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The problem with rent control policies is the value of properties have gotten away from what the rents justify. For a normal investor this means evicting everyo
by carom 2y ago
The problem with rent control policies is the value of properties have gotten away from what the rents justify. For a normal investor this means evicting everyone and rebuilding. For a coop that is trying to keep things rented it means that they are unprofitable.
In LA for example, you can never get a rent controlled rent back to market. If someone is paying $600 for a 1 bedroom you're never going to catch back up to $1800.
All that said, I don't know why it has to be non profit. What you described is a just a real estate developer. Zoning is a more limiting factor than anything else.
- bombcar 2y agoThe idea would be a real estate developer that has no reasons to extract profits beyond what is necessary to operate. By staying near market rates you’re not “lottery winning” some people. By reinvesting all profit into additional units, you’re going to slowly drive the costs down.
- kjkjadksj 2y agoIt depends on the market. Rent control in LA is 4% a year allowable increase. Rents supposedly went down over the last year or two so rent control worked in the favor of landlords that year who raise it 4% no matter what happens. And once you have priced out your tenant with the constant march of yearly 4% increases you can set rent at market rate or even higher if you’d like after they move out. In other words the $600 rent controlled apartment is a myth.