Nenshi stirs up a hornets nest with his landlord gouging comments

[ranchlandsselling]

Originally Posted by Dion

If you have a property that's mortgage free and you choose to jack rents like everyone else, I would call that gouging.

Why? How does that make any sense?

Two houses side by side, one has a $200k mortgage the other is clear title.
One should rent out for $400 less than the other?

If rental of a SFH is $2,000 per month, one should be $2,000 the other $1,600 simply because the person has no debt?

What if they bought it with cash, shouldn't they be entitled to earn a better yield on that cash than ($1,600 x 12) / cost of house?

Just a bad argument.

[Resolute 14]

Originally Posted by photon

Maybe, but is that wrong? All business is about taking advantage of someone to some degree.

http://www.cbc.ca/news/canada/calgar...ging-1.1348878

Were the business owners in this story in the wrong?

[1stLand]

That would be funny if someone made a "What I really do" Meme for Landlords.

What my friends think I do (Insert Photo)
What my mom thinks I do (Insert Photo)
What Renters think I do (Insert Photo)
What Nenshi thinks I do (Insert Photo)
What I really do (Insert photo)

[Dion]

Originally Posted by ranchlandsselling

Why? How does that make any sense?

Two houses side by side, one has a $200k mortgage the other is clear title.
One should rent out for $400 less than the other?

If rental of a SFH is $2,000 per month, one should be $2,000 the other $1,600 simply because the person has no debt?

What if they bought it with cash, shouldn't they be entitled to earn a better yield on that cash than ($1,600 x 12) / cost of house?

Just a bad argument.

Okay I see where you are coming from. It's a free market and yes landlords are free to charge what the market will bear

If I was to be clearer I would have put my comments as an ethical issue. Especially with what I have seen and heard in High River since the flood.

[Dion]

I should add that the PC governemnt to it's credit bought a condo buildng here in High River and moved the residents from the Saddlebrook flood trailers into these units. I hear it's going to be used as affordable housing in the future.

[Arya Stark]

Originally Posted by 1stLand

That would be funny if someone made a "What I really do" Meme for Landlords.

What my friends think I do (Insert Photo)
What my mom thinks I do (Insert Photo)
What Renters think I do (Insert Photo)
What Nenshi thinks I do (Insert Photo)
What I really do (Insert photo)

[Harry Lime]

I have my doubts that a lot of people are engaging in the kind of market speculation and buying of rental property now, that was happening a couple of years ago. The average condo now is being sold at a ridiculous price and the clear majority of available suites for rent were purchased at a large discount to the current amount required.

If there are a few people now who for some reason believe that the purchase of a one bedroom apartment for rental is a good idea, and sets the price at a premium to cover their cost, it shouldn't drive the rental price for all other suites on the market.

But it is.

What should ideally happen is that the person who bought a rental property now is stuck at renting it for a loss, as the market has been set by the majority of the rental suites. Everyone continues making the amount of money they were previously happy with. Their expected profit.

Instead, Calgary has a reputation of being a place where money and jobs are plentiful, and our city grows by 30K a year, putting stress on the rental market and reducing availability. This allows landlords free rein to raise prices to match the level of the first example, above.

Our city is growing too fast for the rental market to support it. Landlords are taking advantage of that fact. It's taking advantage of a unprepared for situation. Is is unethical? Maybe. Is it immoral? Sure.

[Frank MetaMusil]

So, rent freeze then?

[#-3]

Originally Posted by albertGQ

Maybe he and city council can help out a bit and stop gouging home owners with large property tax increases.

Didn't some survey this summer show that Calgary has the lowest property tax in the country?

Not saying I want to pay more.

But good government spending can have allot more impact than an individuals dollars. Say we all paid a 100 more per year, and the city found a way to use the money for infrastructure to save us all 1 minute / day commuting. That would equate to 9 hours of driving each year, or allot more than $100 / year in Gas.

[photon]

Originally Posted by Resolute 14

http://www.cbc.ca/news/canada/calgar...ging-1.1348878

Were the business owners in this story in the wrong?

Depends on how you define wrong, that's why I was asking the question. It's only a quantitative difference, not a qualitative one, which makes the line more difficult to define.

Plus a natural disaster is probably viewed differently by most people.

Originally Posted by Harry Lime

Is it immoral? Sure.

How (honest question)?

[Calgary14]

I think what Nenshi was trying to say is that landlords shouldn't take a boom in property prices as a justification to jack up rents 20-30% for no other apparent reason. He could have said it better but the message seems reasonable

[llwhiteoutll]

Originally Posted by Calgary14

I think what Nenshi was trying to say is that landlords shouldn't take a boom in property prices as a justification to jack up rents 20-30% for no other apparent reason. He could have said it better but the message seems reasonable

I'd be willing to bet that when the market corrects itself and the shoe goes back on the other foot, renters won't care if the landlord is taking a loss.

[PsYcNeT]

Originally Posted by llwhiteoutll

I'd be willing to bet that when the market corrects itself and the shoe goes back on the other foot, renters won't care if the landlord is taking a loss.

If you're a landlord and operating a technical loss (that is, you are literally spending more cash to keep the place from being boarded up than you make in equity/cash) you probably shouldn't be a landlord.

It's like people think equity isn't worth anything.

"You're paying for me to own a piece of property along with the building on it, you should be paying me more than that you horrible scrubs."

[Dion]

Originally Posted by Frank MetaMusil

So, rent freeze then?

Prentice said it's not going to happen.

[Dion]

Originally Posted by llwhiteoutll

I'd be willing to bet that when the market corrects itself and the shoe goes back on the other foot, renters won't care if the landlord is taking a loss.

Or they might think/say you made your profits for a number of years and you should have set aside funds for times like this. It's no different than workers putting money aside (rainy day funds) for possible disasters like layoffs and unemployment.

[Fighting Banana Slug]

I am getting gouged on downtown parking as a result of city policy. Discuss.

[PsYcNeT]

Originally Posted by Fighting Banana Slug

I am getting gouged on downtown parking as a result of city policy. Discuss.

Carpool or take transit or bike or hitchhike. Then yer not payin' crap.

[Mr.Coffee]

Agree with PsycNet. The difference in the 'operating at a loss' as a landlord and therefore justifying max profits when times are good, is that the principle of the landlord / tenant relationship is a home to live in. Given that shelter is a basic necessity, it does start to get outside the ethical grey area when all the rents are jacked up to unaffordable levels. I don't think anyone would argue that costs should be recouped and maybe a little profit made, but the criticism here and the key wording is gouging.

Nobody forced you to own a property and rent it at a loss even though you were in fact building equity. Similar to NHL owners, sometimes they'll operate their franchises at losses knowing that the equity from purchase to sale may outweigh the money lost year over year and they'll be in good shape.

Gouging is the problem... if it wasn't a basic necessity it may not be a problem but when housing is scarce, what people are now forced to barely afford their power bill just so they have a home to live in because you made a questionable investment decision and lost money years ago?

However, I do totally agree with the main theme of that article countering Nenshi. It is partially on the city to provide cheaper housing and not every fataing area of the city needs to be revitalized and fancy.

[Mr.Coffee]

Originally Posted by Fighting Banana Slug

I am getting gouged on downtown parking as a result of city policy. Discuss.

the difference being of course that you have city provided alternatives. Bike paths to the core, bus, CTrain... taxi...

if there are no alternatives to an affordable home because every Tom Dick and Harry is a Donald Trump, I think that's the issue.

[calgarywinning]

City services have to operate at a cost. They aren't free and the people that operate them have to earn a living. Same with City parking. These are shared community resources.

Is it to be that rental properties are that of the City to be shared? When tax rates are increased and cost of ownership of rental properties rises by the City Tax regime it's not to be passed on to the end renter with the expectation of a market rate profit for the effort?

While gouging does occur is it not the landlord that ultimately have to deal with a tenant that cannot pay or is in default for many months. Also, the market moves in sync with demand. Isn't it a gouged tenant gouging or being overpaid by what he provides to society? Shouldn't the wage be controlled along with the rent. Also, why stop there when we can control diet.

Now when we talk about the impoverished, mentally ill there is a difference. That's where we decide to come together as a society and a city and decide what our standard will be for the basic necessities. It would be my choice to look after these people as a cost for moral and ethical issues.