Comment by betterunix2 | Hacker News Reader

Comment by betterunix2 | Hacker News Reader

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"maybe people shouldn't be able to make a living out awating rent?"

It's not exactly free money -- landlords do have to deal with the maintenance of the property, fixing/replacing broken appliances, and so forth. Before a landlord goes bankrupt they will cut back on maintenance that is not absolutely essential (something I lived through in my younger years, seeing benches fall apart, trash not being removed, and weeds taking over the front and back yards of the building), and eventually would not be able to pay for maintenance that actually is essential (good luck getting your plumbing fixed when your landlord cannot pay the plumber). There is also the matter of cascading bankruptcies when large numbers of landlords are not being paid, resulting in their loans no longer paying (likely dinging retirement accounts and pension funds).

The fact is that a major shake-up in how we organize housing e.g. getting rid of rent-seeking landlords would be difficult in normal times. Doing such a thing during a deepening economic crisis would make everything worse for everyone, including people not directly involved.

Sure, but are they doing $1k+ worth of maintenance work a month per unit? Certainly not. Many landlords probably spend more time sending out bills than they do on maintaining the property.

> Sure, but are they doing $1k+ worth of maintenance work a month per unit?

There ain't no such thing as a free lunch. In a market with units for sale and for rent, prices tend to reach an equilibrium. The only difference is that rent includes a premium for the relative ease with which one can move.

Another way of looking at it is that traditionally it was considered reasonable for annual rent to be 1/20th of the purchase price of a property. Likewise, 5% annual maintenance was considered reasonable. Unsurprisingly … 1/20th == 5%.

> Many landlords probably spend more time sending out bills than they do on maintaining the property.

That was certainly not my experience when renting. My most recent apartment had multiple full-time employees maintaining it and had an annual improvements budget. I won't claim that it had all the amenities I would have liked, but the landlord was definitely not just letting the cash roll in.

I doubt many landlords are making $1k+ in profits each month. Most of the rent is paying for the mortgage, property taxes, and other fees (all of which you would have to pay if you owned your own home). A landlord also needs to set aside money to cover costs on properties that are vacant (and even a landlord who only rents a single property will still face occasional vacancy in the best of times) or whose tenants are not paying rent. Then there are all the other things, like maintenance, insurance, and so forth. Whatever is left over after all that is the landlord's profit.

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