I was 1/2 a day """""late""""" with rent (as in, it was the 1st, and i didn't have it when the landlord came to see me in the morning, as i was on my way to school) came back to find the locks changed, was told i was evicted and even if i paid rent for the next month, all it would get me was my property back.
(reminder, they were demanding i rent for the next month, that hasn't happened yet, as condition to retrieve my property, while telling me it wouldn't result in me being allowed to stay in said unit i just paid the next months rent on.)
Had to use legal counsel help to put a stop to that bullshit.
A few didn't pay me for the last 5 months, and things did not work out with the state.
I will never rent a property again. This pandemic has shown me exactly who is disposable. No governor will again decide that my tenants don't need to honor their payment agreements.
May landlords vanish; I am no longer among their number.
https://en.wikipedia.org/wiki/CARES_Act#Foreclosure_and_evic...
The proportion of rental units owned by individuals used to be a large majority, but has been falling and recently dipped under 50%. As of the 2018 Rental Housing Finance Survey [1], there were 48 million rental units in the United States, with ownership breaking down as:
41% individual
37% LLP, LP, or LLC
3% real estate corporation
3% nonprofit organization
2% general partnership
2% trustee for estate
2% real estate investment trust (REIT)
10% other or unreported
I don't have numbers, but I'd imagine it looks even more skewed in the direction of professional landlords if you looked at major cities.
> 37% LLP, LP, or LLC
All of the individual real estate investors I know wrap their rental properties in an LLC. It's trivially easy to set up and manage an LLC these days.
Unless those numbers are somehow separating out individual LLCs, I would assume a lot of those LLCs are owned by singular individuals.
I would bet that a good chunk of the trend you’re asserting is just small time rental property owners increasingly using LLCs to limit their liability.
In fact, as of the time of that report, one of the largest real estate investors in the US, Blackstone Group, was organized as an LP and went in that category (they changed forms to a Corporation in 2019). A few large real-estate investors still organized in the LLC/LP/LLP form are the BH Companies, UBS Realty Investors, Harbor Group International, AEW Capital Management, and Invitation Homes.
No, creating an LLC for your RE business does not require the use of a management service. The exact same individual landlords can own properties through LLC as without; the LLC just grants them some liability protection.
The rate of increase of professional management is also pretty high: the 2015 survey had 43% of properties professionally managed, which had risen to 54% by 2018. I'd be willing to bet it's more like 60%+ now as there's been quite a bit of buying into the rental market by large investors.
None of this is correct. An LLC is just a legal structure you create for a few hundred bucks using a two page document online. They're not 'passive investors buying into an asset class'.... you can still be a mom & pop with an LLC. I'm sure most tiny retail businesses are an LLC too.
I didn't personally see the statistics about professional 'management' on the page that you linked, but that doesn't make one a large-scale investor either. Property management companies usually collect 5-10% of the monthly rent, which is a tiny amount of money, so they're incredibly small scale or shady fly-by-night operations. I suspect you saw a statistic that includes the guy that mows the grass and patches the roof, and thought that was 'professional management'.
I think a better/more focused stat would be to understand how many properties or units each investor owns, rather than continuing to misread this table about an industry you're not familiar with. If you own 1-2 small buildings, you meet my personal definition of 'mom & pop operation'
Seems like the net size of a corporation is an indicator of how little we as a society want it involved in our daily lives - the bigger they get, the more effectively they are exploiting a rent seeking niche, in this case literally.
In Texas you can use a series LLC to separate risk between properties with a single LLC, but it is the only state I know of that offers it (*I may be misremembering based on a BiggerPockets podcast from a couple years ago).
Almost all of the issues I've had while renting were with small landlords. Corporate landlords at least held up their ends of leases in my experience.
I'm not terribly sympathetic to landlord in this situation. As far as I can tell, it's the greedy, lazy landlords that get taken by these people - if you follow the letter of the law, keep your premises in good shape and document everything, it's pretty hard to be taken. Oppositely, a lot of landlords skirt the law on a regular basis.
So we're saying that making it so tenants can't defend themselves against illegal evictions is going to increase the housing supply incrementally?
No number of lawyers allows a tenant to just flagrantly break the law.
The thing is, many landlords casually break the law and generally benefit from doing so - they fail to make timely repair, they take deposits unjustly and so-forth. Most tenants put up with this since fighting it isn't worth their while - the advantage the small opportunistic landlord takes is like a tax that tolerable though not pleasant.
