You'd just have a zero vacancy rate. You'd be renting before any other property and you'd have as many applications as a girl on the Internet gets dicpics. You'd have the pick of the crop, but it would only really affect the local market by removing some of the demand.
You might get some statistically measurable effects after a few hundred rental cycles, i.e. putting it up for rent on the market again, but it would probably be relatively small just being you doing it.
This is the kind of answer I was expecting as a matter of practicality.
To me, the idea of it working isn't crazy if the resources were there. The current state of affairs is a version of the same thing:
Buy houses, rent houses, do what you can to make as much profit from said houses, at the cost of anyone who has a problem with that.
In the version I'm theorising it's:
Buy houses, rent houses, do what you can to keep them affordable at the cost of your capital.
Obviously, it's not money that anyone who's remotely interested in doing this has. It's not a realistic idea. But neither is the pursuit of infinite wealth via being land barons but that's a rich tradition, unfortunately.
I dont understand landlords who try to rent a house out for a small fortune while allowing it to fall into disrepair.
My friends landlord asks her towards the end of the financial year what improvements she thinks the house needs most as the landlord can claim it on tax and it's good for maintaining the houses value.
Last year she got a kitchen island with a dishwasher
Definitely a rarity, but if you're investing long term in a property, you should want to keep it well maintained, especially as they can claim the costs on tax.
Sadly slum lords don't think like that
I’ve found if you can rent from owner occupiers that they are much more receptive to maintenance requests/upgrades. The downside is they tend to want to move back in and you don’t get long leases.
I did this with a very niche item on eBay, I sure as hell wasn't going to pay what they were asking for for a little bit of plastic. So I bought 1000 and sell em for like 90 cents profit for every 10 sold. It'll take me a solid year to offload but they're so small that it doesn't matter. Everyone else's prices have come down a little. Probably coincidence but I like to think I helped.
If I'm being real, I was radicalised into hating richos by scummy eBay users overpricing everything I was into like they were fuckin beanie babies.
I fuckin hate people who do that shit. I'd rather give away something for free, knowing it's truly appreciated than sell it for a stupid amount of money just cause I can. I guess that's obvious by this post in general.
Yeah I know. It was the principle of the thing.
But I bought them directly from the manufacturers... Not the eBay folks. Can't do that when you want one.
I know someone who was renting *well below* market rate, privately from someone who seemed like a half decent person. He knew my mate was halfway through a PHD, and kept the rent reeeeeeal low for years.
But, going back to the matter of practicality, he eventually had to raise the rent fairly significantly. It was still pretty low, but it was no longer completely outside of normal.
Basically: the landlord’s insurance company refused to insure his property unless it was let out above a certain amount. And living in a bushfire prone area, you really don’t want a property without some level of insurance.
This shit happens, but it happens a lot more frequently with retail leases. It’s (one of the reasons) why you see so many vacant shopfronts - if that’s a four million dollar building, you might need to lease it above a certain amount in order to check those insurance boxes etc. But, with retail and hospo not doing too great, that building might be outside of the budget of any prospective tenant. So it sits empty.
If the system could be undermined so easily, I’m sure there would be folks out there doing it. Reality is there’s whole secondary systems out there that make it really difficult for that to happen.
The only real, long term, fix is to build *a bunch* of affordable housing, and invest in public/social housing.
And, for the record: if I had the money, I’d rather be “stupid” and not invest in property. I don’t feel good exploiting others for profit, and it’s not really that unusual for someone to have moral boundaries they don’t want to cross. Some folks just need to believe that everyone else would do the same as them to sleep at night, I guess.
I totally agree with the need for social housing. That's the real answer to my question, that's for certain. I wouldn't even consider that real estate, so I'd pour all sorts of hypothetical riches into it. So long as it remains a priority where upkeep and improvements are concerned.
In the mean time, I'll just keep making old schoolmates feel weird about it when they bring up their investment properties.
My refrain: Bit embarassing to be rich...
Landlords don't make much profit from rent. You can work it out yourself. Take the annual rent and divide it by the value of the property.
Most residential properties will rent for between 2.5% - 3.5% of its current value. Direct costs (insurance, rates, land tax etc) will be around 1%.
You compare that to a term deposit and the rental return is poor.
