventually.
            • vmception 5y ago
              The point is to place the gentrification blame on the landlords instead of the people who happen to be able to afford the stated price
              • xapata 5y ago
                I wouldn't blame anyone for gentrification. It's just a thing that happens.
  • xapata 5y ago
    > If that was true, apartment pricing would be flat or even trending down, as landlords would compete on price. It is possible to have rising prices in a competitive market. For example, the automobile market is competitive and experiences rising prices. When I was shopping for an apartment not long ago, I saw several signs advertising discounts. This is evidence that landlords compete on price. However, lack of advertised discounts would not be evidence of a monopoly.