3 ms·
how could/would they not? everything is paid by the renters, and if the price is not high enough (to turn a risk-weighted profit) it will be removed from the m
by pas 3y ago
how could/would they not?
everything is paid by the renters, and if the price is not high enough (to turn a risk-weighted profit) it will be removed from the market.
(if there's a high enough vacancy tax and/or security costs against squatting, then eventually it will be sold. which is a one time boon for the market, but it ends up crowding out new developments for a while, and altogether this just leads to crazy waitlists and the usual discrimination.)
- jeffbee 3y agoI don't know anything about the French rental homes market but in the USA there's ample headroom in lessor profits to take a haircut without triggering the second-order effect that you hypothesized. Landlord income as a share of GDP (again, in the USA) stands at a post-War high, having increased 15x from its low around 1990. Landlords have a huge and largely unearned cashflow and the thing about taxes is it's best to try to raise them where the money is.
- HDThoreaun 3y agoRental supply is fixed in the short term. Therefore landlords have no pricing power unless they are colluding assuming theyre trying to maximize profit and not giving tenants a deal. Landlord goal is to rent every unit for maximum amount, that means renters set the price by competing with each other.
- chaorace 3y agoKind of the same deal as rent control in a lot of ways, right? What you get is a short-term suppression of market rates that slowly get internalized by the supply-side until prices more/less return to the original equilibrium