Occasionally you get a sort of cagey and kind of crazy person who turns around and uses all the shenanigan of the sloppy landlord against them. The "grifters" - I've seen these types. Sure, they too will break the law but they get their mileage from the normally sloppy and abusive behavior of the small landlord.
The original poster I replied to on this thread believed that legal aid for tenants is what allowed these "grifters" operate. I dispute that and even more dispute the idea that not legal giving tenants legal aid would increase the housing supply. As I noted, the so-called grifters know the law and removing their free lawyers isn't going to change much. It's average tenants who need lawyers since they don't make a business of staying in apartment when a landlord is trying to legally or illegally evict them.
Further, a change making it easier for a landlord to illegally evict a tenant wouldn't improve the housing situation - the illegally evicted tenants would be looking for more housing and the opened-up units would be at a higher price.
I think there's definitely a problem that needs to be addressed, and that many landlords are bad actors in many markets, and that may tenants are bad actors in many other markets. I'm not even sure that landlording makes sense, it's rather feudal. I'm pro realistic rent control. I just think that, short of throwing away the entire system and making a revolution (that would kill millions), we should approach the problem from a carrot and stick perspective, not a stick-only perspective.
If you want to make eviction hard for the average tenant, fine. But if you leave it at that, where's the incentive for renting to riskier tenants? There's nothing re-balancing the risk exposure, nothing that makes up for the risk-adjusted expected loss of renting to a risky tenant. If we want these risky tenants to be housed _while_ preventing undue evictions, we need to fix up the incentive structure so that landlords still have something to gain from renting to risky tenants. Otherwise, why would they do it?
The only "punitive policy" that's being discussed is giving tenants free lawyers so they can defend themselves in court.
I don’t know where this image of the “yeoman” landlord is coming from, these people are clearly financially stable enough to speculate on a human necessity but also want to be able 100% shielded from any risk? That’s not how business works, though maybe that is how business works now given how many companies and banks US taxpayers are expected to bail out.
Well, the state does provide lawyers to the prosecution side, since the prosecutor is the state.
Easy, by having the government send Men With Guns to confiscate it from you.
You don't just get to send men with guns to take large chunks of peoples wealth without dire social and economic consequences. To believe otherwise is pure fantasy.
In many places in the US we have government officials who decide who gets to live in which house and how much they will pay for rent. Tenants are part owners in properties, sometimes majority owners.
OK, sounds promising
> ..use that tax to subsidize housing
record needle scratch sound.
Subziding housing drives up the price, because it increases demand for housing. Have we not learned this lesson? After so many years, this basic economic fact is still tripping people up?
Please, stop with the housing subsidies. Why do you want to make housing more expensive?
Also, politicians have to be accountable for the subsidies which means that restrictive zoning will burn a pocket into the local budget. They don't give a damn about losses due to rent control. I.e. they privatize political gains and socialize the economic losses.
The idea that the price of housing will not increase if a good is subsidized because the supply isn't "prevented from increasing" is so confused and wrong it literally makes me sad.
We have the data of house prices rising as a result of subsidies. Housing is half land and half structure, and in constrained areas, 80% land and 20% structure. Land does not increase. Moreover even if housing was all structure and land was free, the subsidies cause houses to become bigger, as people can afford more structure, leading per house prices to rise.
Then you continue with a string of cliches, "privatize gains" etc. And a complaint that other people don't care enough.
Well, OK, but what of it? We don't shoot ourselves in the foot because other people don't care.
Adopting policies that make the world a worse place just because you are morally outraged is a terrible way of doing public policy.
The other issue is that you can't 'win' in court against someone with no assets. If they owe you thousands, haven't paid rent for months, severely damaged the apartment.... they don't have any assets to seize. And a judge, especially in a blue state, is not to authorize anything harsh. They can essentially not pay rent or badly damage your place with zero consequences
The mega-corp landlords are much more savvy when it comes to dealing with grifters and con artists, to the point that they will usually avoid taking them on as tenants (e.g. via extensive background checks). Small-time landlords are getting savvier, but not at the same speed.
> Which is increasingly common.
And given the above, they will be probably become the norm in a decade or so.
If the court finds in favor of the tenant, that means the landlord screwed up (and probably broke the law, too).
I'd also point out that "investments" in a "free market" aren't supposed to be risk-free. If the landlord can't hack it, whelp that's their problem as a speculative investor.
