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Sorry for the late response, not sure if this thread is active anymore. By correction, I guess you mean a slowdown or stall of the rent rate rise. I'm just sayi
by rdsubhas 11y ago
Sorry for the late response, not sure if this thread is active anymore. By correction, I guess you mean a slowdown or stall of the rent rate rise. I'm just saying that enough damage is already done here, and what we'll see is just two extremes (obsession or recession). Given that so many people's livelihood depends on having a roof above their head, there has to be a better option.
I don't know exactly how Germany is planning to implement these laws. But at least I feel a sustained rate of growth should make life better for everybody in the city, rather than plain rent caps or slabs.
- ChuckMcM 11y agoThanks again for responding. By 'correction' I mean rents reverting to market rates rather than speculative rates. When that happens a lot of people will go bankrupt and often in those situations there is a time where things are cheaper than they 'should' be (by market forces). Foreclosed homes in the US was a good example of this, since the bank will sell at any price, it allows the price to go much lower than if people are selling. When your loan holders get desperate because the loan is due and no one is willing to pay their extortionate rent, they will either go broke (lender reclaims the property and sells it at a loss) or reduce rents dramatically to insure 100% occupancy (lowering prices to capture more of the demand). Sometimes both, rents will go down and the people owning the buildings will go bankrupt. If you're willing too, let me know what city this is happening in, I'd like to put it into my crawler to flag articles about rents to watch how this plays out over time.