Presumably most landlords do behave exactly as you say. But if property values are increasing quickly then the landlord is getting money there, rather than rent

Presumably most landlords do behave exactly as you say. But if property values are increasing quickly then the landlord is getting money there, rather than rent, and the value of rent becomes relatively smaller. Also when a property is vacant the only real upkeep cost is property tax, which is pretty small (just tax land [0]!). You still have the opportunity cost of not renting, but if rents are also increasing fast then keeping a property empty for longer makes sense so you don't get stuck in a long-term lease at a low rent. Dunno how true this is, but anecdotally I notice commercial properties staying vacant for longer, presumably because they operate on long-term leases. [0] https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax