Rents going up

[little lady]

No such reality is right…….define why you are being so ridiculous. You are just arguing and you cause you can’t accept reality.

[little lady]

No such reality is right…….define why you are being so ridiculous. You are just arguing and you cause you can’t accept reality.

[no_such_reality]

You still need to tell us what you’re looking for, if your friend has been a home owner, then she isn’t used to the rental market. She may have a bit of adjusting to do.

As for prices being up, they are all over the map. You can find plenty of inexpensive places to rent, if you don’t like them, you’ll pay more for a nicer place.

Kind of like paying more for a new car.

[surveyor]

Rental Turnover

“For him it wasn’t worth the risk of losing a tenant for even one month for only $50 extra (that’s only $600 for a 1 year lease).”

This is my point exactly! Giving up a good tenant for only $600 (for the year) and spending $2000-$3000 does not add up!

Now obviously this advice does not help if one is trying to get into a rental…

[little lady]

Ideally She wants a 2br plus, with washer and dryer and a garage. She was trying to settle for less, but it was a big adjustment, and then the plus the frustration, and she was ready to go. The place she ended up in is in El Cajon. However Clairemont to Campo was the area she looked at. She didn’t end up telling me exactly what she’d payed. But I knew it was steep, because I knew what we’d looked at and I had looked at the place she eventually got, awhile back and then it was as much as houses went for, for rent.

[no_such_reality]

Sounds like WD and garage which is a tough order as you’re basically renting someone’s townhome or older SFR.

Clairemont to El Cajon seems like a really big swing area.

Since she’s month to month, her best bet is to continue looking now, and lock a place when she finds the deal. I wouldn’t want to do that kind of search on a short timeframe.

I’m assuming she settled on a place that was fixed fairly nice? Probably put her rent around two.

That’s probably the most disconcerting for people returning to rentals is the looked of ‘used-ness’ to places. Particularly if they’ve been dealing with the immaculately dressed homes that have been selling lately.

For example, in HB, two bed-two bath places fall into the following categories:

Livable: $1200-$1400
Okay: $1400-$1600
Nice: $1600-$1800
Nice+: $1800+ (plus being dual masters, garage, etc.)

IMHO, YMMV. What I’ve found with most of the people I know as I get older is our requirement goes from Liveable to Nice or Nice+.

[PD]

It seems to be a little easier finding a rental in the winter. We were looking in January and found three good houses. We negotiated on the rent and ended up getting them to knock off $200 off of a price that had already been reduced.

[little lady]

I would say my friends place is on the nicer side, almost nice plus. It has the washer and dryer, but no garage,carport. I would gage she is paying over 1800. Because everything we saw we expected to be cheaper. If we saw an ad for one price they would say, “Well we have a 2 bedroom model comming available next month, and that one is” always 50 to 100(conservatively)dollars more than what was in the apartment guide. For this reason or that.
You figure that kinda money, you could probably get a condo conversion for sure in EL Cajon.
Not So.

[little lady]

Negociating rental increases is something you could try but
I suspect if your landlord is set on increasing there’s not much you can do. I keep noticing a couple of houses around here that have a for rent siqn up every year,to the month they had it up the year before. They are both on the same street and the amounts they rerent for is always at least 100 more than it was prior, they seem to rent fairly quickly. I always think to myself, “they must have raised the rent.” “Why would someone wanna move only after 1 year?””Why would you raise the rent every year if you have good tennants?” Is it greed?

[VCJIM]

I just received a letter from my landlord that they are increasing rent 5%; this is after two years of stable rent. In the letter, they claim their loan has increased 8%. So it seems that increasing loan amounts are being passed on to renters, at least in my case.

[PerryChase]

VCJIM, why not move and teach the landland a lesson. Can you find a nicer place for the same rent?

What does it matter if the landlord’s cost is increasing? Is that your responsibility?

[Diego Mamani]

“Our costs are going up…” Well, that’s only an excuse. A self-respecting landlord owes it to himself to get the highest rent he can. By the same token, a self-respecting tenant owes it to himself to shop around and negotiate hard for the most house he can get for his money. That’s the system.

VCJIM, by all means, try to look for another house. But you also have to consider the cost and hassle of packing, moving, and unpacking. If you do find a cheaper (or nicer/bigger place), then you can use it to bargain with your landlord. Hey, if you’re good at it you may even get your current rent reduced!!!

OTOH, if rents have actually gone up in your region, you may have to pay a bit more. But even if you agree to the full 5% increase, that’s still below inflation for the last two years. Are you in a condo, TH, or SFH?

[santeeman]

In San Jose they rose 10% last quarter, Orange County was 6.1%. I bet San Diego is next. If the median price for a rental is 2,000, which I believe it is, that could mean a 200 dollar increase for some folks. That has gotta hurt. This guy is gonna move and chances are if he pays less, he’ll get less. The landlord is just gonna rent his place to someone who will pay,occupancy is up . They can and they will. The other landlord’s who can afford to rent their property cheaper are gonna see the higher prices and price their’s up too. Next year, next quarter-I don’t know when but I am betting we’ll see it. It’s happening already, but as ARM’s reset and people either get foreclosed on and join the rental market, or put their house up for rent at astronomical prices, it’s gonna be higher.

[lendingbubblecontinues]

Let's put this to bed, once and for all. Say a guy pays $2400 rent for a nice SFR that has "current" market value of $625,000 (which would cost roughly $4272 per month using a 5/1 Option ARM, including taxes). It is costing him $22,464 less per year to live in this home by renting it than buying it. Even if his rent went up by a ridiculous 25% to $3000 per month, he would pay $15,264 LESS per year to rent the home than he would to buy it. Finally, if the value of the house were to come down (as it will…duh) to 2001 prices or cheaper in the "overshoot" of this correction, it would come down by well over $200,000. I submit to you that losing $200,000 of value in your house (or perhaps MUCH more) hurts a LOT worse than having to pony up an extra $200 bucks a month in rent as you suggest may happen. Not buying any of the argument for higher rents…I will stay out of the ownership game until both rents and home prices are suffering dramatically…likely beginning late 2007/early 2008.

[Anonymous]

Very clear, and perfectly logical, LBC. I fully agree with you.

Minor point: you may want to tax-effect the $22,464 (reduce it by approximately 20-30%) to make it an after-tax buying to after-tax renting comparison. No change in outcome, just in degree of difference.

[Author]

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