Submitted by LongjumpingShot t3_109x09s in baltimore
VygotskyCultist t1_j40u37v wrote
The program keeps people off the streets, if only temporarily.
I'd love to know more about your tenant's situation from their view because, frankly, I have no idea what the full story is, here. But even in the worst case scenario (i.e. they're gaming the system to get free housing), the program is still defensible. If 100 families game the system, and one person uses it in a time of genuine financial hardship, it's worth it to me. People are more important to me than your bottom line.
At the risk of sounding snarky, this is the risk you take on when you become a landlord. This is the life you chose.
Also, they're "almost" a year behind and you're already $25k in the hole? That's a lot of money you're charging for a single home/apartment/whatever.
TL;DR: Homelessness is worse than unpaid rent
EfficiencySuch6361 t1_j40wsf4 wrote
When landlords pause renting out their homes bc it’s too risky, it’s going to make homelessness a lot worse. Landlords aren’t evil… it costs a lot of money to own and maintain a home, especially an old one like most of those in Baltimore. Don’t know anything about the size, location, or status of the home OP is renting but automatically assume $25K per year is overcharging the renter? It could be a 3-4 BR place with a driveway in a very nice part of town where buying the equivalent house would be half million. Don’t forget that with all the taxes and fees and registrations, about $12,000 of that rent is going straight to the government if the house is owned outright… gets to keep even less if the house still has a mortgage
j_hess33 t1_j410bju wrote
Don't forget no one is forcing landlords to be landlords.
EfficiencySuch6361 t1_j4185ih wrote
Yes and that is a two way street
Expendable_Red_Shirt t1_j419dpd wrote
Having shelter is a human need and many people are forced to rent property rather than buy.
So in many cases, no, it’s not a two way street.
EfficiencySuch6361 t1_j41mcba wrote
Plenty of folks buy properties and let them sit vacant 50-90% of the time. How is that not even worse than renting a property out to be lived in? Just like choosing to be a landlord is an option… choosing to not rent out a secondary property is also an option
Expendable_Red_Shirt t1_j41n7so wrote
Choosing to not buy it is also an option and a better one.
Just because there are worse options doesn’t mean it’s a good one.
EfficiencySuch6361 t1_j41ts3z wrote
So invent time machine to go back to before the purchase and don’t do it. Got it!
Expendable_Red_Shirt t1_j41uk3x wrote
That’s not your point.
SpareCartographer402 t1_j41b2je wrote
No its not. Plenty of us are forced to be renters because assholes keep buying everything up to rent out, causing scarcity and higher market prices. So yes, fewer people can afford a house now. There's more to it then that but its a big issue, but I don't feel bad for the people who afford the property upset about losing 22k of passive income. That's part of owning a business. Vet tenets better. In this situation, renegotiate costs until there lease is up based on whichever hardship their on, maybe you could have made Atleast 10k and the less pressure and stress could have helped the family to fix their situation easier. Did he communicate with these tenants and figure out what's going on or just evict after 1 month? (Now the tenants won't work with you because you evicted them before trying anything else, Of course, they won't move out or pay up... theres no incentive, evections make it difficult to find a new place making leaving more difficult.)
EfficiencySuch6361 t1_j41i6ys wrote
Well yes it is, what I meant was that a landlord can choose NOT to rent their property and just let it sit there vacant. I know some older ppl with multiple properties who don’t need the money anymore and are tired of the hassle of dealing with overly entitled renters, so they let their secondary properties sit vacant. Which hurts both renters AND buyers
TheSpektrModule t1_j41ls4v wrote
We looked into becoming landlords a few years ago when moving. Did some informal risk/benefit calculations and nope, not worth it. Sold the old house, threw the money into an S&P 500 index fund. A house that could have been a very reasonably priced rental property stayed off the rental market. Turns out there are consequences to having a system that's unfriendly to landlords.
superdreamcast64 t1_j41ubs6 wrote
> A house that could have been a very reasonably priced rental property stayed off the rental market.
i don’t really see why this is a bad thing? rather than becoming a landlord’s 3rd property and sucking up tons of tenant money, the house went to someone who actually wants to own the home and live in it. we need more houses that people can buy on the market rather than forcing everyone to rent.
TheSpektrModule t1_j4217hc wrote
Re: why it's a bad thing, buying a home in Baltimore is already relatively affordable compared to renting. That suggests that we need more rental homes, not more houses available for sale.
There are many reasons you want a robust rental market. Buying a house is not always better. The general rule of thumb is that you need to live in a house for seven years in order for the transactional costs to be worth it. Lots of people are not staying here for that long. Baltimore has a lot of grad students, medical residents, nurses working at big hospitals for the first few years of their careers and just people who don't want to stay in the city after having kids. People have become more mobile in general. If you want those mobile people to be part of your tax base for at least a few years then they need to have decent rental options.
