I'm so extremely grateful that I accepted section 8 tenants into my rental units. Most of these tenants have nearly all of their payment covered by the government and they just have to pay $100 or $200 on top of that to cover what the government won't.
These tenants are often not accepted by landlords because they're thought to cause more issues. Mine are great. They keep the units spotless, mow the lawn for me on my multi unit properties. When I have a tenant like this, I never raise their rent, and if they can't pay the hundred bucks the government won't I sure don't care.
I love my section 8 tenants. Same here, they take good care of the place and the government doesn't miss rent payments.
Some counties even provide free legal help for landlords if their section 8 tenants do something bad. It's actually pretty low risk.
The main downside is the increased overhead of paperwork and inspections. The government wants to (rightly) make sure you aren't a slumlord so they do a lot more inspections.
I'm on the other side of the spectrum. I converted all my units to luxury units, and have had far far fewer tenant problems after the renovations and rate increases.
High paid tenants seldom miss payment - I've setup automatic EFT withdrawal from their accounts, so I don't even need to process checks, and they aren't really impacted by the rise in unemployment right now - most just work from home.
I think the bitter spot for being a landlord (especially now) is to manage low-mid income units. ...it's just a constant stream of problems - people moving in and out - single mom's that chronically cannot afford the rent - unregistered tenants - people that refuse to pay and refuse to move out - drug and police raids... like it was a total total nightmare.
Managing 12 low-mid income apartments was a full-time nightmare. Managing 12 high income lux units now takes about 4 hours every other weekend and is usually a pleasure to do.
Interesting. I'm actually a bit separated from it because I pay someone ~8% of my rents to manage the place, I wasn't aware of any extra inspections or hassle so I guess I'm getting my money's worth.
My mom was obsessed with providing Section 8 housing and low income housing, the tenants were a mess every single time. I was put off on the entire concept and hassle of real estate, until I was exposed to inner city luxury housing. Which is priced in its own privileged tier to even get started as an investor.
Of course it comes down to the people, regardless of the psychological incentives. But maybe the incentives promote some poor behaviors enough that its such a shared experience of poor behaving tenants.
I own an apartment in Rome that I rent because I don't live there anymore.
It's rented to a Bengali family that nobody wanted as tenants because they're immigrants and such (you can guess the reasoning behind it)
They used to bring the grocery home to my mother, so I gladly accepted to rent my house to them when they asked
They've been the best tenants I've ever had and due to covid they found themselves in the position of being one of the few local shops still open in the neighborhood, so their business didn't suffer much from the lockdown.
Many in Italy stopped paying the rent for 2-3 months as of now, but they always paid in time and in full, I asked them if they needed a cut on the rent to save some money, due to the bad situation, but they refused the offer.
So I'm installing air conditioning at my expenses in exchange
It's good when things go smoothly despites the odds
> if they can't pay the hundred bucks the government won't I sure don't care
I used to have this same mentality. Until the person who was renting one of my properties decided to lie about certain issues (like claiming a shampoo bottle lodged down one of the toilets was there for years). When I decided to not renew the lease with that tenant, they decided to cause considerable damage to our property.
Sometimes, when things come easy to people, they don't appreciate it. Holding people accountable helps them lift themselves up too.
Anyone who thinks anything comes easy because you're poor hasn't been poor except in the poor college student "working" their way through the college daddy is paying for type of poor.
Your experience points to the human race sucking not poor people.
> I used to have this same mentality. Until the person who was renting one of my properties decided to lie about certain issues (like claiming a shampoo bottle lodged down one of the toilets was there for years). When I decided to not renew the lease with that tenant, they decided to cause considerable damage to our property.
Surely the lesson here is that "this person was a criminally inconsiderate jerk", not "all Section 8 tenants are untrustworthy". (cr__ put it more punchily while I was posting: https://news.ycombinator.com/item?id=23409805 .)
> Sometimes, when things come easy to people, they don't appreciate it. Holding people accountable helps them lift themselves up too.
How does denying housing to someone who needs it help them lift themselves up?
Bless you for taking a chance on the less fortunate. It sounds like you treat your tenants like people and they in turn repay you in something way more valuable than money: their time and kindness.
