Landlord Hating

haters gonna hate
They see me rollin'
They hatin'
Landlording they tryin to catch me ridin dirty


This one goes out to all the people that live in over populated cities. That means you San Francisco, and I'm also looking at you Manhattan!

Next to bloodsucking lawyers, landlords are probably next in the queue of hated on people in the world. Actually, let me take that back -- everyone accepts lawyers as money grubbing individuals so no one really has to talk about it as if it were something new. And most people don't need lawyers so it's much less of a common ground for people to talk about. But most people have dealt with a landlord in their lives and it seems that lately, the new trend is to hate on them.

Look, I get it. You want to pay the least amount possible that you can for the roof over your head -- We all do! But it's a business son! Simple supply and demand, if people are willing to pay more, then why would I rent for less?

People talk about the horror stories of landlords kicking people out just so they can raise the rent. They talk about it like it's so commonplace but if you ask them who specifically this has happened to the only response I ever hear is that they read it in an article or "one of their friends knows someone that this happened to."

I for one, do know someone first hand that was forced to move out of their house so their landlord could renovate and then jack up the price. But in order for the landlord to legally do that they had to pay them to go. It was a hassle, they didn't want to move, but overall financially they actually came out ahead (for about a 2 year length of time then the money received verses the amount of new increased rent evens out.)

Look, I know that some places have rent control. Part of the reason rent keeps jumping up and up is because these people know they have something good so they simply don't move, thus keeping the supply of available houses lower. If you have one of these places then why are you looking to move? If you want a nicer place then expect to pay more, and expect to pay the market rate. Just because the shock of the new market rate is higher than you expected doesn't mean the landlord is the asshole. They are just keeping up with the market.

There are some horror stories out there, landlords decide that they want to "go out of business" so they use the law to help evict tenants. They then spend a few years off of the market, perhaps do some renovations, and then pop it back into the market at a new sky high price. It seems kind of greedy to kick people out for a few years just so you can jump up the prices but that's just how the law works sometimes.

But imagine if those laws didn't exist. Imagine if as a landlord you couldn't "go out of business" just because you were renting to someone that didn't want to leave? If that were the case, I know that I would raise my rent so high that I would have so much income that I would never want to stop renting my house. Or if there wasn't a law that required landlords to pay out tenants that they want to evict so that they can "go out of business". Then people would be kicked out and not have any compensation to find a new comparable home to rent.

Look, rent sucks -- In places like San Francisco it's sometimes insane, but there are alternatives. For instance you could not move so much. The longer you stay in the same place the more likely you are to have lower than average rent, especially if you have rent control. You could also decide that the city is not worth paying that much for and move somewhere else or even just a cheaper neighboring city if you still want to stay nearby. If you choose to spend 65% of your income just on your rent then you really only have yourself to blame, you could choose to live somewhere else. I know it's not on the top of your list of things you wanted to hear, but sometimes the city you love might just be too expensive for you. Another thing you could do is save as much money as you can and buy your own home so you don't have to worry about rent, fixed rate mortgages don't change.

Don't hate on landlords for the market rate. If they were pricing rent too high then there would be a lot of vacancies and prices would settle down. But right now that's not the case so it keeps going up, ultimately it's the renter that decides what they are willing to pay.

Don't hate the player, hate the game.

20 comments:

  1. I am a landlord myself, renting out a home that I used to live in that I converted over into a rental property. Landlords, me included, will ask whatever they believe the market will support. If rent increases because of property values or upgrades in the home, so be it. It happens, that's life. I used to rent as well, and like all renters, I wanted the best value for my dollar. But when rent increased, rent increased. It was a part of living that everyone has to deal with.

    Just remember that renting is a choice. If people truly want a steady monthly payment for years upon years, then a mortgage will do that. Of course you're paying a bunch of interest along the way, and some people's credit scores don't exactly set them up for an affordable mortgage at times, but this again is all the result of the choices that people make in life. These are all tradeoffs. If you don't want/can't get a mortgage, then guess what? You're going to be dealing with rent.

    That said, there are pretty shitty landlords out there. There are also nice ones (I try to be one of the latter). I think it is wise to remember that when you stumble upon a shitty landlord, it may not be that the landlord is a dick. Instead, being a landlord can be frustrating business. If you get the wrong tenants in the house, it ultimately costs the landlord more money to fix damages and maintain the property for often-times unruly tenants (and in many states, the eviction process is near impossible). There is a good chance that your "dick" of a landlord is that way because, over the years of renting to bad tenants, saying no and keeping control over everything that happens in that house might be the only thing left for him or her to protect the value of the house. In other words, it goes both ways. There are bad landlords, and bad tenants.

    Even more than hating the game, learn to play the game. If someone believes that it's somehow greedy for a landlord to improve a property so they can charge more, then I'm afraid they don't have much concept of how our system of economics actually works. Like you said, rental properties is essentially a business. Improving the product improved revenue (and, hopefully, profit).

