Everyone here loves to complain about landlords without realizing that the majority of single family home landlords (not corporate landlords) are barely making it by too.
Banks are really the ones making criminal amounts of money. 1/3 of rent is typically interest payments. 1/3 of rent then goes to taxes.
For instance, I make $2,900/mo. from rent, but pay $2,800/mo. for the mortgage. I’ve spent over $8k this year alone on repairs and maintenance. But please continue to complain how landlords are constantly raking in cash. It’s typical for a homeowner to pay 1% of the cost of the property per year to maintain it. I will never see a positive cash flow until the mortgage is paid off in 25 years. The only benefit I get by continuing to own the property is the appreciation in equity and principle payments to the mortgage. At the end of the year we will have a -$7k cash flow and $5k equity appreciation. In a HCOL area, that $5k on paper is less than 3% of the area’s median yearly salary.
I feel for anyone out there who has a landlord that didn’t consider the hidden costs and the fact they should expect to runa negative cash flow, because it’s those landlords that also can’t afford to fix the house you might be renting.
I agree, there are people who try to exploit the system, and those people deserve 100% of the hate. And I appreciate the nuance you bring to the discussion.
There are those that will villify small-time landlords for the gall to try to make an extra cent. Ultimately, small-time landlords provide a very valuable service, with extremely tight margins. Frankly, it is just barely worth it for us to keep that home. Because additional risks that go into it includes a tenant trashing the place, skipping out on rent, the property being vacant between renters, rental listing fees (which amounts to a month’s rent typically), and so on.
In return a tenant is able to enjoy a home that would otherwise be unaffordable to them, zero risk, and the flexibility to move without being stuck in one location. If someone is only going to live somewhere for less than 3 years, it will always be better to rent than to buy, and take the money saved renting and invest that into the market. The renter is this case will always make more money in return. Some markets around the country would require someone to live in that home for over 10 years before they break even over the advantage of renting.
Surely you must ignorant of the economic realities and risk of owning a home and how renting can actually be more lucrative depending on your circumstances.
Oh yes, it costs me $7k a year for the pleasure of managing a property, responding to all the tenants needs, the risk of paying for major future repairs, trusting the tenant to pay on time and in full (collections is practically impossible to enforce), dealing with vacancies while I still pay the mortgage, paying real estate agent fees which amounts to a month’s rent every time I get a new tenant. And that’s all for a house that I am not able to live in, and that I have locked up 20% of the house’s value for a down payment. It’s much more profitable just to let that money sit in the stock market instead.
But please tell me more about how you know better and that’s it’s all sunshine and rainbows for a non-corporate landlord.
For us, it’s because work required that we temporarily relocate. But we plan to move back in a couple years and we really like our house.
For others it usually has to do with the fact that selling a home costs 10% of the home’s value after all fees are accounted for.
Then there is the other set of people who genuinely think the equity in a property is more lucrative than money in the stock market (depending on the market and timing, it could be, but it’s ultimately a bet).
But I could ask the same question of every single person bemoaning the existence of landlords. If it’s oh so easy to be a landlord, why don’t they just become a landlord?
I guess getting that initial capital required no work at all either.
Why don’t they just get that initial capital if it’s so easy.
Unless someone was born with money, the argument against non-corporate landlords (97.5% of single family homes are owned by non-institutional investors) is nonsensical, because those owners had to work for the initial capital.
You are absolutely right on all accounts. I’m sorry you’ve had shitty landlords, I wish there was a better way to weed those people out, because as it stands, the balance of power is heavily in the favor of the landlord due to the micro-monopolistic nature of renting a place for years at a time.
Renting vs Buying is very dependent on your local market. I have friends in Ottawa that I’ve run the numbers for and it would literally never be profitable to purchase a home compared to continuing to rent. Some areas two years is the break even point. These days with high interest rates, the break even on buying vs renting is after about 5 or 6 years. I encourage anyone to check it out for themselves! :)
I could’ve have been clear, but my situation has a very slight net benefit for me, and since my tenants only plan to live in the are for two years, they are getting the better end of the deal. In the end though, there is a mutual benefit and that’s what a competitive market should tend towards (as opposed to the monopolistic nature of corporate apartment housing which encourages the opposite).
My point is that the people who hate all landlords instead of just the bad ones don’t understand the economic realities of housing. It’s actually the mom and pops that rent out their homes for a short period that make renting cheaper on average for the market as a whole. Mostly because they are imperfect businessmen/women and don’t understand the full cost of being a landlord before it’s too late. Instead, most mom and pop landlords are just hoping to break even.
Yes, but you fail to understand the difference between a peninsula and a psuedo-island (a piece of land entirely surrounded by any body of water, artificial or manmade).
The Colorado River starts in Colorado is does not flow over the continental divide.
You would think so, but there is one river that happens to flow and split over the continental divide called North Two Ocean Creek. It’s the tiniest technicality that makes this map technically true.
Small aircraft have a carbon equivalent to large cars. My plane is from 1961 and has a fuel economy of 15mpg as the crow flies (arguably closer to 25mpg because of straight line measurements versus winding roads that can almost double the distance), seats 4 people comfortably, and flies at 160 mph.
The aircraft hold their value, and actually appreciate. The actual cost is about $10k a year. Lots of people spend far more than that on other hobbies.
Over half of all pilots in the US (200k) hold a commercial pilot certificate and use flying as their sole source of income or as a way to supplement their income. Commercial pilots makes $50k a year until they can become airline pilots which have salaries starting at $100k.
The system is broken (lemmy.zip)
Roots of Mother Appalachia (mander.xyz)
cntraveler.com/…/appalachian-mountains-may-have-o…...
xkcd: Dubious Islands (imgs.xkcd.com)
Source: xkcd.com/2838/
An "airport neighbourhood" where people can store their planes in their yard and taxi directly to the runway (lemmy.ml)
Location on a map: www.openstreetmap.org/?mlat=42.1486108&mlon=-…