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Comment by ausbah | Hacker News Reader

>Over the past four years, Gajavelli built his real-estate empire using funds from dozens of small investors who wanted a chance to earn a landlord’s riches without any of the work.

there are few "professions" lower than landlord in my book. they induce artificial shortages in already scarce housing supplies, implement regulatory capture in zoning & rental laws, skirt existing regulations in the quality & livability of their units, require hundreds to thousands of dollars in "application fees" and other upfront charges, help keep home ownership rates down, and more all while playing off rent seeking behavior as some sort of "better than you" game

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I don’t have the nerve to become a landlord. It’s just finically risky, can be lots of work, and the payoff…is mostly hoping property prices rise. I hear horror stories about deadbeat tenants who manage to destroy a house before they are evicted.

I have a hard time feeling sorry for landlords in these scenarios. Welcome to the cold world of business. Sadly, your property being damaged is simply a risk of that type of business, and just like I wouldn't be sympathetic to an excavator hire company whose digger comes back in need of repair, I don't think landlords deserve any sympathy either.

It’s just another risky job that involves lots of headaches, but something deserving in sympathy. All of those costs exist for reasons, you don’t have to like them, but we shouldn’t pretend that something being a landlord is like magicking money away from everyone else, it isn’t.

All of what you say is true, for some landlords. Fortunately (around the world) its not true for many of them. That said the primary focus on money in the US makes the situation there much worse.

Western society also sees home-ownershop as a primary "good thing", and positions home ownership as a goal everyone should aspire to.

In truth, a large segment of the population is better served by renting. Those that move area frequently. Those who don't have sufficient capital or income to pay for such a large asset. Those who can't get a mortgage. Those who aren't ready to make a 30 year commitment to a location. Elder folk who don't want to die with a large asset, but would rather cash-out their house and actually spend that capital.

Since most Western governments do not provide rental housing (or are slowly reducing housing stocks) - it falls to the private sector (lumped together as landlords) to provide you need.

Incidentally shortages are not the fault of landlords, but of a population growing faster than housing supply. Supply is mostly constrained directly or indirectly, by existing home owners where the primary reason against any change us "preservation of house prices in our neighbourhood". This is driven by home-owners who have been persuaded that their house is an "investment".

So you may not like landlords, and like any profession there are plenty of bad examples to hate, but the removal of rent completely as a housing option would be disastrous to a huge segment of society.

No one is suggesting the removal of rent. The solution for a higher quality of life for all involved is public housing. This is a problem that Vienna has solved.

https://www.nytimes.com/2023/05/23/magazine/vienna-social-ho...

I agree that public housing is a very good solution. However most countries have not succeeded I providing this and until that happens villifying private landlords is not helpful.

By all means advocate for social housing, an general easing of restrictions to new housing development. I'm right behind you in that.

Vilifying private landlords is helpful in advocating for public housing and denouncing Rentier Capitalism. Rather than seeking to live off the wages of others, people are better served by earning a wage themselves.

The essence of capitalism is that capital can be used to produce income. Rent, and specifically residential property rent are a tiny fraction of that.

Why it's possible to highlight the negative effects of capitalism in general, I feel like that's a "boil the ocean" problem.

The root of the housing issue is supply. It doesn't matter who owns the accommodation - there's a shortage of it - and that's driving prices up.

I more useful strategy IMO is to look at policies that would encourage all levels (private and govt) to develop more housing and increase the supply.

The shortage you mention, do you think it would exist or exist in as significant a degree if landlords were not buying properties they have no intention of occupying?

Under capitalism there's an incentive to manufacture a shortage to drive prices up. That's why Vienna has such a higher quality of life than anywhere in the US: robust public housing which does not have such a detrimental incentive.

https://www.theguardian.com/world/2022/jun/23/vienna-reclaim...

I think its important to distinguish the types of landlords. I rent my house, and the owner is just an old couple across the street. Those two are not part of the problem.

Now the property management company doing the lease paperwork for the couple, now they are part of the problem.

If the landlord wasn’t part of the problem, they wouldn’t wouldn’t be delegating management to a management firm that is (there may or may not be management firms that aren’t, but there are definitely landlords that manage properties themselves that aren’t.)

your landlord across the street isnt the strongest counterargument actually

those are the local forces gambling on the highest possible rent - which they could have done anytime whether richer people were in town or not - , and attention should be directed at them to alleviate price pressures

>> attention should be directed at them to alleviate price pressures

Why is that the responsibility of small landlords who rent out a spare bedroom or second house? That's like saying it should be on independent gas stations to alleviate high oil prices.

Its not the responsibility, its an observation that they are more susceptible to peer pressure while having been largely overlooked as a contributor to housing price pressure

>> more susceptible to peer pressure

This implies that one should pressure people to the degree that you can pressure them, rather than to the degree that they're in the wrong. Which is pretty unjust.

I'm not familiar with that reading of it, and I have no opinion on the existence of that side effect.