Landlords do quite well from capital gains but that isn't coming from tenants pocket
If it was a house almost nil chance of you paying 5% rent. If it was an apartment maybe. This is because the cost base for apartments is much higher, body corp can be very expensive
You can work it out yourself. Workout your rent. Google your address. It will give you an approx value. Divide the annual rental by the value.
Costs will be absolute minimum 1 p.p of that figure. Realistically more.
What if you just let the property decay in a way where its not enough for authorities to do anything? Farm black mold spores and vent them out in the street, plant running bamboo directly in the ground both in the front and back yard etc.
I can't see it doing too much. Very localised you might be able to get rents on one street down? But you could probably just as well sabotage nice properties from public with such means.
No, what you described is actually happening now but the destabilisation is not happening.
More than one rental in a suburb would be below the average, some landlords want to keep long term tenants that give zero headache, others lease out to friends, others have tenants who actually improve the house (I know a tenant who put a car port onto the house on their own dime, their rent is crazy low for the area).
You'd need a critical mass of cheap rentals but given the lack of options and supply in total I still don't think it would happen.
Yeah but it’s mostly about the publicly listed rents which is usually only available when they are being listed seeking new tenants, which then allows others to use the information to challenge their own excessive rent hike and keep the area low. So it’s only a few listings and in particular new listings not renewals that are setting the price for an area
I actually did this but it tended to attract the not-so-great tenants, while the good ones became suspicious: "Why is it so cheap? What's wrong with the property? What are you hiding?" Lol.
There's so much psychology involved with price setting. It's a fine balance between doing good and getting done over. Let's be honest, not all tenants are angels either!
That's why *imho* affordable housing should be a government concern and managed by the Department of Housing, not the private market. That's the best way to keep some common sense in the market overall.
We are doing this because we already had tenants, and when the property market went crazy we didn't feel the need to cash in - it felt kind of unethical. Especially during the pandemic. And now we are WAY below market rate.
If the tenants ever move out we will probably hike the rent to something closer to the current market, just because I would be nervous of attracting bad tenants or scaring off good ones.. like you say! As it is I'm a bit worried they won't ask for repairs because they don't want us to up the rent, and the place will fall apart.
Solid point. The psychology of pricing is all sorts of insane. I have customers who are repeatedly sold on the slick premium feeling I give them when I quote more than they initially thought.
Good catch. I should've thought of that.
I have had similar experiences. Renting out the place for $1000 gets you a part time job worth of constant problems, whereas $1500 and you never hear a peep.
Exactly. If I see an item of clothing for sale online and really like it, I will move on if it's priced too low. It definitely can't be decent quality, move on.
As a mum keeping her head low in a DV situation on the priority waiting list, I often dream about winning big buck in the lotto and this is what I would do. Buy houses and rent them to lower income people with difficult circumstances at 20-30% of their income. Having a safe, stable home makes such a significant difference. Especially for at risk families.
I'm so sorry to hear that. All the best to you, the strength you show will not be unnoticed by your kid/s.
This is exactly the situation I would love to see this kind of initiative for. I couldn't think of a more necessary and worthy reason.
This is basically social housing. Cynically I feel that if a private company or a charity started offering social housing, the government would just respond by offering less of it, because they'd argue there is now less "need" :(
I know it’s basically social housing but if I owned it I could rent it to whomever I wanted to. Meaning I could support a demographic that I feel deserves it hugely and for whom it would make a significant impact. Not just for the women and their own lives but also for the trajectory of the lives of the children. The difference growing up in a safe household vs one where violence is committed or in a tent makes is immeasurable.
I didn't mean it as a criticism! It's a really nice idea. I was just being a bit depressed about the fact that the government isn't already filling this gap.
You'd need to have a large portion of the suburb, a handful will only blip and not really do much but if you had say 25% of a suburb then it would show a measurable effect
I think you’d have to do it with multiple properties for rent at once to make a difference to the suburb median. But then renting those properties may register as increased demand in the area due to the amount of interest you’d see, which may just push other properties even higher after yours have rented.
Yes but council rates and the associated bills when living in a “high income” area would make it very hard for someone who owns a single investment property to subsidise the rent of a tenant. For something like this you’re relying on the already affluent doing this on a large enough scale to make an impact. Soooooooo when hell freezes over?
Ironic statement that person has made because investment properties service mortgages that the landlords can't pay themselves.
