I think this goes beyond simple overleveraging. For landlords, an aspect of their risk mitigation was the ability to have legal recourse for non-paying tenants:

> Weaver ... says the eviction moratorium is just a "pause" because it doesn't mean that "the landlord can never collect the rent."

> In practice, though, collecting rent money will be extraordinarily difficult after the moratorium is lifted. The case backlog in housing court could mean that landlords will wait years for their cases to be heard, and recovering large sums of money is difficult under the best of circumstances.

> Owners say that having almost no legal recourse when their tenants don't pay their rent was not part of the deal when investing in real estate. Landlord groups around the country have sued on the grounds that halting the judicial process that allows them to retake their property violates their due process rights.

I think it was reasonble for landlords to assume that, in the worst case, they may not be be able to find a renter but would at least have the ability to live in the house themself. Now they can't even do that.

As Hasan Minhaj pointed out, the result of thousands of minor landlords going bankrupt will be the further consolidation of the industry into large commercial landlords (which are worse).

https://www.youtube.com/watch?t=1030&v=MPFPBzr7FgY&feature=y...

You could make the exact same point towards the renters who were banking on their job to pay the rent. One is called a mortgage while the other is called rent.

There's a difference between working to eat, and investing. Investments have inherent risk, and if you can't bear that risk, don't overleverage yourself.

Reading the article, the owners aren't exactly rolling in it and are also depicted as mostly working class. If it wasn't for a global pandemic, most would have been fine and they would have thought to have invested very conservatively. In my mind, it's just that it's convenient/expedient to make them eat the cost of unpaid rent -

> depicted as mostly working class.

What "working class" person owns investment property in NYC? They amount of capital required to do that is so enormous that the article calling them "working class" is deeply misleading. They certainly aren't working class in the way that most NYC tenants are.

I love it. Too poor to invest in property? Working class.

Have enough money to invest in property? No longer working class.

It’s attitudes like this that prevent the working class from participating in the generation of wealth through capital. As soon as they dip their toe in, they’re now “rich” and get the rug pulled from under them.

I mean, the ownership of property - particularly land - and the use of that property to derive one's income is exactly what differentiates the working class from the ownership class. Landlords are pretty unambiguously in the latter; rent-seeking is not work.

This seems like a great theoretical internet take and not applicable to the real world in the least.

So some 50 year old blue collar dude who saves just enough to buy a duplex and live in half of it, but can’t stop working or he’ll starve, has suddenly been propelled from the working class into the lazy, cigar-smoking, top hat twirling capital class?

Yes.

If he wants to not be in that "lazy, cigar-smoking, top hat twirling capital class" (as you put it - because apparently hyperbole and gross misrepresentation of an argument counts as "discussion" on Hacker News nowadays), he is welcome to transition his ownership of that duplex into, say, a housing cooperative consisting of himself and the other half of that duplex (or - more likely - a cooperative for the land and the duplex's exterior, and retain ownership of his own unit while putting the other unit up for sale - effectively forming a COA, but cooperatively owned).

Don't put the hyperbole on me. I'm just repeating what I hear from the far left. They love to pain landlords as some evil 1%ers when in fact many are middle income people trying to get by.

And great, start a cooperative. But for everyone else who wants to rent a place, there are landlords.

Having known someone who owned and personally maintained a small apartment complex, you are wrong. My FIL is the hardest working person I know.

> My FIL is the hardest working person I know.

A landlord's wealth derives from being a middleman between the tenants and the property, not from the landlord's own labor. That wealth is quite literally the whole point of being a landlord in the first place; if the income from rent didn't significantly exceed the value of the labor your FIL performs as "maintenance", then why would he bother with dealing with all the headaches of property ownership if he could instead just be an employee of the tenants themselves (said tenants forming e.g. a housing cooperative)?

That is: there's nothing a landlord does that the tenants couldn't do themselves (whether directly or by hiring someone to do it on their behalf). It is therefore not labor alone that defines the relationship between a landlord and one's tenants. Your FIL may be "the hardest working person [you] know", but he's still a middleman in the ownership class.

Sure the landlord is doing something I can’t, as a tenant, can’t do myself - if all I have is an income of a few thousand a month and I need housing, the landlord is providing me housing I couldn’t otherwise afford.

You could pool your money with other people needing housing and collectively obtain that housing, with all y'all having equal ownership of it. This is known as a "housing cooperative" - kind of like if you rented from a corporation, but one in which you and your fellow tenants (and nobody else) are all equal shareholders.

