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Comment by SQueeeeeL | Hacker News Reader

Prices for rent are such a weird ratchet effect, they may only go up. It basically shows that landlords really aren't that interested in being efficient market actors, it's also about validating their own egos (even on an institutional level). If prices were to decrease, then they may see a direct loss of revenue, versus an empty unit which is simply an "unrealized asset"

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Huh? In NYC in the middle of COVID rents had gone down by like 20% in some parts.

What do you mean, rents may only go up? That's not how it works anywhere. It's only true over specific time periods.

It’s a bit more true in the commercial sector. But even there it will eventually collapse or be sold off.

That doesn't seem to be the case according to https://www.redfin.com/news/redfin-rental-report-july-2022/

Edit ignore this I misread the comment

Huh? Yes it does, that article literally shows national median rents decreasing in 2020.

But rental changes are literally neighborhood-specific. COVID had some neighborhoods in NYC flat, others rising, others falling.

In any case, rents fall. That's the point. It's normal.

I misread your comment because i thought you said "now"

I'm currently renting an apartment in SF for 25% less than the previous renter paid because I rented it right at the bottom of the pandemic bust.

Rents are subject to supply and demand just like everything else.

I imagine marginal costs of occupation like wear & tear, utilities carried by the landlord, and so on would increase that loss of revenue you mention, and push the calculus even farther towards letting it sit unoccupied.

Don't forget the recent experience with the government forcing you to let someone live in your property for free...

Commercial property mortgages and valuations are strongly based on rental rates - and until vacancies hit a certain percentage they’re not counted much at all.

One popular way to “flip” an apartment building of 100 units or so is buy one that is 100% rented and slowly raise rents until it is 80-90% rented and then sell it n

By definition when you have constraints on the natural levers of supply and demand in the form of price controls, markets aren’t going to act rationally.

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