So, I was already broke from thousands in unpaid rent, then got notice that she was fighting the eviction and would be represented in court by a pro bono lawfirm. So I had to scrounge my last $ and remember not to fill up my gas tank all the way, to hire the town's cheapest attorney to go in and settle, letting her stay an extra month free of charge to agree to leave. Finally she illegally overstayed that and only left the day before the cops were to show up and forcibly remove her. This is all while she's living on gov't cheese and blowing her money on booze and festivals.
In all I was out many thousands of dollars I didn't have and basically couldn't sleep in my own rented room for over a month, and got fought in court by fancy lawyers paid with tax-deducted charity money. I spent a while seriously considering, and my only other option would have been, to end my own lease and leave and let my landlord deal with trying to remove her.
So no, I was actually at risk for becoming homeless due to this situation as the "landlord", and I get fairly angry when its described in this blithe way as if the person fighting the eviction is always the poor little guy and the "landlord" is always BlackRock having to eat a 0.001% hit to their profit margins.
I'm not making this up and these are not my rules or opinions. It's just the logical conclusions these people come up with, given the environment they're faced with.
this dynamic will always be true: "folks with higher incomes are seen as less likely to trash the place, less likely to sue, less likely to stop paying"
Basically, this is somewhere I think govt. _constructive/supportive_ intervention is needed, because today's punitive policies creates economics that don't allow a humane end result.
I think we should build more single unit affordable housing! And shove it all over the place, in affluent neighbourhoods! Help people leave their problems behind.
This thread is getting deep for HN and it's hard to respond, but I had shoved my random thoughts on this in https://twitter.com/AntoineGrondin/status/145489614700107776...
We know how to plan this properly. Mistakes will no doubt be made but there is no reason to think they will be this obvious.
Almost everything you describe is the effect of a housing shortage. The new houses wont happen overnight, it takes quite a bit of time to create a surplus.
if they could fix the housing crisis my bombed out city straight after ww2, I'm pretty sure the US is able to do so 80 years later with modern construction methods.
No one wants a medium income rental due to that. And I'm thinking about being a landlord - as I'm moving - and evicting a tenant that refuses to pay for 6 months while I still need to maintain the property and pay mortgage is prohibitive. The risk there is scary high for what shouldn't be risky.
https://www.quora.com/Was-Adam-Smith-against-landlords?share...
The Soviet Union didn't have landlords to deal with, but the housing situation was not any better - just instead of apartments being unaffordable, you'd get in a queue for public housing that was like 20 years long...
At the beginning of their project, many people lived in huts so the step up to small stark apartments was a huge step up for millions. After a few decades though, they appear to have failed to improve their housing infrastructure at a fast enough rate. I don't know exactly why.
Some sources I've read say that once Krushev (and his base of support) were in power, they redirected resources into consumer goods to try to match western lifestyles too early. The previous plan was to constantly reinvest in heavy industry which creates exponential growth by providing the material basis for more heavy industry. This shifting of resources away reduced the rate of growth as the population continued to grow and resulted in a stagnating standard of living.
This makes intuitive sense to me so far, but I have not done enough research to say this is conclusive.
I would point out that in the US, we have the perception of being able to move wherever you want given enough money. However, in reality we are restricted (queued) by the affordability of housing and moving. The people at the top do have real freedom, but the bottom sections (most of them not present in this highly paid programmer forum) have very little.
That aside, you can't look at economics of USSR in isolation from its politics. For example, under Stalin, most peasants were effectively tied to their land in kolkhozes and sovkhozes - they couldn't freely move to the cities where the better-paying jobs were, and thus couldn't compete for housing there.
The urban centers had something like 10-20% of the population. If the peasants all moved to the cities, there would a) be not enough jobs and b) no food as no one would be producing it.
And I'm not saying that producing those things is an investment, but rather that Soviets consciously invested into heavy industry to the (rather significant) detriment to the rest of the economy, so as to have manufacturing capacity to produce them.
> The urban centers had something like 10-20% of the population. If the peasants all moved to the cities, there would a) be not enough jobs and b) no food as no one would be producing it.
Well, the peasants wanted to move to the cities because the pay and the overall quality of life there was better. Peasants in kolkhozes were essentially serfs, with the government coming and literally taking the "excess" of their food output away. This could have been solved by, you know, actually paying them properly for that food. But why pay when you don't have to, and would rather spend that money elsewhere - e.g. on industrializing the cities?
