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But by all means keep saying Rent Control is the issue if it makes you feel warm. Continue to cite old studies and studies from far away locales. Beat the drum.
Plenty of fairly recent studies out there. But you carry on citing (0) studies and fallacies of logic. Whatever makes you feel all warm and fuzzy. I suppose the earth is flat too.
Last edited by bostongymjunkie; 02-19-2023 at 05:45 PM..
Found a very smart person with a lot more knowledge than me *on what will remain an unamed competitor site* to explain things far better than I could. Multi-decade commercial and residential landlord here.
You are totally right.
BUT - not all landlords are against what Wu is trying to do here. I’m in favor of it. A 10% increase cap only harms the laziest, worst landlords who shouldn’t be in the business.
I’ve never raised a returning tenant more than 10% on renewal. Usually it’s zero. Sometimes it’s a minimal $50-$100. And it’s not because I’m a nice guy who doesn’t want to make money. It’s because it’s not how you do business if you want to thrive as a landlord.
The real money to be made as a developer/landlord comes from five general things:
1. redeveloping properties to take rents from $1,000 per month to $2,800.
2. using tenant turnover as a chance to raises rents to “market” rate when you get someone with higher financial capacity.
3. over time (think decades) making huge profits due to general market conditions rising. Most of my portfolio was purchased pre-2004. Rents are triple what they were at time of purchase on most of my units. You want to operate in a market where there is a huge future upside to property and rent appreciation. Boston is where it’s at for that. And there are rising “secondary” markets like Charlotte where you can do very well. Places like Worcester and Framingham have been goldmines over the last ten years too.
4. taking advantage of a tax code that STRONGLY favors real estate pros and landlords. Beyond non-cash expenses like depreciation, beyond the 20% QBI deduction that allows you to dodge taxes on 20% of your profits, you have things like immediate write-offs for taking assets out of service when you demo or demolish a structure that can be used to offset millions of dollars of earned income.
5. being able to reduce the cost of carry substantially by recapitalizing portfolios during slow economic times. I refinanced and recapitalized my entire portfolio during COVID and took my average cost of loans from 5’s and low 4’s to loans that are anywhere from 2.75% to 3.75%.
None of Wu’s proposals change any of those levers of wealth creation that any seasoned landlord/developer uses.
What it does do it crimp lazy-ass mom and pops who buy a three-family and think it’s a get rich quick investment. And who try to exploit tenants and take advantage of the huge relocation costs (first/last/security/broker fee + cost of movers) to jack rents on captive tenants from $2,500 to $3,400 on renewal. (Why you’d ever want to squeeze someone who was only quailed for $2,500 to a much different rent tier is beyond me - and it’s a great way to start getting deadbeats and vacancy losses while you try to evict.)
TLDR: Landlords come in two forms in Boston:
1. seasoned operators who rake in money.
2. mom and pops who hire management companies, or who don’t know what they are doing, or are undercapitalized, and yet who delusionally expect their investment to beat 10-20% per year. They complain that they have to repaint a unit, they try to use security deposits for wear and tear, they don’t know how to do background screening, they buy ****ty properties that haven’t been remodeled since 1987 (that any seasoned landlord would avoid without redeveloping) and they then have the balls to complain anytime anything happens that requires they step up and actually take an interest in owning, developing, or maintaining their property.
And those second types of “landlords” can all **** right off. They are noisy lazy *******s who don’t add value. They complain about preventable problems. They have full-time day jobs and own property as some side gig that nobody asked them to take on. They think they can hit the “easy” button and capitalize on the rising fortunes of Boston while simultaneously ****ting on every attempt to keep the city moving forward to keep those rents rising and properties appreciating. They can sell their properties if they don’t like operating in one of the absolute easiest markets in the world to make a fortune in as a landlord/developer. They can buy single family homes in a “landlord friendly” state like Texas and rent to poor folks in rural areas and see how that goes.
All that said - there are legitimate concerns and arguments against how rent control often locks folks out of housing because it keeps lower income folks (or long-time tenants) in “rent controlled” units that are far below market rent. And whether rent control really serves it’s intended audience as well as it seems. Or whether Wu ought to be relaxing zoning and allowing for far denser multi family construction. Or whether Nimbys in rich burbs should **** and allow a few apartment buildings to be built. And those would all be fine to raise here, except I don’t see anything in Wu’s rent increase proposal that leads to those issues. 10% is an enormous rent increase. Nobody should have a beef with it as a cap. It won’t lead to what these lobbyists are claiming.
