4 ms·

I mean this depends on the context. In our current market that's how a lot of people operate but it isn't a requirement. See any kind of pro bono work, To be ho

by Jochim 4y ago

I mean this depends on the context. In our current market that's how a lot of people operate but it isn't a requirement. See any kind of pro bono work, To be honest it feels like a really convenient excuse that people use when they're aware, on some level, that they should feel bad about their actions. From a purely practical point of view, as a landlord your tenants can cause a lot of financial damage. If you force out a good tenant by raising rents then you're gambling that the next one isn't going to be a nightmare.

onionisafruit 4y ago
You need to be careful when doing this. The IRS requires you to file a gift tax form if you charge below market rents.
osigurdson 4y ago
Let’s say you have a leasable asset, your choices are to maximize its net present value or to price the lease under the market in order to benefit someone else. The best thing you can do for someone else is to give them all of your assets and attempt to live in a manner that does not compete for resources with others (live in some kind of zero energy homeostasis until reaching an old age for example). Obviously, these represent two extremes of selfishness and selflessness. So, what is a rule of thumb for an asset owner to not be considered greedy? Price 10% below market for example or allow 3 missed payments per year? Greed is an easy label to assign until until you have to get concrete about it.
- Jochim 4y ago
  Like many things in society it's not entirely objective. It depends on the situations of the parties involved. Take two hypothetical tenants. One is a young software developer earning $15k/mo, the other a retired widow on a fixed pension of $3k/mo. The social reaction to either party's rent being raised from $1k/mo to $2.5k/mo is going to be very different. > your choices are to maximize its net present value or to price the lease under the market in order to benefit someone else This leaves out the fact that in the majority of cases the lessor is benefiting either way. It's purely the extent to which they benefit that changes. > Greed is an easy label to assign until until you have to get concrete about it. All sorts of labels are difficult to assign objectively. What matters is personal opinion and societal consensus. Both of those are fluid and have changed throughout history.

by Jochim 4y ago

onionisafruit 4y ago

You need to be careful when doing this. The IRS requires you to file a gift tax form if you charge below market rents.

osigurdson 4y ago

Let’s say you have a leasable asset, your choices are to maximize its net present value or to price the lease under the market in order to benefit someone else. The best thing you can do for someone else is to give them all of your assets and attempt to live in a manner that does not compete for resources with others (live in some kind of zero energy homeostasis until reaching an old age for example). Obviously, these represent two extremes of selfishness and selflessness. So, what is a rule of thumb for an asset owner to not be considered greedy? Price 10% below market for example or allow 3 missed payments per year? Greed is an easy label to assign until until you have to get concrete about it.

Jochim 4y ago
Like many things in society it's not entirely objective. It depends on the situations of the parties involved. Take two hypothetical tenants. One is a young software developer earning $15k/mo, the other a retired widow on a fixed pension of $3k/mo. The social reaction to either party's rent being raised from $1k/mo to $2.5k/mo is going to be very different. > your choices are to maximize its net present value or to price the lease under the market in order to benefit someone else This leaves out the fact that in the majority of cases the lessor is benefiting either way. It's purely the extent to which they benefit that changes. > Greed is an easy label to assign until until you have to get concrete about it. All sorts of labels are difficult to assign objectively. What matters is personal opinion and societal consensus. Both of those are fluid and have changed throughout history.