Re:San Francisco Apartment Rents Crater Up to 31%, Most in U.S.
by cnst on Wednesday October 14, 2020 @11:48PM
(#24784721)
> 15 years in sf apartment leases are unusual except for people who cannot afford to move out.
I'm a little confused here. If your rent is 1.2k for a 2bd in SF (because resident since 2000s), whereas market rate for a 2bd now is 3.9k in SF -- what is your determination -- is a person able or not able to move-out?
Why would anyone move out every 2 to 3 years if they're rent-controlled, and they'd have to pay significantly more for any new place?
Likewise, if you've been owning a property since the old times, and it's fully paid off, the property tax liability in Cali is tiny, and for older owners perhaps entirely a wash-off due to infamous Prop 13. Which is part of the reason that many owners don't even bother renting their properties.
In my experience, most market rate units turn over every 2 or 3 years. 15 years in sf apartment leases are unusual except for people who cannot afford to move out.
If you assumption, as a landlord, is that the next person into your unit isn't moving for 15 years, then yes, the cost calculation moves. However, that calculation is very different from a 7 year calculation, which is very different from a 2 year calculation. So how much are you going to hedge against not losing money in the future, when you're losing concrete money right now?