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    1. Steve,

      I've heard of shitty landlords before. They don't fix or upgrade things, not very responsive, but at the same time those are usually the ones that don't really increase rents because they just want to completely forget about their tenants. I like to think that I'm a good landlord, my tenants live in my house since I rent out the other rooms so I'm pretty responsive if anything comes up. I can't simply ignore them because I see them everyday. But at the same time I've heard them just talk shit about landlords before as if I wasn't in the room with them. They talk about he horror stories and how all landlords are scum and I just think, "well maybe it's time to raise rent since I haven't done that in the past 3 years..."

      Anyways, my point was that even though I fall under the "good landlord" category (I'm judging this by the fact that my average tenant has stayed for 3-5 years) they still seem to just jump on the bandwagon that landlords suck and it's okay to talk about. Similar to the way that people think that lawyers are just bloodsucking money grubbers (sorry brother!).

      Also like you said, you should just learn to play the game and be in the position you want to be.

      -Zee

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    2. unfortunately renting is not a choice, having a roof over ones head is not a choice, its survival.

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  2. I agree with you. I've never been a landlord myself, but if I were one, I know that I want to make the most out of my investment. There are also bad tenants out there, and I feel many people forget about that part and blame the landlord if there's any conflict in the tenant-landlord relationship.

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    1. Luckily I've never really had to deal with bad tenants, but I do hear about them all the time. I've also been to some of my friends houses where they rent and I think, either the landlord left this house in crappy condition or my friends have treated this place like crap since they have lived here.... Usually I default to my friends treating the place like crap since they have been there for many years.

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  3. I turned my house into a rental when I moved into my wife's house. So far, I haven't had any issues. I was able to get a tenant right away, even though I was charging above what the market was getting. She stayed almost 2 years before relocating to be closer to family. My new tenants just moved in at the same rate.

    I do my best to balance things out. It's a business and I am trying to make money. But at the same time, I am human and so are my tenants. I make sure I respond to any issues immediately and I've had good success to far. My belief is that if you rent to good people and treat them fair, kind and honestly, they will respect when you have to raise the rent. When I do raise the rent, I justify why I do it. If they don't like it, they can leave.

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    1. Jon,

      Houses are probably one of the hardest businesses to separate from personal feelings.... wait.. Maybe that's just me because I live with my tenants. If I rented to people without living with them I wouldn't see the human aspect of it as much and I might feel less bad about raising rent once every 2 or 3 years. (something I'm also notoriously bad at doing)

      I think the key is to just do as careful screening of tenants as possible. If you can pick out some generally good people then you usually don't have any problems, at least that is my experience from it all.

      -Zee

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  4. I don't think I've ever hated a landlord. Sure, I lived in a rental house that was really run down and the landlord was really lazy and didn't want to fix anything (he had inherited the property), but even then I didn't hate him. As for rent, yeah, rent is insane in certain cities and rising at an exponential rate it seems. In Los Angeles, we're paying what a mortgage broker told us was equivalent to owning property (which is why we're buying a house this year!) At some point, though, rent will have to level out or there will be a ton a vacancies. It's all about supply and demand. The only thing I do wish some landlords would do is put a cap on the number of people who can live in a place. Right now we live right next door to the local colleges baseball team! ;)

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    1. Little House,

      Well, I wouldn't say the point was to say I actually "hated" my landlords or that other people actually hate theirs. My point was that everyone talks shit about lawyers as being bloodsuckers, it's just the stereotype they have gotten over the years. And I feel like that landlords are starting to get a similar stereotype just because people see them as "raking in their dough".

      Usually that's the goal with renting a home though, is to make it cover the mortgage, and that's usually where I imagine the break even point in the market. If renting was cheaper than owning then renting should start becoming more popular. But if owning is cheaper than renting then owning will become more popular. I don't exactly know how bad the rental markets are in Los Angeles, I know that places like San Francisco and Manhattan the physical land space just geographically caps things out so housing gets out of control since there's not as many places to go.

      I'm excited to hear about your house hunting this year, that's a big step and you seem much more well informed about it than I ever was when I was looking.

      -Zee

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  5. I've never rented, but I did rent some rooms out of our house to friends and family. All I can say is that when it comes to housing, emotions can run high. I wouldn't think most landlords are being greedy, but it could look that way if you think you're being gouged.

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    1. CheapMom,

      Housing is a very emotional space. I know that for me it took me a few years to get used to my house as my "home". It was like since I went to college I sort of lost the idea of where "home" was. There was places I lived, but none really felt like home anymore.

      Whenever you get emotions like that involved with money it can be a very delicate balance.

      -Zee

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  6. Zee,

    I don't think people in general don't hate landlords, they just don't like paying more for something. You see the same thing with groceries, for example. I don't even remember how often I've heard someone say "has this gone up in price again?!"

