how do you handle 10% rent increase in this economy Around Town, posted by kcmdancer, a resident of the Vineyard Avenue neighborhood, on Jun 28, 2011 at 1:11 pm
Due to our current economy I have only received a 5% wage increase in the last 5 years, however after just over a year lease expires my rent is going up by almost 10%. I asked if they would lengthen my new lease and reduce the increase due to extenuating circumstances I currently have,they informed me that they can't do anything. I don't buy that, there are always exceptions.
Prior to moving into a corporate run apartment complex I lived in 2 privately owned rentals, over a 7 year period neither ever raised my rent. Why do corporate run complexes take advantage of families who can't afford to move as that is cost prohibitive?
When your expenses keep rising and your wages don't keep up how do you get by?
Posted by money_for_nothing, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 28, 2011 at 6:06 pm
This is one of the fallouts from the housing crisis (a.k.a. walkaway from commitment (mortgage)). So many people have hosed their credit that they now need rental paces to stay for a long time before they can buy again. Also, with housing prices in the dumps, only the people who need to sell are selling, so again more people need rentals. Supply & Demand is kicking in because a lot of people need a place to rent and they aren't building many new ones right now so rents are going up everywhere.
Your options is they won't budge on rent is obviously to move to a (probably) crappier place with cheaper rent.
This isn't necessarily a corporate greed v private (not greedy) rental situation - its a rental situation and a timing issue. Many apts did not raise rents very much or at all over the past few years but this is all changing now.
Posted by taxpayer, a resident of the Downtown neighborhood, on Jun 28, 2011 at 7:54 pm
I have been a landlord for more than 30 years and have never -- ever -- not raised the rent every year. My properties (single family and duplexes) have a waiting list of people who will pay whatever I ask. In return the properties are perfectly maintained at all times. I rent month to month only and my tenants know that they will pay on time and take care of the property or they will need to move. More than half of my homes have not had renter turnover in over 5 years, several in over 10 years.
It is not hard to be a good landlord and a good tenant. Just don't try to tell the landlord that they have no right to raise your rent. It is not an aution or a flea market where you can make your best offer. The landlord takes all of the risks and burdens of ownership, you pay for that.
Posted by Sam, a resident of the Oak Hill neighborhood, on Jun 28, 2011 at 8:40 pm
I agree with "money". It's not a matter of corporate- versus privately-owned rental. It's a matter of supply & demand. The rental owner wants to maximize profits - as does any other business - and will try to charge you whatever the market will support. If your current rental owner is raising rents 10%, then it's likely that that's because everyone else is raising rents 10%, too, probably for the reasons that "money" stated. Ask around at other apartment complexes and find out if that is indeed what's happening. If so, then that's the market situation you have to live with.
Posted by Agree, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 28, 2011 at 8:54 pm
I agree that it has to do with supply and demand. Just a year ago, I was paying more for my mortgage than my neighbor was paying for rent. I refinanced into a lower interest rate, and that combined with the increase in rent for my neighbor, I now pay less for my mortgage than my neighbor does for his rent!
Posted by Leland, a resident of the Happy Valley neighborhood, on Jun 29, 2011 at 6:03 am
I own 16 homes in and around Pleasanton. I have instructed my rental agents to raise the rent 10% on a yearly basis; when one of my units goes up by 10% so do all the rest, thus creating the illusion of supply and demand. I rent these houses in order to supplement the income I inherited from my Daddy. Once I found it hard when my increases forced a family of six to move out; but since then I've had an agent do the evictions for me. It's a good way to make income. The rents more than pay for the mortgages, and then some. This is what America is all about. Some people labor in fields; my investment money and rent payments labor for me. I see it as America getting back to producing things -- like money. For me.
Posted by Lindsay, a resident of the Vineyard Avenue neighborhood, on Jun 29, 2011 at 8:55 am
Sorry to hear your landlord won't budge. Your only choice is to move and hopefully find a landlord that won't keep raising your rent or try and buy a place of your own. If you suck it up and pay this increase, chances are your rent will go up again in a year.
I guess I am on the other side of the pro rent increase people, I think that by not raising the rent each year you can retain good tenants and any decent landlord should want to work with their tenants especially if the tenant is maintaining the property and paying their rent on time.
Posted by comment, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 9:30 am
I'm surprised by all these renters. Renting is just throwing money down the drain. Owning is building equity. Renters are losers. The market is picking up. Buy now, or you'll be kicking yourself in a few months when you're priced out! Everyone knows people care about their community and have less crime when they own and not rent. There has never been a better time to buy (or sell) a home!! If you don't think you have enough money? Talk to an agent. They can get you into a payment that you are comfortable with. You may not even need a down payment. Don't worry about the details like interest only, early payment penalties, negative amortization, and all that other confusing stuff. Just focus on the initial payment. The bank wouldn't loan you the money if it didn't think you could pay the loan!! Just do it! The only way to make money is in real estate!!