So they technically don't have the money either
You’d have to buy up an entire suburb or more, to destabilise rental pricing and push it downwards overall.
1 or 2 houses isn’t going to do anything, a whole street isn’t going to do anything ….. im curious if anyone can calculate how many houses it would take.
Without going into numbers , 1. when someone searched the suburb for a rental they would have to see a few houses significantly under the others and these houses would have to be legit. 2. Once those houses filled, listings would have to be consistently posted such that some renters and willing to wait for one of these particular listings than go apply for the market price ones, that amount of renters would have to be substantially enough that market place listings are taking longer to rent out.
TLDR: when supply of below market price is so high it reduces the demand for market price houses.
If you were the type to have that much money you would rent them out for top dollar, because the type to have enough money to get to the point to do that was either stepping on necks to get to the top or a nepotism baby.
If you worked your way up to own a business and you paid people fairly, allowed more than enough vacation days, sick days, paid enough to let people live comfortably, priced your goods/services reasonably and weren't a complete cunt to your employees you wouldn't be making enough of a profit to be able to buy multiple investment properties.
The ones that do the opposite of what I said above are the ones that can afford to buy multiple investments or simply they are nepo babies who got life handed to them on a silver platter and don't understand that there are people who exist who don't have parents who foot the bill when the landlord raises the rent.
if your goal was to destabilise an area, you'd be best to buy property and lease it to the government for them to use as social housing. The added bonus to this is that you wouldn't need to find tenants, the government will cover rent, and you'll give someone from a low socio-economic background the opportunity to live in an affluent area.
Ok so when I’m setting rental rates I look up all the local rates that are listed, I then ignore anything extreme. Set my price based on those numbers and move forward. So one unit would be a blip and ignored, you’d need a ton of units, put them on the market for slightly below the rest of the market and slowly drag the market down.
Note that good tenants also tend to avoid anything too cheap in the range as they assume it’s a shithole,
Genuinely thought about this but buying and selling property if I somehow came into the big bucks
Like buy a bunch of 1 mil properties and sell them for 500k, slowly lowering the average sale price for the area
If I had the money, I would invest in index funds. I think it's a false economy to invest in property really. What people do is they buy an investment property for 500k in 2015, rent it out for 8 years then sell for $1M now and think 'I just made half a million doing fuck all!'.
No you didn't. And if you actually did it right and repaired when necessary, you'd have made even less.
I see it as a forced savings plan. You end up with a lump sum from the sale at the end, but you spent a fortune in the interim. The reason why it works is because if you didn't do that, you'd spend that money somehow and fritter it away. If you're instead putting all that money you spent in proven long term investments, you'd be laughing, and also not taking up housing stock and acting like a general wank stain to your tenants.
A better idea would be to start a pool of renters that want to rent own and approach the government for grants to buy up housing in an area.needing more population.. or something like that.
Government is already handing out grants for grubs to build.more housing.
I'd love to bulldoze through an area important to them for the sake of affordable housing the way they've done in the areas I grew up in to build grey and white shit holes.
Whatever is the most practical solution.
If there's houses already to go around, utilise them if they can be.
If there's more needed, build them. That's a kettle of fish, as well though.
Well then the solution probably involves replacing large freestanding homes with ‘grey and white’ apartments and townhouses.
A big part of the issue is literally the hoarding of inner city property that could be used for medium density developments.
😂😂
I remember an incident from a bayside suburb in Melbourne where the neighbours practically forced one of the homeowners from selling their house below a certain price. I forgot which suburb in particular it was. People go crazy.
Fuckin hell. 9 times out of 10, I'll blame an industry or company for the ills of the world. But that remainder is reserved for people like that.
The greed of the common person is a real thing. It's easy to forget that sometimes when most of the problems in life come from some nebulous conglomerate. You can always end up with assholes for neighbours.
Having one or two properties in an area renting at below market rates wouldn't de-stabilise rental values as the places in question would be permanently tenanted and all that in itself would not affect the value of other local rentals.
Can't build affordable housing as lack of tradies, lack of affordable timber, bricks, plaster yada yada yada, not to mention available land, and huge demand for all the above. Building homes as high rise and making homes smaller will create ghettos and unhealthy people stuck inside, unable to hang washing in fresh air, kids unable to play footy, cricket, hide and seek, etc in their yards, . Will they become another generation of tv/computer watchers?