You're very lucky. Rented to a single mother with two teenage sons. The teenage sons that decided to strip down living trees of their branches, to make bonfires for parties in the backyard. Two trees are severely damaged, and anything that was burnable in the landscape is burnt. I don't even know how to go about pricing out the damage. Insurance is paying for their rent, because the last house they lived in burned down.
Sent her a strongly worded email. She promised not to make more bonfires. But I was there this week, and more branches where hacked off, and one tree is almost hacked of its bark 60% around. Can't sleep at night, getting anxiety that they will burn the place down. They're to move out before the end of the month.
I'm not a lawyer but reddit's r/legaladvice seems to enjoy referring to people to tree lawyers. From what I gather there's a lot of money involved in tree laws. And if you've got picture evidence that's especially loved by lawyers.
Hire an arborists to assess the trees with whatever is remaining; street view images. Also an appraisal based on arborists opinion. Mature trees are very pricey in legal damages. as essentially irreplaceable.
I could never imagine this scenario. But I have a Tree Addendum I had drafted specifically because I don’t want my tenants to even lay a hand on the trees. I’m more worried by negligent tree trimming that kills a tree. But it sets value to each tree too. Something like “$1000 per inch diameter at 18” above ground.” Sorry about this situation you’re in.
How big is the tree? Beavers cause this type damage and they also can't be reasoned with. If it's small enough to reach 60% of the bark just have it cut down and into pieces. It seems to make good enough firewood for them, hopefully the'll burn through most of it and you can plant a new tree in the ashes next month?
I lived in a building with a few section 8 tenants. Most were disabled, some elderly, and others young single mothers. I only found out we had any at all because the property manager mentioned it to me. It was primarily a building of young professionals and grad students. She told me management love them. Government always pays the rent on time. They still had to pass a background check so that locked out a lot of the assumptions.
I am very thankful to hear you have had a good experience with your Section 8 tenants.
As a HUD-VASH veteran recipient in Los Angeles, I have hoped to discover that there are reasons to expand programs for more low-income people in the United States. I am EXTREMELY fortunate as a veteran to receive housing assistance. Thanks for making it possible for people in need to have a safe and affordable option! Blessings!
You should waive their fees for the duration of Corona, and refund any ones you've received! Just saying, it would be a great way to do some good, and they might get a lot more out of the 100/200 than you would!
I don't suppose the struggling non state supported private renters whom you outbid to buy these houses, which they might otherwise have been able to afford to buy themselves, but who are now paying rent to some other landlord instead, are quite so enamored with your altruistic enterprise.
I actually lived in this multi unit property when I first bought it. My wife and I were newly married and buying a multi unit property qualified us for a 3.5% down payment which was much more management than >=10%. Also, I live in a rural part of America where property values are relatively stable because there's so much room to build. There are ample new homes available and new homes cost about $100 per sq ft. Existing homes are unable to rise above this except for extreme circumstances.
There is a real problem with the situation though. And I want to distinguish between the decision you've made, which are savvy, and the broader picture where this showcases some of the more unfortunate elements of socialism.
It is a terrible outcome if millions of Americans are about to go broke and the relative winners are people who (a) totally rely on government handouts and (b) rely on people who are totally reliant on government handouts.
This story points to a situation where a rational person would rather be involved in ventures that produce less resources than they consume. That will really start to hurt the absolute measures of prosperity if it persists for long.
> You're ignoring the potential effects on property value.
Bingo. Surprised nobody else brought this up. Not to mention the neighboring home/property owners are going to be pissed off because it's a potential drag on their property value. Though the stigma against section 8 may not even be warranted. I wonder whether there are any studies on the effects of section 8 on communities.
This is just the start. Landlords would be smart to work with tenants to share some of the loss and renegotiate temporary adjustments to keep at least some revenue coming in because the heady days of high demand for rental units is likely behind us for a while.
It'll be worse in downtown areas. I've heard from multiple firms that are looking at downsizing their expensive office space and continuing to allow employees to work from home. if a person doesn't have to work downtown they will often choose not to live there either.
