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>I get the hate against institutional investors going in and buying up entire neighborhoods. But the sentiment that we should just abolish landlords is rather d

by dqv 4y ago

>I get the hate against institutional investors going in and buying up entire neighborhoods. But the sentiment that we should just abolish landlords is rather dumb IMO. There's a massive gap between someone being able to afford $1200 in rent and being able to afford a home with all of the added costs. As opposed to... being able to afford the rent with the same added costs? Take my area for example: rent in my neighborhood has increased to $2000/month. My mortgage remains at $1500/month (taxes, insurance, HOA included). What added costs amount to $500 extra/month? It's not water, sewage, trash, electricity, or gas! Those costs exist for renters just as much as owners. It's not basic maintenance... that has not cost me anywhere near $6000/year. So what are the added costs that landlords are "saving" renters from?

deleted 4y ago
[deleted]
xienze 4y ago
> So what are the added costs that landlords are "saving" renters from? Utilities will generally cost a bit more. But the real killers with home ownership tend to be large expenses that come due all at once. Roof needs to be replaced, AC unit needs to be replaced, major appliance replacement, foundation problems, any number of expensive things can and will come up.
- dqv 4y ago
  I already addressed this: all these costs are already factored into the monthly rent. In my case I had to replace the dishwasher. I wanted a quiet one, so it ran about $1200. I bought it on credit and got 0% financing. So my housing price increases by $100 for the next year. Now if I were renting? $2000/month. The landlord gets the absolute cheapest dishwasher they can find. It maybe runs them $300. So the landlord would be saving me ... $-475. Paying $5700 extra a year to avoid a $300 added cost makes no sense. Paying $6000 a year in perpetuity for a one-time expense that lasts the next 20 years also makes no sense. The point is that the tenant is not being protected from any added costs, they are paying way above market value for them.
- jjav 4y ago
  > But the real killers with home ownership tend to be large expenses that come due all at once. All these expenses (plus a profit margin) are built into the rent, of course. Two ways the owner handles them: Either they have enough money saved that they can absorb the spikes in cost, or, they contract some maintenance plan they have to pay every month but smooths out the costs to avoid surprises.

by dqv 4y ago

deleted 4y ago

[deleted]

xienze 4y ago

> So what are the added costs that landlords are "saving" renters from? Utilities will generally cost a bit more. But the real killers with home ownership tend to be large expenses that come due all at once. Roof needs to be replaced, AC unit needs to be replaced, major appliance replacement, foundation problems, any number of expensive things can and will come up.

dqv 4y ago
I already addressed this: all these costs are already factored into the monthly rent. In my case I had to replace the dishwasher. I wanted a quiet one, so it ran about $1200. I bought it on credit and got 0% financing. So my housing price increases by $100 for the next year. Now if I were renting? $2000/month. The landlord gets the absolute cheapest dishwasher they can find. It maybe runs them $300. So the landlord would be saving me ... $-475. Paying $5700 extra a year to avoid a $300 added cost makes no sense. Paying $6000 a year in perpetuity for a one-time expense that lasts the next 20 years also makes no sense. The point is that the tenant is not being protected from any added costs, they are paying way above market value for them.
jjav 4y ago
> But the real killers with home ownership tend to be large expenses that come due all at once. All these expenses (plus a profit margin) are built into the rent, of course. Two ways the owner handles them: Either they have enough money saved that they can absorb the spikes in cost, or, they contract some maintenance plan they have to pay every month but smooths out the costs to avoid surprises.