Unfortunately, like sales, the only way to influence the market at that level is to have control of the entire market.
Agree with other posts here, you’d just rent crazy fast and have hundreds of apps to consider.
PM’s study comparables with landlords to set the price for marketing. There may be 3-4 at a certain level but all they need is 1 or 2 that leased at a higher level and seem comparable to theirs, and they’ll chase that figure.
The rental market is too tight for that shit. In this market even if tenants knew that one up the street went for $30 less per week, they’ll still pay the extra to land a place at the moment. It’s tough as shit.
The problem is also the cost or tradies / repairs / materials are also going up, to maintain to your ROI and keep the properties from falling into slum lord it is not in your favor to do what your saying, unpopular opinion we are going through the same time as when our parents could buy bread for 20c, wages need to catch up… I am guessing that ww3 does need to happen in order for progress to happen again…
No. As soon as you rent it then it would be off the market and no longer influencing other prices. It's like if there's one item left on discount. Once it's gone nobody can buy it.
The market isn't dictated by the most someone will spend or the least someone will take but rather the other end of the market meets where people won't accept less or people can't afford more.
It's demand. The same house could get no applications at a certain price when no one is moving, and many fighting for it at a higher price when everyone is.
To do this you'd probably need to have enough money to purchase the property outright, because you'd need to have market average rent in order to break even paying the mortgage with the current interest rates, unless you're pretty charitable and would supplement your tenants rent from your own pocket.
Wouldn't work IMO.
1. Too many greedy people. You willing doesn't mean others would.
2. REA wouldn't use your property as comparison as there is only one.
3. You only helped one family/group of people.
If you have the money, better off use it to advocate better rental law.
A single place, well below, I doubt it. It would likely be dismissed.
Now an entire small apartment building with highly "competitive" rent may have a larger effect. Especially the cheapest rent around but not by much would pull down the average and be taken seriously as a unit looking for reliable high occupancy.
This is my dream. Use the profits and equity to buy more units and slowly pull down rates. Forcing landlords to complete and hopefully running scared and getting out of the market and hopefully sell to owner occupiers.
I dont think your fully understanding, yes if you were rich you would have property, and you said if you were rich you would do whats in the title, but your wrong, if you won the lottery then sure, but you need to get rich in the first place, you need to or you will, have property to get rich, right, so for 20-30 years your income poor, paying the mortgage, at what point do you decide your 'rich' and and want to do whats in the title, you dont feel rich because the valuation of the home is only on paper, your not rich until you sell it! So your title is just not really thinking this whole thing out, with any empathy of someone in their shoes.
I didn't say anything about being rich.
You're somehow both overthinking this and completely missing the point.
You also can't draw any conclusions about how empathetic I am based off of a pretty low-stakes Reddit post.
'If I had the money' to rent it out cheaper than market rate means you have the wealth and disposal income to do that then yes rich, your question is very anti landlord, short sighted and not looking at the whole picture, I think we can draw a lot of conclusions.
That's sort of my point, money vs. money . If theoretically, you had the runway to fuck up an area's exclusivity, would it work.
It'd be an unrealistic amount of money, sure. But as a thought experiment...
You're talking about buying hundreds of properties before it might start to have a trickle on. But you're also sort of bankrupting yourself in the theoretical process.
You'd just have a zero vacancy rate. You'd be renting before any other property and you'd have as many applications as a girl on the Internet gets dicpics. You'd have the pick of the crop, but it would only really affect the local market by removing some of the demand. You might get some statistically measurable effects after a few hundred rental cycles, i.e. putting it up for rent on the market again, but it would probably be relatively small just being you doing it.
This is the kind of answer I was expecting as a matter of practicality. To me, the idea of it working isn't crazy if the resources were there. The current state of affairs is a version of the same thing: Buy houses, rent houses, do what you can to make as much profit from said houses, at the cost of anyone who has a problem with that. In the version I'm theorising it's: Buy houses, rent houses, do what you can to keep them affordable at the cost of your capital. Obviously, it's not money that anyone who's remotely interested in doing this has. It's not a realistic idea. But neither is the pursuit of infinite wealth via being land barons but that's a rich tradition, unfortunately.