    In Belgium there is a lot of legislation that protects renters from their landlord. As a result, it's nearly impossible to get kicked out without mutual consent. Also, rent increases are limited to the rate of inflation, unless specific improvements were made to the rental property that warrant a higher price.

    Weirdly enough though, hardly anyone rents over here. The first asset young people buy is their own home. That's why real estate is so incredibly expensive compared to just renting a place. Of course, over the long-run many people will be better off with home ownership.

    Cheers,
    NMW

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    1. NMW,

      For me I think the stereotype of landlords sucking is becoming a lot more popular. I don't think many people really hate their landlords, but they just view them as business people that are taking all of their money. I've only ever come across one person that had legitimate problems with their landlord but it was more of lifestyle differences (since they shared a building with them).

      I just hear people complain about landlords all the time even if they have never had any really issues with their own landlords. It's like they just want to jump on the bandwagon and complain about them because it's the cool thing to do. Once I heard one of my tenants talking about landlords sucking "in general" which was weird since I had never raised rent on them the entire 3 years I had been living with them. I didn't understand what they had to complain about since all of the bad things they had to say about landlords were things that they had never experienced.

      -Zee

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  7. Hi Zee

    Landlords in the UK already have a bad reputation - the news in the UK is always full of stories of greedy landlords because it makes news - stories about tenants being happy with their landlords never makes the news, so I tend to ignore it when the press tries to tar us all with the same brush. Landlords have also almost single-handedly been blamed for the lack of affordable housing in the UK for people to buy and live in, again, with all the greedy accusations.

    I bought my apartment specifically to rent out, so it's an investment. I don't see myself as greedy, I'm just providing a home for someone who either couldn't afford to own or doesn't want to get a mortgage.

    I want to be a good landlord so I charge a fair rent, not the highest rent I can get. I don't increase rent if a tenant is staying (longest is 2 years) but will increase to market rate in between tenants. When things need fixing, I arrange for repair work asap.

    Maybe when your tenant was talking about landlords sucking in 'general', they weren't including you in that bracket. Maybe it's their friends/family who are having a hard time with a not-so-nice landlord, or as you say, they were just jumping on the bandwagon for a bit of 'landlord bashing'?

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    1. Weenie,

      I'm pretty sure that when my roommate was talking about landlords sucking they meant it in general. If they meant to include me in that group then I'm sure they wouldn't have said it in front of me, also if I wasn't being a reasonable landlord then I'm sure that they would have moved out years ago instead of continuing to live with me.

      It's funny how a group of people is blamed for things even if it's dictated by things such as market conditions. I don't think that any one group can be blamed for an entire section of a market. To me I just wrote about this because it really does just seem like a trend of landlord bashing just for the sake of complaining.

      -Zee

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  8. I guess it goes to show that you can never really please all people. My folks are landlords and they used to have a problem with someone who didn't pay the rent and didn't want to leave. Thank heavens for laws. It was an emotional situation for them both. However, they tried to be rational and fair about it. I guess, whatever side of the coin you're in, you just have to follow and do what's right.

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  9. Okay, for all of you stating that renting is a "choice", you are very, very privileged. Renting is not a choice for almost all of the people I know except for one. This is due to the harsh reality that you all don't seem to want to accept. The economy is crap, wages are stagnant and when you do get a job, it's usually below the poverty level which means that you cannot afford a home. Not just that, foreclosures are at an all time high and banks do not want to work with many owners. I know this because I worked in foreclosures. None of the renters I know of would want to rent if they could own. But can they, no!

    Stop talking like you're all elitists and don't understand the legitimate, life problems of the people you rent too. The problem with landlords is that they really don't understand, or just ignorantly forget that life happens. They have turned the way of big banks, it's all about the money and making sure that there whining comes first. In almost every state, landlords are favored in the courts when in a dispute with tenants. And no one here seems to mention that the reasons landlords are so hated, is due to the fact that with very little action on their part, the courts open up to protect them and only them, and suddenly the tenant is HOMELESS. Yes, each and every tenant deals with pleasing their landlord or homelessness. That is too much power. Especially if they don't have the funds to move. Then, when the lease is not renewed or they want to move, they have to pay the rent to the landlord they are currently with, AND the rent, etc. for the new place. Most people are whining about money on here but, do you have 4,000 + to spend on a new apartment, which you do need because the homeless shelters are full.

    Oh, and for all you landlords whining that tenants mess the place up, the reason they probably don't tell you about the broken trim in the corner, is because if you, as a landlord, repair it, their rent will go up. That's right! Any repair I have ever asked to make with a landlord, I have to sit their anxiously waiting for the lease to renew and to hold my breath seeing how much the rent will increase. Try living on 30,000 and less a year, with a $25.00 rent increase. Woops, there goes a good portion of my food for the week.

