patrick.net

oh what the hell, may as well persevere... i'm back from work...

FormerAptBroker Says:
Most landlords will sign a longer lease if it makes sense for them. In areas of high turnover most landlords will give you a lower rent for a longer term lease, but in an area with increasing rents you will probably have to pay more to lock in a flat rent for multiple years.

The landlord isn't even interested in signing a 6 month lease where I am. They prefer to keep a rolling monthly agreement after the first 6 months has lapsed. The rest of the discussion is therefore theoretical and moot, and longer terms are not normally entered into in this country, but I'm not personally interested in signing even a 6 month lease either, as it reduces my mobility and options.

What do you mean by “wholesale” (we don’t use that term to describe real estate in the US)?

Wholesale is actually accurate in this case, it's sometimes used by foreclosure buyers and RE gurus to mean 'very cheap', but in fact as the owner was the developer, they own the units at cost or construction price, rather than adding the 25-30% retail markup that most individual investors have to pay to the developer. Working backwards from nominal retail, then, they got a 20% discount over most investors. They just had to be able to manage finance on 70 apartments at once, but it's probably no worse than an investor managing a single apartment, in fact, it's probably easier once you get tenants in.

> However, he wants to charge marginally *above* market
> rates right now because he thinks he can, at a time when
> rates are supposedly rising rapidly.

Unless a market is regulated by the government a landlord can’t get “above market” rents.

Comparable prices in the area for similar apartments. Technically whatever they get *is* the market, but the Tribunal doesn't see it that way when it comes to rent increases.

You are better off trying to make a deal on your own, let the other 6 make their own deal.

unity is strength. we can bombard the tenancy tribunal with 20 similar applications. i'm going to try to reverse the increases for everyone, though, as many are not confident negotiators. and these are stressed students with limited incomes.

What rent control does it give a small number of people a good deal at the expense of landlords and any new people that move to the city.

poor old landlords, always losing money. why the expense of newcomers? can't see why. anyhow, rent control schemes can be devised in any number of ways...

I don’t think you read that I have not taken a penny from my parents since my freshman year in college when they threatened to stop paying for college if I joined a fraternity to “goof off and drink beer”

I haven't had anything much since the age of 15. They purchased properties later, just before the boom...

Shmend Rick The Pious Says:
sean, i just want to make a rare positive statement here, but I always read your posts. you obviously have a good liberal arts background and it shows. you would probably make an excellent scotch drinking buddy, but from what I understand you are living down under. ive lived there for a year and I love aussies and your country to death. what a great bunch of people.

yay. must swap addresses. i haven't commented on 'post-autistic economics' yet, i'm waiting for just the right moment...

Ace Says:

"...All we had here was fruit canary industry..."
_____

Is that a type of bird?

SP,

Maybe some folks think Indira Gandhi is a man...

Jon,

Fairness is irrelevant. When you rent, you're paying for a temporary right of occupation to the true owner of the property. There's no reason you should have any rights beyond the terms of the lease.

I simply don’t put someone’s right to (unlimited) profit above the sanctity of another’s home. People go on and on how it ruins the market, etc. I see absolutely no evidence of that here. Fairly applied, rent control is a benefit.

I know a woman who pays $470/month for a four-bedroom apartment in Manhattan, two blocks from Central Park and a block from the Dakota (where John Lennon lived/got capped). She started renting that apartment in the late 70s. That’s an example of unfair rent control. Not all rent control works that way.

Jon,

You just provided the rebuttal to your own argument here. Although rent control --& Prop. 13-- sound like great ideas on the surface (gee, saving $$ at my LL's expense, how wonderful!), such selective redistribution schemes typically result in worse inequities than they were supposedly designed to "fix" (i.e., the cure is worse than the disease). I have yet to see a "well designed" rent control system that did not create severe market distortions that were UN-beneficial to the majority of the general public, as well as lots of bad incentives (to game the system). In other words, it usually creates big, counter-productive moral hazards.

Shelter is a basic necessity and is the ‘base’ around which people structure their productive lives and the lives of their families. I’ll say it again: when people are forced to drop everything, uproot their families, incur moving costs, and in some cases, change jobs, the community and society pay a price that is not justified by the LLs right to maximize profit under and all circumstances.

If you want to remove the profit motive and consider shelter to be a basic citizen "right", then I would suggest supporting government-built housing for the poor. Rent control is one of the most ineffective, inefficient and costly ways of subsidizing housing for poor people. Most of the time, the truly poor see no benefit at all --it's the smart, rich, crooked types that are most successful at gaming the rent control game.

I have yet to see a “well designed” rent control system that did not create severe market distortions that were UN-beneficial to the majority of the general public, as well as lots of bad incentives (to game the system).

Because any price control system will create severe market distortions.

What is fairness anyway?

astrid Says:
Fairness is irrelevant. When you rent, you’re paying for a temporary right of occupation to the true owner of the property. There’s no reason you should have any rights beyond the terms of the lease.

that's a narrow view of decently providing shelter in a society, though...

Peter P Says:
>I have yet to see a “well designed” rent control system
> that did not create severe market distortions that were
> UN-beneficial to the majority of the general public, as
> well as lots of bad incentives (to game the system).

Because any price control system will create severe market distortions.

This is just more of the same neo-liberal market dogma and fundamentalism. It's like a neural network which always oscillates to the same answer no matter what the inputs.

This is completely unsubstantiated by argument. You've looked at *one* system and said therefore that all systems can't work. (And maybe the system *does* work for many, just not in your view.) This is just a nonsense. Talking about scientific reasoning, because one rocket misfires means in your logic that no rocket will ever get off the ground and there will never be a space shuttle. People invoke 'scientific reasoning' when it's convenient and then proceed to prove they don't have any, and they have a 'one size fits all' answer. Where does this neo-classical market brainwashing come from, by the way?

In other words, it usually creates big, counter-productive moral hazards.

The only 'moral hazards' I see are exploitation of workers by landlords, unhelathy economic bubbles which are harmful to both the micro- and macro-economies, and incredible unfairness and disenfranchisement of a sector of the population for the enrichment of others. That's my definition of a 'moral hazard'. The original defn of moral hazard was from insurance companies talking about the question of whether it becomes too tempting for a businessman to torch their business and claim the insurance. It now means anything which jeopardises so-called 'free markets' apparently, as redefined on this blog.

The whole cycle of creating 'haves and have-nots' also increases crime and anomie, which I see as 'counter-productive' also.

just a test post