Remember when all the real estate agents and mortgage companies talked like that? What a shame.
Posted by Count your blessings, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 10:02 am
Money_ is right. When people have lost their homes, the only option is renting, so there are the usual renters plus the former home owners.....driving up demand.
And....sorry kmcdancer, if you got a 5% raise....consider youself extremely lucky ! ! !. I have a family member who for 18 months had to live on a $1,000. mo furlough pay cut, followed by these last 12 mo. with zero pay.....consider yourself damn lucky....Wells Fargo still expects their house payment.
Most of you were just blowing to convince yourself you are brilliant...your're not.
Posted by reasonable, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 10:39 am
Many property owners have spent the last few years losing money -- sometimes the mortgage was more than the rent, sometimes a place would be vacant for a couple of months or a tenant doesn't pay (it can take over a year of rent to make up for that). Add in things like roof repairs, plumbing, etc. and it is actually very hard to make money renting a place. So nobody is trying to take advantage of you. It is just business/life. Maybe your landlord is making money because rentals are in higher demand (i.e due to foreclosures, as mentioned above). That is your landlord's income just as your job is your income. You have a choice of moving into a cheaper place or cutting back on some other expenses. Many of us have had ups and downs these past few years and had to cut back, sometimes severely. It is not about you.
Posted by comment, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 10:43 am
I was someone who was inclined to keep a reliable tenant in a property for under market rate just for the stability. It is easy to loose a lot of money, and (more important for me) time on a bad tenant. I would recommend that kcmdancer interview landlords and find one who is looking for a long term renter. I'm no longer a landlord. I sold my property and never looked back. It is too much hassle and doesn't have much upside for quite a while. If I had to bet, I would say we're looking at another 10 to 15% down in Pleasanton house prices in the next five years.
To "Count your blessings",
Sounds like maybe you need to consider selling and getting out of the landlord business too. I'm hearing a lot of anger and frustration there. Think of your properties like stocks. Don't marry them. Know when to cut your losses.
Posted by Comment, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 10:46 am
I'll just repeat what I said above, as that was addressed to Carlos but was partly meant for you. I was someone who was inclined to keep a reliable tenant in a property for under market rate just for the stability. It is easy to loose a lot of money, and (more important for me) time on a bad tenant. I would recommend that you interview landlords and find one who is looking for a long term renter.
Posted by christian, a resident of the California Reflections neighborhood, on Jun 29, 2011 at 10:53 am
There was once a guy named David Ricardo. He argued that the best indicator of an immoral society was the extent to which people would go to make money off of unused property. He argued that renters, per excellence, were perfect examples of folks whose moral compasses went awry. Funny how growing up capitalist gives us permission to exploit others who have less than us. There once was a guy named Jesus.... But I guess he'd had argued that the more rent money you can get the better it is for you.
Posted by Bushnell, a resident of the Danbury Park neighborhood, on Jun 29, 2011 at 11:39 am
Well I might as well admit this but I have 3 pieces of rental property and all 3 are upside down. I stopped making the monthly payments over 18 months ago on all 3 but have continued to collect the rent. I do not believe they will go back up but have asked the renters to move out because I am going to walk completely away from the loans.
Posted by Count your blessings, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 11:39 am
Carlos, where did you get anything about rentals from me? Maybe you should read a bit slower. I was talking about how lucky she was to have any raise at all, since there are people, like my family member
who had to live on furlough pay cut for 18 mo. and is now 12 months with no paycheck at all, but still has to pay Wells Fargo....but kcdancer is whining about a 5% raise !
Posted by Count your blessings, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 11:51 am
I have zero tollerance for Bushnell. My family member is totally depleting his savings, since he hasn't had paychecks that would meet his house payment for 2 1/2 years now...and he's now approaching retirement with zero savings. But he is hoping he'll find a job soon, so he can hang onto his house. He hasn't missed a payment yet....in his 2 1/2 yrs of hardship. YOU are who is making his value drop....hope I never meet you face to face, even tho we're neighbors.
Anybody who refi 3 rental properties, and CAUSED this mess, deserves to suffer, but not the people who never refi their fixed rate loan,and whose company went out of business, leaving 100 UNemployed.
The refinancers, the walk-awayers, and the liar-loaners should pay the victims who didn't do any of that, but are doing the suffering.