Last edited by BostonBornMassMade; 02-21-2023 at 09:07 AM..
So what's the policy, who benefits, who is covered, how it is it enforced, and what are the numbers?
Nobody disputes that there are a ton of greedy, entitled, otherwise talentless t-wats in this town exploiting people with a tight rental market (many of them amusingly flying under the political banner of "liberal/progressive" I might add).
The issue at hand here is whether "rent control" as it's known is the appropriate response.
It seems the proposal is about limiting how much an existing price (set by the landlord to whatever they could get a tenant to agree to) can go up each year, not setting any market rates for apartments to begin with. Thus, while this is being called rent control by the Globe, it's really just rent stabilization. Wouldn't be the first time a reporter let ignorance of terminology get in their way.
So what's the policy, who benefits, who is covered, how it is it enforced, and what are the numbers?
Nobody disputes that there are a ton of greedy, entitled, otherwise talentless t-wats in this town exploiting people with a tight rental market (many of them amusingly flying under the political banner of "liberal/progressive" I might add).
The issue at hand here is whether "rent control" as it's known is the appropriate response.
You’ve been commenting this whole time without knowing the policy?
It’s at the beginning of the thread.
NYC and DC have some form of rent controls or rent stabilization and build more per capita than Boston and have more apartments under $2000 as a % of their rental stock
Boston is a warped market. They will build regardless because building a new unit and pricing it high will make the most economical sense.
Not sure why Bostonians don’t just look at NYC and DC and choose to make only their older buildings rent controlled and not make new buildings rent controlled.
And/Or provide an incentive to large management companies or development firms to make rent controlled buildings an attractive municipally subsidized option. There’s so many ways to approach this but we can’t even get our foot in the door to talk about it before the RE guys and aspiring mega-capitalist try to shout it down with an oversimplified explanation.
Pair that with Zoning Code rewrite and we could do it.
Saying rent Control doesn’t work is like saying a public Housing doesn’t work because Cabrini Green and Pruitt-Igoe didn’t work. Well we now know how to make public housing work, as we saw with HOPEIV redevelopments like Harbor Point, Orchard Gardens and Mission Main- and all over the US. We just chose to stop funding it.
Wu is trying to make moves to tweak our zoning code and article 80 process. But BPDA’s Board is trying to stonewall her.
I don’t understand Bostonians. If you just say no to everything the mayor tries to do how does that benefit the city and the 65% of people who voted for her and her policy and the 75% of polled registered Boston voters in favor of rent control?
What is the end game? And I mean that as an ex-Bostonian. What is the goal? to keep doing what Marty Walsh did?
Boston just doesn’t seem to have the will, vision, and unity to do things NYC has already modeled for them. Like commuter train electrification, upzoning, rent stabilization and more accessible liquor licenses.
It’s a deliberate choice not to do things that could lessen stress burdens for working class populations.
The real estate lobby getting ahead of this is dastardly, for so many reasons. They did this in 1994 and managed to make rent control a statewide ban or non ban ballot question- that was dastardly because their opponents pretty much by definition do not have the financial means to wage an effective counter campaign and are already a minority statewide. Also, the state demography was and still js primarily homeowners…. voting on policy in places (Cambridge Brookline Boston) that are primarily renters and had much higher concentrations of black and brown residents collars to the state as a whole.
At a bare minimum Boston should be able to propose a rent control measure for its municipality without the RE lobby trying to inject money into things before state legislators even get to see the formal proposal
It seems the proposal is about limiting how much an existing price (set by the landlord to whatever they could get a tenant to agree to) can go up each year, not setting any market rates for apartments to begin with. Thus, while this is being called rent control by the Globe, it's really just rent stabilization. Wouldn't be the first time a reporter let ignorance of terminology get in their way.
I think most people call rent stabilization a form of rent control. setting market prices is such an outdated model I don’t think most people even know that was a thing and wouldn’t casually refer to it.
You’ve been commenting this whole time without knowing the policy?
It’s at the beginning of the thread.
NYC and DC have some form of rent controls or rent stabilization and build more per capita than Boston and have more apartments under $2000 as a % of their rental stock
Boston is a warped market. They will build regardless because building a new unit and pricing it high will make the most economical sense.