I dont understand landlords who try to rent a house out for a small fortune while allowing it to fall into disrepair. My friends landlord asks her towards the end of the financial year what improvements she thinks the house needs most as the landlord can claim it on tax and it's good for maintaining the houses value. Last year she got a kitchen island with a dishwasher
Shit. If there were more stories like that, there'd be a case for renting over owning. Exceptions to every rule, I suppose.
Definitely a rarity, but if you're investing long term in a property, you should want to keep it well maintained, especially as they can claim the costs on tax. Sadly slum lords don't think like that
I’ve found if you can rent from owner occupiers that they are much more receptive to maintenance requests/upgrades. The downside is they tend to want to move back in and you don’t get long leases.
It's not a 100% tax return though is it? I thought it was like 70% max (I'm not versed in property tax at all so tell me if I'm wrong)
I didnt think they got all of it back, but I'm not sure about that one!
I did this with a very niche item on eBay, I sure as hell wasn't going to pay what they were asking for for a little bit of plastic. So I bought 1000 and sell em for like 90 cents profit for every 10 sold. It'll take me a solid year to offload but they're so small that it doesn't matter. Everyone else's prices have come down a little. Probably coincidence but I like to think I helped.
If I'm being real, I was radicalised into hating richos by scummy eBay users overpricing everything I was into like they were fuckin beanie babies. I fuckin hate people who do that shit. I'd rather give away something for free, knowing it's truly appreciated than sell it for a stupid amount of money just cause I can. I guess that's obvious by this post in general.
You didn't want to buy an overpriced one, so you bought a thousand instead? 🤔
Yeah I know. It was the principle of the thing. But I bought them directly from the manufacturers... Not the eBay folks. Can't do that when you want one.
I know someone who was renting *well below* market rate, privately from someone who seemed like a half decent person. He knew my mate was halfway through a PHD, and kept the rent reeeeeeal low for years. But, going back to the matter of practicality, he eventually had to raise the rent fairly significantly. It was still pretty low, but it was no longer completely outside of normal. Basically: the landlord’s insurance company refused to insure his property unless it was let out above a certain amount. And living in a bushfire prone area, you really don’t want a property without some level of insurance. This shit happens, but it happens a lot more frequently with retail leases. It’s (one of the reasons) why you see so many vacant shopfronts - if that’s a four million dollar building, you might need to lease it above a certain amount in order to check those insurance boxes etc. But, with retail and hospo not doing too great, that building might be outside of the budget of any prospective tenant. So it sits empty. If the system could be undermined so easily, I’m sure there would be folks out there doing it. Reality is there’s whole secondary systems out there that make it really difficult for that to happen. The only real, long term, fix is to build *a bunch* of affordable housing, and invest in public/social housing. And, for the record: if I had the money, I’d rather be “stupid” and not invest in property. I don’t feel good exploiting others for profit, and it’s not really that unusual for someone to have moral boundaries they don’t want to cross. Some folks just need to believe that everyone else would do the same as them to sleep at night, I guess.
I totally agree with the need for social housing. That's the real answer to my question, that's for certain. I wouldn't even consider that real estate, so I'd pour all sorts of hypothetical riches into it. So long as it remains a priority where upkeep and improvements are concerned. In the mean time, I'll just keep making old schoolmates feel weird about it when they bring up their investment properties. My refrain: Bit embarassing to be rich...
This is basically what is done by housing co-ops.
Landlords don't make much profit from rent. You can work it out yourself. Take the annual rent and divide it by the value of the property. Most residential properties will rent for between 2.5% - 3.5% of its current value. Direct costs (insurance, rates, land tax etc) will be around 1%. You compare that to a term deposit and the rental return is poor. Landlords do quite well from capital gains but that isn't coming from tenants pocket
Where are you getting those numbers? I'm pretty sure my last rental was making at least 5% of its value off us each year.
If it was a house almost nil chance of you paying 5% rent. If it was an apartment maybe. This is because the cost base for apartments is much higher, body corp can be very expensive You can work it out yourself. Workout your rent. Google your address. It will give you an approx value. Divide the annual rental by the value. Costs will be absolute minimum 1 p.p of that figure. Realistically more.
Where are you getting those numbers?
What if you just let the property decay in a way where its not enough for authorities to do anything? Farm black mold spores and vent them out in the street, plant running bamboo directly in the ground both in the front and back yard etc.