EfficiencySuch6361 t1_j41ufca wrote
It’s certainly not as lucrative here in Baltimore as some other places. It’s pretty standard especially in the pricier areas to only get 0.8%-1% of the purchase price as monthly rent, which is at the very bottom of the 0.8%-2% range that makes rental economics work. And if u can’t handle property management and at least 80% of the maintenance then it really becomes unprofitable quick. It’s not passive income I’ve discovered 😊 hopefully u feel good about the choice u made (which sounds very responsible)
TheSpektrModule t1_j421bh2 wrote
> hopefully u feel good about the choice u made
I wake up every morning thankful that I did not become a landlord.
dopkick t1_j41gh3m wrote
> Plenty of us are forced to be renters because assholes keep buying everything up to rent out, causing scarcity and higher market prices.
Yeah, that's not the case in Baltimore city. That is true in some cities but the whole "evil Texans are coming in and buying up all the property and driving prices higher!" narrative that some people love isn't actually happening here. There's still PLENTY of affordable housing here, check your favorite realty website. There's even affordable housing outside of the city if you want a more suburban lifestyle.
StarkyPants555 t1_j42hqyg wrote
That's not true at all. Homeowner here. I get multiple calls per week asking if I want to sell my house. There are signs all over the city offering to buy homes cash, as is. Plenty of out of state property owners as well, just sitting on vacants and waiting for the neighborhoods to gentrify.
dopkick t1_j42kj51 wrote
There are always a number of homes for sale under $250K in desirable neighborhoods. This is objective fact that can be checked by realty websites. If you cast a wider net you can find plenty under $200K, although it won't be in Fed Hill and the like (but still not bad - think Pigtown). For a vast, vast majority of cities such a price point is absolutely unheard of. Baltimore has plenty of affordable housing. If your idea of affordable is in-line with prices of run down homes in meth addict-ridden cities that have been declining for 50 years, then yeah I guess Baltimore isn't affordable. But good luck in those places.
I also get calls. They're cold calling in hopes of finding someone who wants cash now and they can score a deal. It's not unique to Baltimore.
StarkyPants555 t1_j46qonc wrote
Yeah most homes in Baltimore were constructed pre 1950. There may be several homes under the $200K price point in "desirable" neighborhoods, but will need significant renovations or upkeep in the coming years. Your point still does not address the fact that equity firms are buying up properties at a rapid pace in this city and it is getting worse. This objective fact can also be verified.
dopkick t1_j46tbey wrote
$250K is the price point for more desirable neighborhoods. Here's a short list of some homes in one zip code that are basically turnkey, are not blasts from the past, and don't appear to have anything excessively bizarre in the interior.
https://www.realtor.com/realestateandhomes-detail/1421-Race-St_Baltimore_MD_21230_M65021-79295
https://www.realtor.com/realestateandhomes-detail/1301-Clarkson-St_Baltimore_MD_21230_M68202-65940
https://www.realtor.com/realestateandhomes-detail/1433-Patapsco-St_Baltimore_MD_21230_M68696-80580
https://www.realtor.com/realestateandhomes-detail/1614-Elkins-Ln_Baltimore_MD_21230_M53295-58754
https://www.realtor.com/realestateandhomes-detail/1227-Durst-St_Baltimore_MD_21230_M51082-61512
https://www.realtor.com/realestateandhomes-detail/424-Sanders-St_Baltimore_MD_21230_M50255-26777
https://www.realtor.com/realestateandhomes-detail/1628-Jackson-St_Baltimore_MD_21230_M69552-05918
https://www.realtor.com/realestateandhomes-detail/1405-Jackson-St_Baltimore_MD_21230_M61305-34550
This kind of stuff is always listed, although the properties do vary.
proamateur t1_j42akp9 wrote
What?
Otto_Von_Bisquick t1_j41703u wrote
Respectfully, I think you're missing a step here. Landlords likely won't "pause" renting if it is too risky.
They will either divest themselves of an asset that is not returning, increase rental requirements narrowing their pool of renters(because no renters), or not invest in a rental property in the first place.
Rather placing their capital into markets with more favorable returns. People aren't taking on second mortgages to hold empty property. Like this person said they are losing money because they do not have a renter.
This decrease in demand from capital holding people will have an equivalent effect on housing prices.
This is not to say the land lording class does not provide an essential service to the economy.
Just what we are seeing here is a natural process in economics. This person is experiencing risk they opened themselves up to when engaging with this asset. Same way someone in the stock market may see decreases and downturns.
Animanialmanac t1_j424neg wrote
I live in Southwest Baltimore. Multiple houses are now vacant because landlords paused renting, it’s the main reason for vacants. Many landlords in my area inherited the house, started renting because they couldn’t sell, or rent out part of the house they live in. When the city doesn’t honor their commitments for rental assistance these landlords stop renting. They don’t sell, new families don’t want to buy here now. The houses sit empty, on my block ten of the twenty four houses are empty, almost half. All empty because the current owner either inherited and rented it out for a while before giving up, or moved away, couldn’t sell and gave up renting after bad experiences. Almost half the houses on both sides of the block.
