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Rents are certainly not always higher than costs. Plenty of "investor" landlords buying properties that return less in rent than the mortgage expenses of said p
by Panzer04 2y ago
Rents are certainly not always higher than costs. Plenty of "investor" landlords buying properties that return less in rent than the mortgage expenses of said property (or the cost of capital).
Making 4% in rent isn't great when the mortgage interest is 6%. The difference is made up out of the landlord's pocket, and they gamble on capital gains to make up the shortfall (or rising rents vs a mostly fixed mortgage expenses)
- dahart 2y agoSure, rents can be temporarily lower than costs in the short term. In the long term if that happens, the landlord ceases to be a landlord.
- JumpCrisscross 2y ago> rents can be temporarily lower than costs in the short term. In the long term if that happens, the landlord ceases to be a landlord In the very long run, yes. In the medium term, as in decades, home-price appreciation has let landlords in several markets run at a loss and rely entirely on capital gains for profits.