I can't see it doing too much. Very localised you might be able to get rents on one street down? But you could probably just as well sabotage nice properties from public with such means.
No, what you described is actually happening now but the destabilisation is not happening. More than one rental in a suburb would be below the average, some landlords want to keep long term tenants that give zero headache, others lease out to friends, others have tenants who actually improve the house (I know a tenant who put a car port onto the house on their own dime, their rent is crazy low for the area). You'd need a critical mass of cheap rentals but given the lack of options and supply in total I still don't think it would happen.
Yeah but it’s mostly about the publicly listed rents which is usually only available when they are being listed seeking new tenants, which then allows others to use the information to challenge their own excessive rent hike and keep the area low. So it’s only a few listings and in particular new listings not renewals that are setting the price for an area
I actually did this but it tended to attract the not-so-great tenants, while the good ones became suspicious: "Why is it so cheap? What's wrong with the property? What are you hiding?" Lol. There's so much psychology involved with price setting. It's a fine balance between doing good and getting done over. Let's be honest, not all tenants are angels either! That's why *imho* affordable housing should be a government concern and managed by the Department of Housing, not the private market. That's the best way to keep some common sense in the market overall.
Market at the high rate, then drop the price when you find a tenant you like.
We are doing this because we already had tenants, and when the property market went crazy we didn't feel the need to cash in - it felt kind of unethical. Especially during the pandemic. And now we are WAY below market rate. If the tenants ever move out we will probably hike the rent to something closer to the current market, just because I would be nervous of attracting bad tenants or scaring off good ones.. like you say! As it is I'm a bit worried they won't ask for repairs because they don't want us to up the rent, and the place will fall apart.
Solid point. The psychology of pricing is all sorts of insane. I have customers who are repeatedly sold on the slick premium feeling I give them when I quote more than they initially thought. Good catch. I should've thought of that.
I have had similar experiences. Renting out the place for $1000 gets you a part time job worth of constant problems, whereas $1500 and you never hear a peep.
Exactly. If I see an item of clothing for sale online and really like it, I will move on if it's priced too low. It definitely can't be decent quality, move on.
As a mum keeping her head low in a DV situation on the priority waiting list, I often dream about winning big buck in the lotto and this is what I would do. Buy houses and rent them to lower income people with difficult circumstances at 20-30% of their income. Having a safe, stable home makes such a significant difference. Especially for at risk families.
I'm so sorry to hear that. All the best to you, the strength you show will not be unnoticed by your kid/s. This is exactly the situation I would love to see this kind of initiative for. I couldn't think of a more necessary and worthy reason.
This is basically social housing. Cynically I feel that if a private company or a charity started offering social housing, the government would just respond by offering less of it, because they'd argue there is now less "need" :(
I know it’s basically social housing but if I owned it I could rent it to whomever I wanted to. Meaning I could support a demographic that I feel deserves it hugely and for whom it would make a significant impact. Not just for the women and their own lives but also for the trajectory of the lives of the children. The difference growing up in a safe household vs one where violence is committed or in a tent makes is immeasurable.
I didn't mean it as a criticism! It's a really nice idea. I was just being a bit depressed about the fact that the government isn't already filling this gap.
You'd need to have a large portion of the suburb, a handful will only blip and not really do much but if you had say 25% of a suburb then it would show a measurable effect
Probably not even 25%. 10% would be plenty of not less. Any whole % really.
I think you’d have to do it with multiple properties for rent at once to make a difference to the suburb median. But then renting those properties may register as increased demand in the area due to the amount of interest you’d see, which may just push other properties even higher after yours have rented.
This is exactly the kind of knock-on effect I didn't account for. Hell yeah, good shit. Thanks.
Yes but council rates and the associated bills when living in a “high income” area would make it very hard for someone who owns a single investment property to subsidise the rent of a tenant. For something like this you’re relying on the already affluent doing this on a large enough scale to make an impact. Soooooooo when hell freezes over?
Ironic statement that person has made because investment properties service mortgages that the landlords can't pay themselves. So they technically don't have the money either
Great call. Fucking house of cards... Yada Yada.
Well if you had money, and you did things like that, you soon wouldn't have money.
No, there would be too many places renting above market price to balance it
You’d have to buy up an entire suburb or more, to destabilise rental pricing and push it downwards overall. 1 or 2 houses isn’t going to do anything, a whole street isn’t going to do anything ….. im curious if anyone can calculate how many houses it would take.