COVID is going to change the face of urban real estate. So if you have a tenant, they're gold and do what you can to keep them.
Unfortunately, as part of the unfolding of the post 2008 recession, a lot of rentals shifted from individual or smaller landlords to larger corporate landlords whom take a much more impersonal approach to making it through the depression. To some degree, to the extent they can take out holdover loans and let rentals sit empty, they will do just that - irregardless of the social utility of compromise.
This is the pernicious dynamic. For Large landlords, certainly but also generally, you have a situation where property appreciation becomes more important than rental income, so evicting people and getting nothing becomes a better outcome than lowering rent.
Edit: Also note this appreciation driven dynamic is something of a product of QE - printing money. As the treasury dumps money into markets, anything of apparently reliable value, "money-like", becomes more valuable - commodities and land being examples but the "best" companies also. This appreciation process becomes more important than the ordinary use of the object in the case of land (empty mansions in London being the prime example but we may wind-up with many more if the approach continues).
Was a renter in 2008 and you are spot on. Same situation in the Bay area as well as NY/CT. It was insane that rents started to go up during that time. People basically walked away from their houses and started to rent. It was weird. Also, the "corporatization" of housing scared me a bit. Consider the area in downtown Mountain View. Rent was under 2K around 2008. The corporate landlords did minor renovations (fancy gyms, granite counters, maybe a redo of flooring) - they then did fancy websites and sold a lifestyle. Totally focused on the high-paying tech jobs. I used to live in a complex with families and non-techies. All that evaporated as rent shot up to 3.5-4K for the exact same units.
Corporate landlords are rational and reasonable negotiators who will readily respond to market signals. Small landlords are a crapshoot; you might get one who just prefers an empty unit over lower rents. You can easily see this from craigslist data right now. Large buildings are lowering rent faster than small buildings and single-family houses.
I wonder if that explains my current place. There was a recent ownership change and right before that the owners cut down the shade trees for the house. There's no air conditioning so back in April it was already getting too hot to stay indoors. The lease renewal is in June so when the new, corporate management company asked us if we wanted to stay and that they were generously not going to raise rent, we asked they either lower the rent or figure out a cooling situation. They balked so we walked and they didn't flinch at all. They were honestly surprised we weren't going to take such a deal.
In California for example, due to state-wide rent control, it's very dangerous for a landlord to lower rents. I would rather offer 6 months free rent than lock into permanent nonadjustable lower rent situation.
excuse me, but dangerous for who exactly? You mean your future returns on investments will be lower on your rental property? How exactly is that dangerous? Is someone's life in danger? If anything, lower rents allow more people to afford housing, making it less dangerous.
Let me guess, you have huge problem with the homeless situation, but are unwilling to consider lowering rents? Is that right?
If a lot of landlords start exploiting that loophole, I wouldn't be surprised if the law were revised to be based on the average rent over a year, or something similar.
At the same time maybe it's time for landlords who have been sitting in armchairs swimming in cash to start giving back to the people who haven't been able to afford to live here?
You’ve got it backwards when it comes to residential real estate. More people become renters during a recession. Vacancies reduced dramatically after 2008.
In some places, like Oakland and Tahoe, rent seems to be going up. But in San Francisco it is going down. Probably all as a result of people fleeing San Francisco to nearby places with a cheaper rent per square foot.
Mix shift. Oakland has just gone through a major wave of new construction. New apartments command higher rents. This does not necessarily imply a movement of people.
Are that many people really moving away? I understand the logic, but it's a major life decision, so I'm surprised if it's happening so rapidly in response to covid. I've heard of people leaving the city temporarily, but assumed many of them were maintaining their apartments.
I would have guessed the lower rents were more about money drying up, and landlords being desperate to hang onto any tenant who can pay.
Google 'white flight' for historical precedent. It remains to be seen if it will happen again, but it is certainly possible. I know I'm ready to leave the Bay Area for someplace boring.
If there is deflation in the housing market, then marginal mortgage holders will walk away and become renters. That will swell the ranks of renters and drive up rents.