Posted by Bushnell, a resident of the Danbury Park neighborhood, on Jun 29, 2011 at 1:43 pm
Count your blessings,
Everything I am doing is purely legal and well within the new Obama mortgage affordable act. I am even going to take the proceeds from the rent I have been collecting and pay cash for a repo at auction and will be completely out from under this mess.
Posted by Be diligent, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 2:09 pm
"Well I might as well admit this but I have 3 pieces of rental property and all 3 are upside down. I stopped making the monthly payments over 18 months ago on all 3 but have continued to collect the rent. I do not believe they will go back up but have asked the renters to move out because I am going to walk completely away from the loans."
This is why renters need to be diligent. Go to sites like propertyshark.com and get the info on foreclosures, pre-foreclosures, etc. If your landlord has stopped paying the mortgage, then stop paying rent.
btw, as a renter you can sue people who do the unethical things like the poster who is about to walk away from the 3 rental properties. Sue him/her in court - what do you have to lose? Many attorneys will work pro-bono as this kind of stuff angers many.
Posted by Count your blessings, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 2:16 pm
So Bushnell, you're dubbed Count your blessingsII. It's just sad that of all the people that are suffering, it is wrong that even those who did everything by the book is paying the price of no job.
Actually the whole house issue would be solved if there were only JOBS, JOBS, JOBS...But, Obama was busy with Health Care and wasted very valuable time, that can never be recovered to save company closings and jobs lost, while he was screwin' around with 'health care'...sort of like fiddlin' while Rome burned.. But now that it's campaign time again, he's on the trail in the name of JOBS ! Why yesterday he went to give a campaign speech to the United Steel Workers, USW, the union workers at Alcoa...like that's dealing with manufacturing....he's still clueless, and doesn't get all the SMALL company closing where NON-union engineers, etc lost their jobs. If they're not union, or not green, they're tossed aside as collateral damage! This year it's all about campaigning to unions, to get them back to do his grassroots dirty work. 3 weeks ago it was Michelle here to rev up Oakland youth to keep that base, and he'll work on the union base. He doesn't allow the press to report on CA UNemployment of 13%...since national 9+% is bad enough...but CA is in pain. He flies in to grant 1/2 Bill $ grants and loans to solar companies, but other than than, it's let the 13% suffer....just keep it quiet. CA small companies and main street needs jobs...
Posted by Boner, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 29, 2011 at 3:25 pm
Count your blessings,
You are probably right about Obama but we will vote for him again because here in California it is about doing the cool thing and not necessarily the right thing for the citizens. Heck, look who we have in Sacramento and I do not just mean Brown but all of the other big spenders from both sides. We have so much waste it is beyond belief. Did you see that we are paying Scott Haggerty $234,000 dollars per year? and for what? Think about his pension which is coming
Posted by Fred, a resident of Livermore, on Jun 30, 2011 at 1:09 am
Currently my sister is renting an house and paying slightly below market rent as her rent hasn't gone up in some time. She rents from an elderly lady who owns 3 houses, one she lives in and 2 rentals.
In this case my sis's b/f actually helps with the repairs on all the landlord's properties since he's done construction type work all his life and she gives him percentage off the rent. If something needs replacing, he'll obtain the item and install it too.
Just recently my sister and the landlady started on the process to purchase the house so it be one less property to worry about.
So landlords do come in all types.
Regarding Scott Haggerty, it is time for retirement for him.
Posted by Leland, a resident of the Happy Valley neighborhood, on Jun 30, 2011 at 6:10 am
I'm a Christian too, but my Daddy taught me that charity starts at home. Its perfectly Christian to extort high rents from sucker renters who are too lazy to begin a small business on their own. It's not Obambi's fault. The banks I own just don't want to pour money into small business ventures when so many state workers are losing their jobs, getting furloughed and having less money to spend on fast food. If I'm going to finance small businesses, I'll do it with overseas operations where solar and wind is already well off the ground and moving forward.
Posted by Julie, a resident of the Another Pleasanton neighborhood neighborhood, on Jun 30, 2011 at 1:23 pm Julie is a member (registered user) of PleasantonWeekly.com
kcmdancer, to answer your final question above, there are a few things you can do when wages don't keep up with expenses. For us the first luxury to go is eating out. I found that by planning menus in advance and purchasing the ingredients (esp. utilizing Costco) that I cut our food bill by more than 10%. I also made sure to grab less fast food as that adds up. We choose entertainment carefully and try to find deals on those as well (e.g. discounted Regal tickets at Costco).
I'm sorry for your situation - the fact that many of us are in the same boat doesn't make the load seem lighter.
I'm from SF and there was rent control. The rent could not go up more than 4%. This was years ago, I don't know what it's like now. Our landlord liked us because we paid on time and made little improvements to the apartment so he didn't even raise it the first year.