Not sure why Bostonians don’t just look at NYC and DC and choose to make only their older buildings rent controlled and not make new buildings rent controlled.
And/Or provide an incentive to large management companies or development firms to make rent controlled buildings an attractive municipally subsidized option. There’s so many ways to approach this but we can’t even get our foot in the door to talk about it before the RE guys and aspiring mega-capitalist try to shout it down with an oversimplified explanation.
Pair that with Zoning Code rewrite and we could do it.
Saying rent Control doesn’t work is like saying a public Housing doesn’t work because Cabrini Green and Pruitt-Igoe didn’t work. Well we now know how to make public housing work, as we saw with HOPEIV redevelopments like Harbor Point, Orchard Gardens and Mission Main- and all over the US. We just chose to stop funding it.
Wu is trying to make moves to tweak our zoning code and article 80 process. But BPDA’s Board is trying to stonewall her.
I don’t understand Bostonians. If you just say no to everything the mayor tries to do how does that benefit the city and the 65% of people who voted for her and her policy and the 75% of polled registered Boston voters in favor of rent control?
What is the end game? And I mean that as an ex-Bostonian. What is the goal? to keep doing what Marty Walsh did?
Boston just doesn’t seem to have the will, vision, and unity to do things NYC has already modeled for them. Like commuter train electrification, upzoning, rent stabilization and more accessible liquor licenses.
It’s a deliberate choice not to do things that could lessen stress burdens for working class populations.
The real estate lobby getting ahead of this is dastardly, for so many reasons. They did this in 1994 and managed to make rent control a statewide ban or non ban ballot question- that was dastardly because their opponents pretty much by definition do not have the financial means to wage an effective counter campaign and are already a minority statewide. Also, the state demography was and still js primarily homeowners…. voting on policy in places (Cambridge Brookline Boston) that are primarily renters and had much higher concentrations of black and brown residents collars to the state as a whole.
At a bare minimum Boston should be able to propose a rent control measure for its municipality without the RE lobby trying to inject money into things before state legislators even get to see the formal proposal
I don't subscribe to that rag and you're on here calling for "rent control" which has always led to less production of housing stock. You continue bringing up DC and NYC despite evidence suggesting you're wrong. How is DC like Boston? DC is a federal city, funded and ultimately controlled by Congress. DC rent ceilings were abolished in 2006 and its rent control laws only cover a small percentage of the rental housing. DC rents have stabilized only recently following COVID when more people began teleworking and moving out of city center. NYC rent laws (see my previous post). NYC also has a housing crisis and their rent controlled/stabilized housing hasn't helped. It's made things worse.
Details on this are scant but what's out there seems impotent. Who will this protect? The rents are already at astronomical levels so those that can't afford it still can't. Those in subsidized housing are fine. So she's going to limit future increases to 10 percent in buildings with more than 6 units and exempt new buildings for 15 years? They're talking about stabilizing neighborhoods that have already been destabilized. They should be looking at ways to protect elderly and most vulnerable and focusing attention on those groups, and also look at changing zoning laws.
The horse is out of the barn on affordable rents, and has been for quite some time. Globalization is the underlying cause and the city's zoning and planning response whilst it was occurring was nil. This just looks like more smoke and mirrors to make it look like someone is "doing something." The just cause eviction thing looks interesting, but I'd like to see more detail on that and who it applies to.
Wonder how many will jack up their rents before this takes effect?
Last edited by bostongymjunkie; 02-21-2023 at 03:58 PM..
I think a valuable concession would be that new construction will not be subject to rent controls/stabilization. That’s what I said a few months ago.
Also, this is meant to protect renters who already live here and can’t afford 14-20% rental bumps. The majority of the city supports this and the majority of the city is renters. Those are both facts.
A destabilized neighborhood is the exact one you want to stabilize. What are you gonna do stabilize stable neighborhoods? How? This is about taking a proactive approach to improving people lives who are highly stressed and living precariously through no fault of their own. They can’t predict rental increases nor can they afford to save to buy. Wages don’t rise fast enough. Schooling isn’t affordable enough.
Found a very smart person with a lot more knowledge than me *on what will remain an unamed competitor site* to explain things far better than I could. Multi-decade commercial and residential landlord here.
You are totally right.