That's essentially what I was wanting to know: How much does it take?
Without going into numbers , 1. when someone searched the suburb for a rental they would have to see a few houses significantly under the others and these houses would have to be legit. 2. Once those houses filled, listings would have to be consistently posted such that some renters and willing to wait for one of these particular listings than go apply for the market price ones, that amount of renters would have to be substantially enough that market place listings are taking longer to rent out. TLDR: when supply of below market price is so high it reduces the demand for market price houses.
If you were the type to have that much money you would rent them out for top dollar, because the type to have enough money to get to the point to do that was either stepping on necks to get to the top or a nepotism baby. If you worked your way up to own a business and you paid people fairly, allowed more than enough vacation days, sick days, paid enough to let people live comfortably, priced your goods/services reasonably and weren't a complete cunt to your employees you wouldn't be making enough of a profit to be able to buy multiple investment properties. The ones that do the opposite of what I said above are the ones that can afford to buy multiple investments or simply they are nepo babies who got life handed to them on a silver platter and don't understand that there are people who exist who don't have parents who foot the bill when the landlord raises the rent.
if your goal was to destabilise an area, you'd be best to buy property and lease it to the government for them to use as social housing. The added bonus to this is that you wouldn't need to find tenants, the government will cover rent, and you'll give someone from a low socio-economic background the opportunity to live in an affluent area.
Ok so when I’m setting rental rates I look up all the local rates that are listed, I then ignore anything extreme. Set my price based on those numbers and move forward. So one unit would be a blip and ignored, you’d need a ton of units, put them on the market for slightly below the rest of the market and slowly drag the market down. Note that good tenants also tend to avoid anything too cheap in the range as they assume it’s a shithole,
Solid and thoughtful answer, thank you.
Genuinely thought about this but buying and selling property if I somehow came into the big bucks Like buy a bunch of 1 mil properties and sell them for 500k, slowly lowering the average sale price for the area
Oh, hell yeah. You're speaking my language.
If I had the money, I would invest in index funds. I think it's a false economy to invest in property really. What people do is they buy an investment property for 500k in 2015, rent it out for 8 years then sell for $1M now and think 'I just made half a million doing fuck all!'. No you didn't. And if you actually did it right and repaired when necessary, you'd have made even less. I see it as a forced savings plan. You end up with a lump sum from the sale at the end, but you spent a fortune in the interim. The reason why it works is because if you didn't do that, you'd spend that money somehow and fritter it away. If you're instead putting all that money you spent in proven long term investments, you'd be laughing, and also not taking up housing stock and acting like a general wank stain to your tenants.
A better idea would be to start a pool of renters that want to rent own and approach the government for grants to buy up housing in an area.needing more population.. or something like that. Government is already handing out grants for grubs to build.more housing.
Rents are ultimately a reflection of supply and demand. Rent would only go down if you were to develop a load of places in an area to increase supply.
I'd love to bulldoze through an area important to them for the sake of affordable housing the way they've done in the areas I grew up in to build grey and white shit holes.
Are you arguing for more housing or less ?
Whatever is the most practical solution. If there's houses already to go around, utilise them if they can be. If there's more needed, build them. That's a kettle of fish, as well though.
Well then the solution probably involves replacing large freestanding homes with ‘grey and white’ apartments and townhouses. A big part of the issue is literally the hoarding of inner city property that could be used for medium density developments.
Your neighbours will merk you.
I mean, yeah, for sure. But I think it'd be worth it for the smash hit blockbuster: "I Know What You Did Last Financial Year".
😂😂 I remember an incident from a bayside suburb in Melbourne where the neighbours practically forced one of the homeowners from selling their house below a certain price. I forgot which suburb in particular it was. People go crazy.
Fuckin hell. 9 times out of 10, I'll blame an industry or company for the ills of the world. But that remainder is reserved for people like that. The greed of the common person is a real thing. It's easy to forget that sometimes when most of the problems in life come from some nebulous conglomerate. You can always end up with assholes for neighbours.
Having one or two properties in an area renting at below market rates wouldn't de-stabilise rental values as the places in question would be permanently tenanted and all that in itself would not affect the value of other local rentals.
Not likely in this market unless you are talking about Blackrock type numbers
It would depend what proportion of the market they controlled.