A housing cooperative is about as economically efficient as it gets; you and your tenants would only need to pay the bare minimum to keep up with loan payments (and possibly, as I've proposed elsewhere in this thread and others, a land value tax) and maintenance, with no middlemen taking any cut out of your rent.

But what if I don't want to own?

If I'm some early 20's person just starting out, no money to my name, I need a cheap place to rent. I don't want to own or in fact, I probably can't own.

And it's not just early 20's people. I moved to a new city for 1 year with the intent of returning. I don't want to buy anything, I want to rent.

Landlord's are providing me a service in that case - housing.

> If I'm some early 20's person just starting out, no money to my name, I need a cheap place to rent. I don't want to own or in fact, I probably can't own.

Which is exactly why it's handy to be able to pool resources with other people looking to do the same thing, thus spreading the debt (if there is any) - and the risks thereof - across multiple parties. Think of it less like a real estate purchase and more like a startup, because that's what it is.

> I moved to a new city for 1 year with the intent of returning.

In which case a housing cooperative would've served your needs just fine. Again, less like owning a home outright, and more like owning a share in a company (because, well, you would own a share in a company). And when you're done with it you can sell that share.

But I don't want to buy and sell into a cooperative. I can't pool my money, I have none beyond my paycheck. I want to rent a place. I need landlords for that.

I've heard stories about cooperatives in NYC and the bureaucracy can be a negative. It sounds like an HOA or condo board.

What kind of housing someone can afford is a political question. Our current answer to it is that this should be resolved through market mechanisms, which creates high prices alongside scarcity

Ain't even the market mechanisms themselves that drive the high prices; rather, it's what those market mechanisms track.

Transitioning from land prices to land rental values - i.e. gradually moving toward a 100% land value tax - would address both high prices and scarcity by taxing land consumption - and, accordingly, encouraging urban density in order to amortize that tax, thus alleviating scarcity and reducing residential expenses. Same market at play (a land value tax definitionally taxes the market value of land); vastly improved outcome.

If you're just starting out it doesn't matter if homes are $100k or $1M, you don't have money to purchase.

People act like renting is some sort of evil forced upon people, but don't realize there is a big market for renting. People don't always want to own their own housing.

There’s nothing wrong with renting, I support strong, high quality, inexpensive public housing. I don’t support private landlords and the commodification of housing.

Property management is work. Owning property is not. For small scale landlords, this is often the same person, and they may do a lot of property management.

There are plenty of investments that are much more conservative than taking out a loan to buy real estate. Most of them don't even come with mortgage payments.

The difference being that you can choose to take out a loan and buy a house, but you can't really choose not to pay rent (unless you want to be homeless of course, but that's not an option I would recommend to anyone)

Except now people are literally choosing not to pay rent. And there are no consequences. So who wins in this scenario? The landlord is screwed over, and the house is taken by the bank. Then they sell it at a loss cause its filled with a useless nonpaying tenant and that bombs all the housing prices in the neighborhood. Millions of dollars will be lost, corporations will come out ahead, and everyone is worse off. Brilliant, this moratorium.

Excuse me, but if a libertarian website tries to paint the landlords as victims by giving some extreme (but still anecdotal) examples, I'll take that with a grain of salt. Especially the first example:

>Gao discovered that one of his former tenants had given her keys to a friend who had moved in without permission. Gao has never met the squatter now living in his house and is afraid to contact this person out of fear that he'll be sued for harassment.

So it's not that the tenants were forced to stop paying rent, someone who doesn't even have a rental agreement has simply moved in, so the landlord would have every right to get them evicted, but chooses not to for... reasons?!

Did you read the rest? He can’t get the eviction because of squatters’ rights and courts being shut down.

Do you also find it hard to sympathise with people who are trying to escape the trap of poverty? If I made assumptions about your circumstances, would I be surprised?

I really don't understand why we insulate landlords from investment risk so much. At the end of the day they can sell the place to mitigate their losses. What recourse could renters have?

Who's going to buy an apartment with a squatter in it? There's no easy way out for these individual landlords.

Buyers don't purchase properties that have been taken over by squatters that can't be removed.

At least not at market prices.

The risk was created out of thin air by a random choice of government policy.

If it’s the govt stopping you from collecting rent then the govt should make you whole.

This isn’t market risk. This is govt fiat that is causing the financial troubles.