This is recent in my area, but I believe this is how areas of west Baltimore because blighted. The assumptions that all landlords will divest their property and a new landlord will maintain it as a rental is false.
EfficiencySuch6361 t1_j417qgg wrote
I know landlords that have already done what u are saying they won’t do but alrighty. Ppl don’t sell all their stocks bc the market is bad today and they’re retiring in 25 years from today. It isn’t infeasible to wait out bad policy decisions for a temporary problem vs selling at inopportune moment or losing a bunch of money in hand to realtor fees
Expendable_Red_Shirt t1_j419mpu wrote
That’s a poor analogy. Stocks don’t cost money. There’s no loss or gain until you sell.
Real estate costs money. Many of these places have a mortgage and even if they don’t you need property tax and maintenance etc.
Otto_Von_Bisquick t1_j41bvfs wrote
It’s close but no cigar. Would have to view the relative lack of success of an individual’s stock choice relative to overall market success as a loss for stock to work
Maybe a leveraged position that actively costs money is closer
EfficiencySuch6361 t1_j41m27c wrote
Or maybe u are both missing the point that wasting $10,000 on a realtor before making back renovation costs vs waiting 1-2 years for bad policy to be fixed isn’t as cut and dry as these ppl who clearly have zero landlord experience seem to think
Otto_Von_Bisquick t1_j41nbek wrote
Yes, on the individual level people will make that choice.. When you look at the market at large, which is either growing or shrinking, there is no pause.
The entire market doesn't go on hold because the people you know are on pause. The larger market influences people at decision points of where to deploy capital.
Your friends have deployed capital and are willing to take a short term loss for a long term gain. (Likely forgoing gains already incurred). Some individuals are choosing different areas of the market to invest in. Some individuals are getting out of the market entirely.
Again you are having trouble separating personal experience from market forces.
EfficiencySuch6361 t1_j41tn6l wrote
A larger entity would have even greater tolerance for such circumstances. U continue to fail to understand that there are more options than just selling secondary properties when times get tough
EfficiencySuch6361 t1_j41lth4 wrote
TIL owning stocks is free!!!
Expendable_Red_Shirt t1_j41m7fh wrote
Yes it is.
Buying them costs money. Owning them is free.
EfficiencySuch6361 t1_j41twsj wrote
>Stocks don’t cost money
No I read that they don’t cost money
Expendable_Red_Shirt t1_j41uiq7 wrote
To maintain.
Did you read the context or no?
EfficiencySuch6361 t1_j41uygs wrote
U are acting like individual stock picking skill is the ultimate bell weather of stock market success when the fact is that the federal reserve’s interest rates policies move the market more than any other factor by indisputably huge margin. So no I didn’t “read the context” bc what u are saying is wrong and doesn’t make sense, and u very obviously don’t know hardly anything about real estate rental property investments while trying to sound like the foremost expert
Expendable_Red_Shirt t1_j41vwpt wrote
Who are you talking to because I literally said none of that
Which you’d known if you read it.
It’s ok to be wrong dude. You don’t have to resort to making shit up.
Animanialmanac t1_j4256p3 wrote
What maintenance? Have you seen some of the empty rentals in Baltimore? Some are so poorly maintained they collapse, killing people. Holding on to property until better city leaders are in place and the property increase in value is called real estate speculation, people do it all over Baltimore.
EfficiencySuch6361 t1_j4292ff wrote
Ahhh yes I forgot that every vacant property isn’t receiving any maintenance at all city-wide
Expendable_Red_Shirt t1_j425z3w wrote
The solution is repossession not writing that off.
Animanialmanac t1_j427x8u wrote
Do you mean receivership?
The city can’t repossess a house, a bank could file foreclosure proceedings and then file for possession if the property is mortgaged, most of these are not mortgaged.
Receivership is a long expensive process in the city. At the end of the process the city will own the property. The city also fails at maintaining the city owned vacant properties.
Expendable_Red_Shirt t1_j428bgf wrote
Lol. Ok dude. Way to honesty engage.
Otto_Von_Bisquick t1_j419djn wrote
"I know people"- the mantra of the anecdotal evidence.
I am describing a natural economic process and didn't say you don't know people. I am saying there are larger market forces beyond an individual decision and that your original comment didn't speak to that.
If you multiply your known landlords by a million do you think there hasn't been a decrease in willingness to expand rental operations.
It is hard to think conceptually so take your time if you need to.
Edit: Hell even in your response you almost get it. "They don't sell ALL their stocks". Exactly. All landlords aren't gonna sell all houses
anne_hollydaye t1_j40vuj7 wrote
You were far more polite about this than I would have been, so I'm just going to agree with you.
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