In many metro areas owner occupied real estate is overpriced relative to rents. When this imbalance corrects rents will rise, as before the correction owner occupants were subsidizing renters by overpaying for property even though renting made more sense.
Leases are typically for a fixed period, so it's really the integral of these charts that matters - how many people are currently in a rental.
I suspect that number is still a long way below normal, because lots of people are moving in with friends or family (students, young professionals, etc.).
My experience in London is the ratio of people looking for a house to houses advertised is the lowest I've ever seen in 10 years.
>He says a call center worker told him that he didn't qualify for any help because he was late on a car payment last year. When NPR contacted Ford, the company said that is not its policy. And after reviewing the case, the company is now letting Baird skip his next car payment, which he says is a big help.
It appears Ford operates on the Google customer service spectrum of only helping those who can gain support of public outcry.
What I would like to see is a response from Ford that they will open an investigation to review everyones requests which have been denied for skipping payment.
Like when Wells Fargo investigated their mortgage department and found no problems, right? Or when Google investigated Andy Rubin and decided he wasn't that bad and protected him for three more years? Why on earth would you ever trust a corporation to police themselves? They always lie, they always fail.
It can't hurt to expect companies to actually troubleshoot their own policies. We don't have to expect that it's the only recourse (eg. government regulation, civil suits, public brand shaming, etc).
I have a commercial tenant who was forced to shut down their business during the lockdown. I just waived rent until they were allowed to reopen. You can't get blood from a turnip, and I really don't want to force them into default and try to find another tenant in this environment anyway.
Here in Czech Republic there is a program where government pays 50% of busines rent as long as the property owner agrees on a 30% discount and the tennant pays 20%. The program covers March to June (three months) with most businesses having to be closed for about six weeks from that and restaurants fully reopening only recently.
IMHO this is a really good idea while not giving money away due to each party covering a part of the deal.
There's plenty of landlords in SF who think turnips bleed. There was a cafe that just closed permanently because the landlord wouldn't lower the rent, in a building bought 20 years ago for $1m where the gross rents are over $60k/month. You do the math.
This has been very much the case in UK high streets for the past few years (on and off since '08). In the county-town where I grew up a Starbucks (!?!) closed because the rents were too high. Even before the pandemic, a number of shops have closed down in the last year, so it will be interesting to see what's left 6 months post lockdown.
The only businesses in that town that have been booming are retirement homes... but after this I assume there will be a lot of empty properties.
I needed a haircut even at the beginning of the lockdown, so it got pretty long in a hurry. My wife finally got sick of it and cut it for me a couple weeks ago.
I think that's probably the smart move, at least for commercial property in this situation. The waived rent is essentially an insurance premium against the risk of vacancy coming out of the recession.
We have small scale commercial tenants and halved their rate and extended terms. Would rather retain tenants we like than play hardball and risk having to find new ones. Over the last couple of months, we've lost one tenant (half rate) but gained two (full rate).
I dunno though. It's a small enterprise that doesn't do a lot of business even in good times. I'm ok helping them out. It can be my good deed for the decade.
I like to remind people that in 2008, Bear Stearns fell in March. Most of the the economy didn't realize the financial system problems until late August.
I'm waiting for a very large shoe to drop in a few months. How big will depend on whether consumers feel comfortable about their jobs+health.
The turnarounds always happen quickly after the fed takes serious action. Consider the 2008 crisis, or take 1933 (I believe?) when we broke from the gold standard: immediate exit from the Great Depression.
The fed and congress have been very on point with the stimulus response speed this time around and so I think we’ve seen the bottom of the market through this. And most investors are voting with their dollars that this is true.
Titanic Syndrome. Everything's going under, but the people on the upper decks are still enjoying their late-night cigars while the boiler crew is drowning. It's an interesting phenomenon (and, I'm sure, has a better name than the one I just made up).
Probably. Though with some weird details. I'm actually getting paid more right now being "furloughed", with the approval of my employer and (tacitly) the state. When the "don't work" bonus ends, I'll revert to full time.
> Probably. Though with some weird details. I'm actually getting paid more right now being "furloughed", with the approval of my employer and (tacitly) the state. When the "don't work" bonus ends, I'll revert to full time.
