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Here's the other popular and illegal apartment building inflation practice that doesn't require software: * Make very stiff penalties for accepting anything be
by heroprotagonist 3y ago
Here's the other popular and illegal apartment building inflation practice that doesn't require software:
* Make very stiff penalties for accepting anything besides a 12 month lease, EXCEPT when the renewal date falls outside of a designated 2 month period.
* Set this 2 month period to coincide or overlap with the same renewal period every other major player in your housing market uses.
* For any lease renewing outside that 2 month period, change up the optimum price point you offered to be a slightly shorter or longer lease period. This will shift tenants into the desired renewal period within a few years and you'll benefit even if they switch buildings in the long run, as long as most other buildings are doing this too.
* Add very strong penalties for lease-breaking, including such tactics as charging as much as 135% of the monthly rate for every month remaining on the lease. Unless they re-rent the building, and then the fee is 135% - whatever they get for rent for that period (hint: want a cheap apartment for your employees? Use the lease breaker apartment and charge them the difference!)
* Add the same 135% increase for the post-lease month-to-month period to force any renewals to make their decision quickly during that renewal period.
Get enough major players to do the same in the same area, and you have:
* Artificially increased demand during that designated 2 month period when everyone in the area renews.
* Artificially constricted supply during the same period, as renters won't release their current place until they've found a new one.
* Ensured that any newcomers to the area will get locked into the same renewal cycle within a few years at the most.
Even if they leave your complex, as long as you've shifted their renewal cycle you will benefit in the long term. There's one less apartment available for rent and one more apartment seeker looking for a place during the same period that most others are looking.
This is one of the major causes of housing inflation. Also, homelessness as people get priced out of the housing market.
A lot of other things go into the reasons we're seeing 5-10%+/year rent increases when the population only increases 0.5%. Way too many of them come down to exploitative wealth extraction by multistate or multinational corporations. This wealth does NOT flow back into your community.
- heroprotagonist 3y agoWe can generate a rough distribution estimate of this behavior pretty quickly.. If you start at an EVEN distribution of renewal dates right now (it's unlikely but for argument): After 1 year: 33% renewing in the same 2-month period After 2 years: 50% After 3 years: 66% After 4 years: 83% After 5 years: 99% The actual distribution is going to be less than that 99% due to a lot of other factors. Such as only 80% of the leases following this same practice, and move-in/move-out pressure in an area. But the impact of this behavior will still be seen. This practice is price fixing. quick code: import pandas as pd import numpy as np # Initial distribution: 1000 leases evenly distributed across 12 months initial_leases = 1000 // 12 months = ["Jan", "Feb", "Mar", "Apr", "May", "Jun", "Jul", "Aug", "Sep", "Oct", "Nov", "Dec"] # Initialize a DataFrame to track the distribution over 6 years distribution = pd.DataFrame(0, index=np.arange(6), columns=months) distribution.loc[0] = initial_leases # Set initial distribution # Function to update the distribution for a given year def update_distribution(year): for month in months: if month in ["May", "Jun"]: # 12-month renewal distribution.loc[year, month] = distribution.loc[year - 1, month] else: # 10-month renewal # Calculate new expiration month (10 months later) new_month_index = (months.index(month) + 10) % 12 new_month = months[new_month_index] distribution.loc[year, new_month] += distribution.loc[year - 1, month] # Update the distribution for each year for year in range(1, 6): update_distribution(year) # Displaying the distribution distribution.T # Transpose for a better view
- anigbrowl 3y agoThis is pretty much how the health insurance market works.
- hhnhaada728288 3y agoThis is exactly what I am trapped in right now.
- CogitoCogito 3y agoEveryone should by law have the right to break a lease with 2 months notice. Seems like a fairly simple solution to keep these dynamics from happening where people all start new leases close to simultaneously.