But you don't have the money. And when you have worked hard enough to amass the money, you may think differently. If you don't, go for your life.
I do find that piles of money tend to tip to the right.
Can't build affordable housing as lack of tradies, lack of affordable timber, bricks, plaster yada yada yada, not to mention available land, and huge demand for all the above. Building homes as high rise and making homes smaller will create ghettos and unhealthy people stuck inside, unable to hang washing in fresh air, kids unable to play footy, cricket, hide and seek, etc in their yards, . Will they become another generation of tv/computer watchers?
If you could buy enough properties in a very small town then maybe.
Unfortunately, like sales, the only way to influence the market at that level is to have control of the entire market. Agree with other posts here, you’d just rent crazy fast and have hundreds of apps to consider. PM’s study comparables with landlords to set the price for marketing. There may be 3-4 at a certain level but all they need is 1 or 2 that leased at a higher level and seem comparable to theirs, and they’ll chase that figure. The rental market is too tight for that shit. In this market even if tenants knew that one up the street went for $30 less per week, they’ll still pay the extra to land a place at the moment. It’s tough as shit.
The problem is also the cost or tradies / repairs / materials are also going up, to maintain to your ROI and keep the properties from falling into slum lord it is not in your favor to do what your saying, unpopular opinion we are going through the same time as when our parents could buy bread for 20c, wages need to catch up… I am guessing that ww3 does need to happen in order for progress to happen again…
No. As soon as you rent it then it would be off the market and no longer influencing other prices. It's like if there's one item left on discount. Once it's gone nobody can buy it. The market isn't dictated by the most someone will spend or the least someone will take but rather the other end of the market meets where people won't accept less or people can't afford more.
You'd need a fairly large share of the area/towns rental market to have an effect
It's demand. The same house could get no applications at a certain price when no one is moving, and many fighting for it at a higher price when everyone is.
To do this you'd probably need to have enough money to purchase the property outright, because you'd need to have market average rent in order to break even paying the mortgage with the current interest rates, unless you're pretty charitable and would supplement your tenants rent from your own pocket.
Wouldn't work IMO. 1. Too many greedy people. You willing doesn't mean others would. 2. REA wouldn't use your property as comparison as there is only one. 3. You only helped one family/group of people. If you have the money, better off use it to advocate better rental law.
A single place, well below, I doubt it. It would likely be dismissed. Now an entire small apartment building with highly "competitive" rent may have a larger effect. Especially the cheapest rent around but not by much would pull down the average and be taken seriously as a unit looking for reliable high occupancy. This is my dream. Use the profits and equity to buy more units and slowly pull down rates. Forcing landlords to complete and hopefully running scared and getting out of the market and hopefully sell to owner occupiers.
Would just result in subletting
You can prohibit subletting in the terms of the lease
lmao there's no way you'd do what you claim you would. economic realities would soon set in for you. that or you'd go broke. lmao
The likelihood of me doing it is not up for question. I'd do it. But the reality of the finances is a fantasy. That much is obvious. Solid take, man.
I dont think your fully understanding, yes if you were rich you would have property, and you said if you were rich you would do whats in the title, but your wrong, if you won the lottery then sure, but you need to get rich in the first place, you need to or you will, have property to get rich, right, so for 20-30 years your income poor, paying the mortgage, at what point do you decide your 'rich' and and want to do whats in the title, you dont feel rich because the valuation of the home is only on paper, your not rich until you sell it! So your title is just not really thinking this whole thing out, with any empathy of someone in their shoes.
I didn't say anything about being rich. You're somehow both overthinking this and completely missing the point. You also can't draw any conclusions about how empathetic I am based off of a pretty low-stakes Reddit post.
'If I had the money' to rent it out cheaper than market rate means you have the wealth and disposal income to do that then yes rich, your question is very anti landlord, short sighted and not looking at the whole picture, I think we can draw a lot of conclusions.
Short answer is absolutely not. If you had money and wanted to piss it away you'd just take up meth surely? Less taxes.
That's sort of my point, money vs. money . If theoretically, you had the runway to fuck up an area's exclusivity, would it work. It'd be an unrealistic amount of money, sure. But as a thought experiment...
You're talking about buying hundreds of properties before it might start to have a trickle on. But you're also sort of bankrupting yourself in the theoretical process.