I think a lot of people haven't realized that for many workers, being furloughed or having your hours reduced can result in an effective raise under the current Coronavirus aid package.
A friend's company furloughed everyone on Fridays. She was disappointed at first, until she realized this hours reduction qualified her for the $600/week Coronavirus aid. Now she's making more money, working less, and enjoying 3-day weekends.
Now everyone at her company is trying to convince management to continue the Friday furlough until the $600/week stimulus runs out.
This is why I don't trust the unemployment claim numbers until after July. Too many perverse incentives to increase the number of claims.
this is true. will probably happen at my workplace as well unfortunately. the PPP was a stopgap which helped a bit, but sales are still not back to normal to help pay for full staff.
My company, an experiencial ad agency, furloughed all but 2 people in every non-finance Dept March 23, rehires everyone with big paycuts (me, 37% cut) April 27 through PPP.
No new business was able to be drummed up and now massive lay offs of 90% of the US offices starting June 15 with a paycheck severance so effectively June 30. The EU offices have faired better with more work, and few layoffs of only receptionists.
All and all it’s bleak for the events industry. I’m sure that a lot of convention centers, caterers, AV rental houses, independent producers, PAs, will all be on the dole and you’ll see a huge spike in unemployment on Aug 1.
Lockdowns are effective as tourniquets, but indefinite or long term use was never logical. There should have been more forward-thinking and pragmatic options pushed earlier. We will now see the natural repercussions of lockdown-centered policies.
I think you may have misunderstood the point of lockdowns.
Lockdowns are/were intended to prevent jamming hospitals with COVID patients which would lead to non-COVID emergencies being put at risk.
The idea is to lockdown an area not to STOP, but to SLOW the trickle of new patients into hospitals at a rate they can be serviced: e.g., balancing the pipeline. In anticipation of the huge surges seen in the North East US, many hospitals built-out their capacity but didn't need it. Thankfully, and hopefully they will not.
As for "natural repercussions," the different phased-reopening plans that governors are drawing up all share the same thing: let's try opening a little, and if the cases shoot up again, lock down if hospitals are at risk of overflowing. We just don't have a national policy, it is patchworks of different state alliances.
It was the best idea at the time, and we all know the only other proposed solution was to NOT lock down and let those who are susceptible pay the price. Some people on the news vocally approved of that idea, most people did not according to surveys.
“Los Angeles County, which has recorded the highest number of coronavirus cases and deaths in California, has extended stay-at-home orders indefinitely.”
Exactly. It was time to get our feet under us, get PPE, get testing capacity up, get contract tracing in place etc. Kentucky, my state, has started opening up but is watching the numbers closely. No one wants to stay locked down.
It's going to be very interesting going forward. The American public (myself included more times than I would care to admit) is really good about moving on and having a short-term memory on things (Lots of these things happened back in 1918 with masks, social distancing, lockdowns, people hating the lockdowns, etc). I worry what happens when you couple that urgency to move on with something that, from all indications, cannot be swept under the rug.
I guess it depends on how you define long term. I do have friends who think the lockdown should last in its current form (ie extended holiday with extra $600/week for the unemployed) until there's a vaccine.
Flattening the curve was the refrain but we seem to have forgotten that.
If there is no spike in infections within two weeks, from areas which had large public protests in the past week, can millions of Americans be helped by restarting the economy?
>If there is no spike in infections within two weeks, from areas which had large public protests in the past week, can millions of Americans be helped by restarting the economy?
Daily new infections have more than doubled here in North Carolina in the last two weeks since "reopening" [0]. We have had more new cases in the last two weeks (2200) than in the entire length of lockdown from March until then (2000). The death rate has massively spiked beginning May 24th, exactly two weeks (the median time from infection to death) from May 9th, the day the governor relaxed restrictions [1]. The dream of this thing just magically going away is absolutely delusional.
There are more tests than there were a month ago, and that affects how many positives are seen (by some amount).
Also the increase in deaths you link to is not statistically significant, given it is in the rage of 10-30 over the course of several months in a state with 10 million people.
