It's a nice idea to think human beings are strictly rational, but they aren't. We've long known, homo economicus had his funeral in the 90s. Amos Tversky murdered him in an entirely rational way.
OK, kidding aside - purely rational decisions are extremely rare.
> but at the end of the day they'll swallow their feelings
People do many things, but they very rarely swallow their feelings. If you've ever seen a neighborhood lawsuit or a divorce, you've seen feelings be extremely powerful things, even if finances are involved.
"unless a tenant is being an outrageous bastard" is the operative phrase there. Feelings color what's considered outrageous. Sometimes, "he looked at me funny" is all that's needed to make an entirely irrational decision.
There's a whole bunch of studies clearly showing that people would rather take a monetary loss than a gain where they think the other party gets an outsized gain (not at their expense) as a result in the latter case. Humans are weird. Feelings matter a lot.
One of my favorites is this one: https://www.sciencedirect.com/science/article/pii/S016726819...
One of the examples in there is a choice about pay at work
A: You make $50,000; others earn $25,000
B: You make $100,000; others earn $200,00
And a very large number of participants would rather choose A, because that means they'd be relatively better off than their colleagues. Even if they end up with half the income.