My observation is that they have an outsized influence on housing price pressure, while they currently fly under the radar from local disdain about the influences on housing price pressure.

Individual landlords can be moral, upstanding people, and the incentive structure around deriving your income from rents can systemically produce inhumane outcomes. They are not mutually exclusive.

>> the incentive structure around deriving your income from rents can systemically produce inhumane outcomes

It's also the only thing that produces new construction. Properly regulated and harnessed, the incentives are necessary to draw capital to building.

Exactly! And also the rest of the benefits of speculation apply to housing just as much as anything https://en.wikipedia.org/wiki/Speculation#Economic_benefits

Namely, real estate investors provide liquidity to the market, bringing price stability and absorbing risk from developers and homeowners.

From that same section, though:

> On the other hand, as more speculators participate in a market, underlying real demand and supply can diminish compared to trading volume, and prices may become distorted.[8]

Note that I said "properly regulated and harnessed". The creation of bubbles is a temptation for both speculators and governments.

Specifically, derivatives and futures based on real estate should be treated by governments as toxic / illegal speculation. In fact, banning bad money from bubble-making practices amplifies the incentive for small landlords to improve and build living space on property.

Yup. Your comment seemed to present advantages of speculation without saying it’s a pure good. The comment I replied to seemed more pure market.

> It's also the only thing that produces new construction

It's not, though. People constructed housing for thousands of years without landlords. There are plenty of ways to fund constructions without markets. We have built a society that prefers to organize it that way, but that is also a society with more vacant units than there are homeless, where it is _normal_ to spend 50% or more of one's income on rent. Those outcomes, I argue, are inhumane, but also, maybe more controversially, avoidable in a system organized around something other than profit.

I'm just starting being a landlord and I am one bad tenant away from copying the inhumane practices associated with companies that deal with a plethora of bad tenants. I purchase my home last year and I am renting below cost.

If everyone behaves nicely, it works out well for everyone. But if a party doesn't follow the agreement, everyone is in for a world of hurt.

Single unit landlord here. There are slumlords who do the bare minimum and then there are the good ones that try to do everything they can to make the experience enjoyable. I fix things asap, I am super understandable about late rent, I am the landlord I would want if I was renting from me.

I am living abroad and wanted to keep my home in case we returned. Also home purchasing is out of the question for most folks and renting offers a low up front cost to getting into a home.

Let’s not paint all landlords with the same brush. Some are hardened speculators and some of us are just middle-class folks mom and pops.

And the same goes for rentees, especially with some of the covid exceptions that were put into place.

"Walk a mile in someone else's shoes"

I suggest you try being a landlord before proclaiming judgement, even as a thought experiment. Find a property you might purchase (with a mortgage) to rent out. Calculate the cost/liability. Look up the renting laws in your area. Look up the market price for renting. Look up maintenance costs and schedules. Estimate time spent interviewing, handling paperwork and accounting, scheduling maintenance. Calculate net profit.

It is not useful to individualize this. Even if you could make a solid argument that being a landlord might sometimes take more effort than working a job does for someone else to pay your mortgage for you, corporations holding many properties at once (with just a couple of companies holding up to 5% of the rental stock) are going to have a bigger economic impact on the market, and the small-time landlord's experience isn't really relevant to that, vis effort, risk, or graciousness to their lessees.

Somewhere on Reddit there was a landlord who rented to a couple. 2bd. Couple broke up before moving in. Landlord stated he'd expect one of the remaining people to find a roommate.

How miserable must you be that you literally force random people to live together.

Just rip up the contract.

Therein lies the common, two-faced landlord. "It's just business" when they are exercising what they view as their rights as a landlord; "Won't somebody think of us poor, hardworking, regular people?" the moment things turn on them.

>there are few "professions" lower than landlord in my book.

Spoken like the classic redditor who had no idea the kind of work goes into being a landlord.

Maybe you should consider how much work goes into being an average landlord and avoid categorizing all property owners as predatory capitalists. Or you could continue lumping the 95% in with the 5% for internet points, if that kind of thing fits you better.

Oh yeah, I see the results of my landlord's hard work every day.

I'm sure you do. If it wasn't for your landlord, your apartment wouldn't be available for rent

lmao.

What horror that it might be on the market to be bought as an owner-occupied residence instead.

When people justify landlords as providing housing, it always seems to be without consideration to the particular financing/market circumstances that make "buying a house" something that is difficult for a lot of people these days, a thing that was not true not even that long ago (and did not become true due to simply neutral market fluctuations).

Yes, my tenants certainly do. Thanks for the support.

I expect when the system makes the screws tight enough, of ever increasing rent costs and food prices, with an entire army of executives dedicated to keeping wages low, in a country of massive gun ownership, something will snap and well find out exactly what the distribution of predatory capitalists vs responsible property owners is.

landlords don't work they extract rent. nothing of value is provided, only taken from those who do work bc they have to have a roof over their heads. the maintenance and other work that goes into a property is work separate from being a landlord. any tenant can do maintenance themselves or contract it out, I don't need a landlord for that

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