One thing to keep in mind here is that Bolsheviks were very much not a peasant party. In the Constituent Assembly (which was directly elected by the population), they were a minority, and the most numerous party was the Socialist Revolutionaries, who actually represented the immediate interests of the peasants. Which is precisely why the Assembly did not rubber-stamp the Bolshevik government, and was forcibly dissolved.
Similarly, in village councils, Bolsheviks rarely had a majority - so they introduced kombeds to override those unruly councils. Also, when the council system was first codified in the 1918 Soviet constitution, the Congress of Soviets (i.e. the ultimate legislative body) had one representative for every 25,000 constituents of urban councils, and one representative for every 125,000 constituents of rural councils - i.e. one factory worker effectively had the same voting power as 5 peasants .
These kinds of things is why there were so many large peasant uprisings in Soviet Russia early on, to the point where they had to use poison gas to effectively suppress some of them.
Taxes on money and land holdings. If you spend your money you do not "win" because you pay transaction taxes (VAT etc) or you increase your exposure to risk in the financial markets. If you don't spend your money you lose because you pay the wealth tax for nothing.
The reason why a land value tax works is that land already exists. It's supply is inelastic. The owner of the land did nothing to create it. So taxing the owner for holding onto land will not discourage him from working (building a house and renting it out). The tax revenue can be used to pay for public infrastructure like transportation then the value of the land goes up which will directly fund the infrastructure. A holding fee on land discourages speculation because the expected value of holding onto land without utilizing it is negative. The reason why land speculation is so profitable is that location is a monopoly. As the community around the land develops the speculator benefits off the work other people while doing no work himself. It's especially bad when income taxes are used to fund infrastructure. As the government does more infrastructure projects and charges higher income taxes your rent will go up as the value of the land goes up.
Just a thought experiment: A single tax implementation of land value taxes implies that you've paid your taxes by paying rent. Rent would still be expensive but products and services would be cheap and your income would be higher.
OTOH there's still the libertarian left. But Soviets and other leftist authoriarians were always as hostile to it as they are to anyone right of them.
I think it'd make sense. It's beneficial to govt. to keep people productive and ultimately off the street. Hence (in a capitalist system) they want to encourage the market to provide housing to people who would otherwise not get it. If the government came involved into transactions as a guarantor for people in need, and provided incentives and reassurances to landlords that they would not be disadvantaged if they provide housing to those in needs, I believe there would be less homeless people in the street, and more generosity from landlords.
E.g.:
(1) if I have no upside and a high risk exposure in providing housing to a recovering addict, will I do it if I'm then unable to evict that person when they fall back down into addiction? No, I wouldn't, even if in my heart of heart I wish I could help them.
(2) if on another hand, the government came and said "we'll guarantee this market rate, and will facilitate eviction proceedings and pay for repairs if things don't work out", would I be willing to risk it and rent to that person? Probably yes, there would be enough structural support to encourage me to do some goodwill help.
The problem is that the stick presented in (1) is what's going on right now, and there's no carrot (2). It's basically the policy makers telling landlords: all you, don't you dare taking in tenants who are a higher risk! Because if you do, we'll be watching!
* * *
In coordination with this, I think a smart policy would be to combine this idea with something else: instead of trying to build affordable housing projects, try to spread these initiatives around. Avoid the creation of ghettos. If a govt. agency was to support someone's tenancy, the agency should try to spread these people uniformly around town, mixing them with all strata of society, instead of putting all these people in the same geographical area. This would encourage reintegration in a constructive environment. People living in their walled gardens would be annoyed, but ultimately, the people in need of help would be allowed a chance to heal in a safer environment.
It is only fair way for system to work.
New York City had a decline in evictions when it was enacted (the decline outpaced nearby areas).
Everyone that has a dispute with a landlord is a grifter and con artist? That's a strawperson to beat all strawpeople.
> When I worked in commercial real estate
Is that the attitude toward renters in your industry?
Why would landlords be expected to be any more honest? IME, everyone who has had a legal dispute with a landlord has been an honest person with an honest claim (though not always legally supported), and landlords have had enormous power over them. I have no doubt there are some bad people in both camps.
followed by a rant about the indignity of the poors having access to legal representation (?!?!). And an appeal to mom-and-pop immigrants to provide smoke cover for commercial real estate developers and the local landed gentry.
This is where "eat the rich" comes from. I'll take my flag-dead for this one.