Is there a dashboard which shows increase in testing capacity over that same period, case demographics, presence of other medical conditions, and asymptomatic cases?
With increased (including employment-related) testing, case count should be increasing everywhere, but some of those could be recovered or asymptomatic.
We know that most hospitals were well below capacity, so new cases can be treated.
> Daily new infections have more than doubled here in North Carolina in the last two weeks since "reopening"
Confirmed cases, not infections. The hospitalization numbers are about 30% higher or so which is about-ish how much new deaths have increased. Which is bad, but not 2x bad.
All said, NC may have one of the highest spike of any state (reopened or not). Texas and Florida have flat hospitalizations; Georgia is slightly decreasing.
> The dream of this thing just magically going away is absolutely delusional.
Since we don't really know what's going on yet, almost anything that happens is going to seem kind of magical. Right now we're operating on guesswork and superstition.
Yeah, the 7 day moving average of new cases and deaths is also slowly trending up [1]. I think we all wished COVID would just go away, but that seems unlikely.
Remember the whole point of shutdowns was to "flatten the curve" to keep the hospitals from being overrun. We can't stop the disease and we can't commit economic suicide.
> can millions of Americans be helped by restarting the economy?
That's already happening. The current slow reopening is restarting the economy in order to help millions of Americans get back to work. For example, the jewelry store in my neighborhood in CA is now open, but for 1 customer at a time (OK in their case because even before the pandemic they controlled the number of people inside). However, the breakfast diner nearby with closely packed tables is still shut down. Even if they could open, the owner has to figure out how to run that business with appropriate social distancing.
An additional problem is that the economy was fragile even before the lockdown. Many employers likely won't rehire nearly as many people as they let go. Those who are still hiring have slowed down their hiring rate.
And until people feel safe consuming services and gathering in public like they did before, the main street economy can't recover fast enough to employ everyone who was laid off during the lockdown.
This is why government support for laid off workers must continue until enough confidence exists that things are safe, even without the lockdowns, and that might take years for some sectors of the economy.
I suspect we will be told that the protests were necessary and for a greater good that outweighed spreading coronavirus, and now that they're over, we should all go back into lock down to prevent further spreading, and anything else is reckless and literally killing people.
Just today I saw an article that said the covid recession is over.
However...it appears that new infections have been rising again globally since May-ish. It looks to me like it is becoming exponential again, although the slope on a log scale is considerably less than the first time.
Deaths still seem to be declining, but you would expect that to lag regardless.
There seems to be a pattern where the larger countries that weren't hit so hard at first are picking up as developed Europe gets things under control. For instance, India, Brazil, Russia, Pakistan etc.
And within the US, as NY and NJ have fewer new cases, Texas, California, Illinois, and Arizona are starting to take the lead. Over 90% of new cases are outside NY and NJ now.
Type of activity seems to matter a lot. Protesting in a park with quite a bit of space, where people are mostly wearing masks, is a different thing than sitting in a bar having a beer.
As a passive real estate investor I'm seeing bidding on new sales has actually been more competitive than ever in my area (Atlanta GA). A lot of houses are selling above asking prices with 8-10 offers on the table. I am not sure if people genuinely think it is a good time to buy, or is it mostly FOMO.
I think people who can work from home and who didn't get laid off are fine and the stonks appeared to mostly recover (which may explain some of the money sloshing around the market).
I think there will be massive economic damage in 6 months that we aren't focusing on right now.
I agree. A good portion of the 40m job loss are not gonna be fully recovered even if the situation improved a little, not to mention it is getting worse by the day.
Is anyone (except govt employees and people making PPE/in healthcare) really fine? The economy is so intricately connected, I feel that everyone will eventually pay the price. The large-corp tech sector has been fine so far but I am not sure how comfortable I am taking on a large mortgage. Atlanta is cheap .. a bay area techie could probably buy a place in cash.
My wife started a co-working space January this year, it was her office and the co-working bit was to save on the rent with a prediction of some profit in a year or two.
Then covid happened, so we gave our notice to the landlord and are looking for a bigger house, with a spare room she can use as an home-office
We're saving money from the office rent and investing them in a less potentially profitable solution, but safer, at least for the moment.
