4 ms·

Prop 13 and high interest rates incentivize Landlords to aggressively price their properties to just break even. On my property in Seattle-area, my monthly cos

by itake 3y ago

Prop 13 and high interest rates incentivize Landlords to aggressively price their properties to just break even. On my property in Seattle-area, my monthly cost is $4k (interest, insurance, and upkeep), but the most I could rent it for is $3.2k/mo. If the tenants don't pay me rent and utilities, I can't evict them for months.

mikeyouse 3y ago
Prop13 - which keeps property taxes low for people who don’t turnover buildings - incentivizes landlords to seek high rents? Just nonsensical. Landlords seek high rents because they are capitalists and charge as much as the market can bear. That shouldn’t be controversial.. there are indeed all sorts of distortions caused by eviction moratoriums and renters rights laws, likewise there are distortions to refineries due to environmental laws. Just part of the ‘cost’ of doing business.
- itake 3y ago
  > Landlords seek high rents because they are capitalists and charge as much as the market can bear. I am a landlord. This is completely false. I rent out rooms in my house to help me cover the cost of living in my house. Lets take the property in SF you mentioned: property taxes: $1,600/mo mortgage: $10,253/mo [0] repairs: $1,269/mo (1% of home value / 12) total costs: $11,682 / mo zEstimate for rent: $5,495/mo net revenue: -$6,187/mo As a landlord, I want to get my rental income as close to the costs, so I can stop bleeding money on this property. I can't change my property taxes, mortgage, or repair costs, but I can push rent as high as can I can. Once my costs are covered, my next biggest fear is vacancy and bad tenants. One bad tenant will easily cost me $100k. My only option for bad tenants is to self-insure, and that self-insurance money must come from somewhere... [0] - https://www.zillow.com/homedetails/1273-Arguello-Blvd-San-Francisco-CA-94122/241586122_zpid/ https://www.zillow.com/homedetails/1273-Arguello-Blvd-San-Fr...
  - mikeyouse 3y ago
    But that's not Prop 13 at play since it's a single-family home bought recently -- do the same math for the 6 unit building across the street paying $6k/year in taxes.

by itake 3y ago

mikeyouse 3y ago

Prop13 - which keeps property taxes low for people who don’t turnover buildings - incentivizes landlords to seek high rents? Just nonsensical. Landlords seek high rents because they are capitalists and charge as much as the market can bear. That shouldn’t be controversial.. there are indeed all sorts of distortions caused by eviction moratoriums and renters rights laws, likewise there are distortions to refineries due to environmental laws. Just part of the ‘cost’ of doing business.

itake 3y ago
> Landlords seek high rents because they are capitalists and charge as much as the market can bear. I am a landlord. This is completely false. I rent out rooms in my house to help me cover the cost of living in my house. Lets take the property in SF you mentioned: property taxes: $1,600/mo mortgage: $10,253/mo [0] repairs: $1,269/mo (1% of home value / 12) total costs: $11,682 / mo zEstimate for rent: $5,495/mo net revenue: -$6,187/mo As a landlord, I want to get my rental income as close to the costs, so I can stop bleeding money on this property. I can't change my property taxes, mortgage, or repair costs, but I can push rent as high as can I can. Once my costs are covered, my next biggest fear is vacancy and bad tenants. One bad tenant will easily cost me $100k. My only option for bad tenants is to self-insure, and that self-insurance money must come from somewhere... [0] - https://www.zillow.com/homedetails/1273-Arguello-Blvd-San-Francisco-CA-94122/241586122_zpid/ https://www.zillow.com/homedetails/1273-Arguello-Blvd-San-Fr...
- mikeyouse 3y ago
  But that's not Prop 13 at play since it's a single-family home bought recently -- do the same math for the 6 unit building across the street paying $6k/year in taxes.