    Try getting a new perspective and flip their situation. But, I guess that would be too much to ask as I can't see that happening with most of you, due to your comfortable incomes that you have. Are you completely wealthy? No, but you obviously have enough to afford a home. A home that, over time, is yours. Not theirs.

    Are all landlords like this? No! But a good majority has, again, turned towards the attitudes of big bank. I have rented almost my entire life, due to the fact that I have worked hard but, with the recession, there was alot that hit me hard. I would not be renting from someone if I could.

    There's a good reason why landlords are not liked and they usually do it to themselves with their "elitist, holier than thou, this place is mine" attitude.

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    1. Perhaps you were reading more into specific comments than the point I was trying to get at with this article. The point I was trying to get across is that if I have something to offer, should I offer it at less than market value simply because people want to pay less? Even when I know there are more than enough willing people that will pay more...

      I do realize that most people cannot own their own homes. If your single and don't have dual incomes, it's even less likely you'll be able to afford ownership. Under 30, yep, tough again simply because you aren't into your prime income earning years typically. (I hope I haven't reached my peak earning years yet)

      Let's say you were a painter and you can make the most beautiful paintings and each painting takes you a month to complete. When you first started selling your paintings people didn't know who you were so you sold them for $100 each. After a few years, you had hundreds of people wanting to buy your paintings so you raised the price of them. Now you're still making paintings that take a month to complete but you're selling them for $1,000 each but there's only about 15 people that really want to buy them at that price, the other 85 people think it's too expensive and that you're just bleeding them for money. Would you lower the price that you sell your paintings for? Knowing full well that as soon as you've completed your painting you already have a buyer at your asking price. Do you listen to the people that complain about how expensive your stuff is? Or do you keep selling at near the peak of what you could earn for your time?

      That's what market rate is. That's how economies work, people have something, shelter, services, goods - and they trade what they have for something in return. Typically money in modern times. I just know that I have heard my roommates talk shit in the past about horrible landlords and how landlords are terrible, yet I know that I charge them much less than the market rate. I was commenting on how landlords are hated by some people even though the people that are hating on them have no reason to.

      I know it's ridiculously expensive to move. First + last months rent + security deposit, that's not chump change by any means. It just seems like there's a bandwagon of people that just want to complain about something that many people are willing to pay for. And clearly they are willing to pay for so if they were really adamant about not paying so much they would move somewhere cheaper.

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    2. Perhaps it's because I live in San Francisco, which is one of the most expensive places to live. People complain about rent all the time. You said that people can't afford to move, well I counter that argument with people just don't want to - at least here. When the cost of rent can be 40% cheaper by moving 5 miles further away to a city that is still connected by public transportation then that tells me many of these people aren't willing to make some lifestyle changes to not be rent-poor. There are nearby options that are significantly less, I don't believe everyone is on the cusp of either "pleasing their landlord or being homeless". I know that some are, I'm not going to argue that, but the majority aren't.

      I'm not saying moving is easy, it's a tough decision. Sometimes work is harder to find in some other place. But to say that you have zero options is bullshit in my opinion. If you are reading this blog then you're probably a few steps ahead of other people, you're probably not actually homeless or in a shelter. Cause my guess is that you would have better things to do with your time than comment on blogs if that were the case.

      Also, you are talking to a finance blogger here so I do know how much I live off of each year. This year was a strange year for me because of work related travel, but if I exclude my work travel related costs I spent about 26,000 this year (after taxes), last year it was closer to 24,500 (after taxes). So if I do my math correctly that would be about 32,000 per year that I would be making before taxes.

      I do know what an extra $25 increase in costs every month would mean, I get increases every year too, my HOA fees increase each year, my insurance costs go up each year. The world does not set a price and keep it indefinitely, bread doesn't cost a nickel anymore. I also know that housing isn't the only place to save money to make ends meet. For example, I just recently got a smart phone. I begrudgingly gave in after so many years because I didn't want an extra expense. So far, I've never met anyone else who held out longer than I have - especially in my line of work (software) and city (San Francisco).

      Things can be tight and tough when living on less than everyone else. But don't think for a minute that I'm preaching from some high horse and wouldn't know what it's like to live on much less than the average person because I do, and I have been for a long time. Most (not all) personal finance bloggers actually do live on less than the average person. Most by choice because they want a safety net to fall back on, or maybe they made financial mistakes in the past. Many are just money hoarders and want to save huge amounts of their income so they never have to work again, but in order to do that they have to live on so much less to make it happen.

      I also know it's different for me since I live on less by choice not by circumstance. But if you put me in that situation, you can bet I would make some drastic changes to live below my means again.

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  10. Having a roof over your head isnt a choice. landlords are lije pharmaceutical companies... its something you need so take as much money as you can. because if you want to survive you have no choice..

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