BUT - not all landlords are against what Wu is trying to do here. I’m in favor of it. A 10% increase cap only harms the laziest, worst landlords who shouldn’t be in the business.
I’ve never raised a returning tenant more than 10% on renewal. Usually it’s zero. Sometimes it’s a minimal $50-$100. And it’s not because I’m a nice guy who doesn’t want to make money. It’s because it’s not how you do business if you want to thrive as a landlord.
The real money to be made as a developer/landlord comes from five general things:
1. redeveloping properties to take rents from $1,000 per month to $2,800.
2. using tenant turnover as a chance to raises rents to “market” rate when you get someone with higher financial capacity.
3. over time (think decades) making huge profits due to general market conditions rising. Most of my portfolio was purchased pre-2004. Rents are triple what they were at time of purchase on most of my units. You want to operate in a market where there is a huge future upside to property and rent appreciation. Boston is where it’s at for that. And there are rising “secondary” markets like Charlotte where you can do very well. Places like Worcester and Framingham have been goldmines over the last ten years too.
4. taking advantage of a tax code that STRONGLY favors real estate pros and landlords. Beyond non-cash expenses like depreciation, beyond the 20% QBI deduction that allows you to dodge taxes on 20% of your profits, you have things like immediate write-offs for taking assets out of service when you demo or demolish a structure that can be used to offset millions of dollars of earned income.
5. being able to reduce the cost of carry substantially by recapitalizing portfolios during slow economic times. I refinanced and recapitalized my entire portfolio during COVID and took my average cost of loans from 5’s and low 4’s to loans that are anywhere from 2.75% to 3.75%.
None of Wu’s proposals change any of those levers of wealth creation that any seasoned landlord/developer uses.
What it does do it crimp lazy-ass mom and pops who buy a three-family and think it’s a get rich quick investment. And who try to exploit tenants and take advantage of the huge relocation costs (first/last/security/broker fee + cost of movers) to jack rents on captive tenants from $2,500 to $3,400 on renewal. (Why you’d ever want to squeeze someone who was only quailed for $2,500 to a much different rent tier is beyond me - and it’s a great way to start getting deadbeats and vacancy losses while you try to evict.)
TLDR: Landlords come in two forms in Boston:
1. seasoned operators who rake in money.
2. mom and pops who hire management companies, or who don’t know what they are doing, or are undercapitalized, and yet who delusionally expect their investment to beat 10-20% per year. They complain that they have to repaint a unit, they try to use security deposits for wear and tear, they don’t know how to do background screening, they buy ****ty properties that haven’t been remodeled since 1987 (that any seasoned landlord would avoid without redeveloping) and they then have the balls to complain anytime anything happens that requires they step up and actually take an interest in owning, developing, or maintaining their property.
And those second types of “landlords” can all **** right off. They are noisy lazy *******s who don’t add value. They complain about preventable problems. They have full-time day jobs and own property as some side gig that nobody asked them to take on. They think they can hit the “easy” button and capitalize on the rising fortunes of Boston while simultaneously ****ting on every attempt to keep the city moving forward to keep those rents rising and properties appreciating. They can sell their properties if they don’t like operating in one of the absolute easiest markets in the world to make a fortune in as a landlord/developer. They can buy single family homes in a “landlord friendly” state like Texas and rent to poor folks in rural areas and see how that goes.
All that said - there are legitimate concerns and arguments against how rent control often locks folks out of housing because it keeps lower income folks (or long-time tenants) in “rent controlled” units that are far below market rent. And whether rent control really serves it’s intended audience as well as it seems. Or whether Wu ought to be relaxing zoning and allowing for far denser multi family construction. Or whether Nimbys in rich burbs should **** and allow a few apartment buildings to be built. And those would all be fine to raise here, except I don’t see anything in Wu’s rent increase proposal that leads to those issues. 10% is an enormous rent increase. Nobody should have a beef with it as a cap. It won’t lead to what these lobbyists are claiming.
Who is this "very smart person", and where does he obtain the authority to make all these quite assertive claims with absolutely nothing to back them up? Much of it just don't pass my BS detector.
Who is this "very smart person", and where does he obtain the authority to make all these quite assertive claims with absolutely nothing to back them up? Much of it just don't pass my BS detector.
He’s a landlord from East Boston.
What doesn’t pass your ‘BS Detector’?
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