My “favorite” is when you get a rent increase despite overall dropping rents. The landlord would rather risk vacancy AND lower rent from the next tenant for the pure joy of inconveniencing you with a move.
I lived at a place many years ago, and the landlord wanted to increase the rent from 900 to 1300. Which was just a fantasy number for the area. I countered with 1000, because moving is a hassle and it was an ok place. They said no, so we moved.
Then the place was vacant for years afterwards. I always chuckled when I walked past it. Great job, instead of getting a steady income, you try to gouge your tenant and get nothing! Art of the deal level right there.
Whilst for some it might just be the inertia of “I increase the rent every year”, for many it will be a careful calculation, assuming that staying in the same place has an increasing value to you over time. It also helps with the overall dropping rents “problem” by helping to increase the average, and encourage other landlords to do the same.
I’m not convinced that landlords’ collusion to fix the cost of rent is the “careful calculation” that you’re describing. From my perspective, it’s quite the easy choice for them to extract more money instead of less money.
I only potentially benefit from an overall market reduction in rent (which rarely occurs) if I move to a new apartment because they refuse to negotiate a lease renewal at a lower rate.
“In April 2024, 17 landlords and property management companies filed an antitrust lawsuit against RealPage in federal court in Dallas, Texas. The landlords alleged that RealPage’s YieldStar algorithmic pricing tool allowed property managers to tacitly collude to set rental prices, effectively fixing rents in specific markets and suppressing competition.”
Yeah, in a market economy if they all started dropping prices it would just be a race to the bottom, which is good for some tenants but will probably result in less repairs and could lead to some properties going bankrupt and being bought out by larger companies.
The real value in these properties is equity, as in how much profit they will be able to realize upon sale, while the continued operations up to that point are a budgetary tightrope walk.
My “favorite” is when you get a rent increase despite overall dropping rents. The landlord would rather risk vacancy AND lower rent from the next tenant for the pure joy of inconveniencing you with a move.
I lived at a place many years ago, and the landlord wanted to increase the rent from 900 to 1300. Which was just a fantasy number for the area. I countered with 1000, because moving is a hassle and it was an ok place. They said no, so we moved.
Then the place was vacant for years afterwards. I always chuckled when I walked past it. Great job, instead of getting a steady income, you try to gouge your tenant and get nothing! Art of the deal level right there.
Perhaps they gave you the f-off, we don’t want anyone living in our house anymore number… Either way thats a horrible thing to put someone through.
It works.
Whilst for some it might just be the inertia of “I increase the rent every year”, for many it will be a careful calculation, assuming that staying in the same place has an increasing value to you over time. It also helps with the overall dropping rents “problem” by helping to increase the average, and encourage other landlords to do the same.
I’m not convinced that landlords’ collusion to fix the cost of rent is the “careful calculation” that you’re describing. From my perspective, it’s quite the easy choice for them to extract more money instead of less money.
I only potentially benefit from an overall market reduction in rent (which rarely occurs) if I move to a new apartment because they refuse to negotiate a lease renewal at a lower rate.
No. They don’t collaborate.
Don’t misunderstand your enemy, folks. They’re selfish, like Donald Trump.
“In April 2024, 17 landlords and property management companies filed an antitrust lawsuit against RealPage in federal court in Dallas, Texas. The landlords alleged that RealPage’s YieldStar algorithmic pricing tool allowed property managers to tacitly collude to set rental prices, effectively fixing rents in specific markets and suppressing competition.”
Uh. My dude, they do in fact collaborate.
Sure.
Yeah, in a market economy if they all started dropping prices it would just be a race to the bottom, which is good for some tenants but will probably result in less repairs and could lead to some properties going bankrupt and being bought out by larger companies.
The real value in these properties is equity, as in how much profit they will be able to realize upon sale, while the continued operations up to that point are a budgetary tightrope walk.