Apparently this is a thing not just here, but it's global.
I think that's gonna keep the market alive for the next few months, I really can't say what could happen after that.
I've been watching 20+ properties around Austin, some out of genuine interest, others for a baseline. Zero of them moved in March and April despite asking price coming down every couple weeks. Now in the last couple weeks, 8 of them have had offers. I can't tell if they just dropped back into a "reasonable" range or some segment of the market has turned but it's fascinating.
My understanding is real estate was not essential here in Texas. Agents tried to do virtual showings but, come on, most people want to see a home before they submit an offer.
My anecdotal factor in Seattle is we have a set $/month in mind that is then tied to the price of the house. If a house will be more than $650k we can't afford it at this point, even with down payment help. If a house nearby falls to about $650k I'll walk over and check it out to build up examples of what is nice/not or what I like/dislike. The goal is to be able to buy next summer or the year after though so this is mostly experimental to gauge what is out there and identify what we'd like to buy vs pulling the trigger.
Yeah Atlanta had a similar "dip" period earilier, with many offers cancelled and investors on the sideline. Maybe the "reopen" gave people confidence? I'm afraid it is still too early to tell so I don't want to jump in too fast.
Home sales always peak when weather is nicer. As do leases for rentals. Leases that were ending a year from today are still ending, and some people are in a great place to buy a home, and inventory is incredibly low right now.
I sell real estate in Washington state. What you are describing has been our norm for a while. I am curious - is this a new phenomenon you are seeing in Atlanta? Is it at all price points and areas of the city? Would be interesting to see the data.
I'm not sure how it compared year-to-year, but at the beginning of the COVID thing, house prices did drop a little with quite some offers cancelled (even pending ones, according to some of my agent friends).
How do things look without using the questionable guidance of "asking price"? "Asking price" (and the notion of above asking) often seems like real estate agent reality distortion to me.
Mortgage rates are super low, so some may see this as getting an asset they can leverage in an improved environment later.
I mean listing price is the most direct measure of the market temporature, not saying it's 100% accurate but it does represent the sentiment. Mortgage rate is indeed low, but not that significant compared to before (< 1% compared to 6 month ago I think).
I'm hesitating to bid because 1) price is still high 2) unemployment benefits will run out in 2 months, and I do think teh COVID effects have a long tail, that takes time to pan out. Thus the curiosity about the thought behind the "hot" market right now.
It's also very location specific. Some areas listing too high will hurt you in the long run, so sometimes people definitely do what you're saying - price it low to get lots of offers hoping to get a bidding war. Other areas are much less tolerant of games like that - it's quite regional.
Readit News
These tenants are often not accepted by landlords because they're thought to cause more issues. Mine are great. They keep the units spotless, mow the lawn for me on my multi unit properties. When I have a tenant like this, I never raise their rent, and if they can't pay the hundred bucks the government won't I sure don't care.
Some counties even provide free legal help for landlords if their section 8 tenants do something bad. It's actually pretty low risk.
The main downside is the increased overhead of paperwork and inspections. The government wants to (rightly) make sure you aren't a slumlord so they do a lot more inspections.
High paid tenants seldom miss payment - I've setup automatic EFT withdrawal from their accounts, so I don't even need to process checks, and they aren't really impacted by the rise in unemployment right now - most just work from home.
I think the bitter spot for being a landlord (especially now) is to manage low-mid income units. ...it's just a constant stream of problems - people moving in and out - single mom's that chronically cannot afford the rent - unregistered tenants - people that refuse to pay and refuse to move out - drug and police raids... like it was a total total nightmare.
Managing 12 low-mid income apartments was a full-time nightmare. Managing 12 high income lux units now takes about 4 hours every other weekend and is usually a pleasure to do.
Of course it comes down to the people, regardless of the psychological incentives. But maybe the incentives promote some poor behaviors enough that its such a shared experience of poor behaving tenants.
I own an apartment in Rome that I rent because I don't live there anymore.
It's rented to a Bengali family that nobody wanted as tenants because they're immigrants and such (you can guess the reasoning behind it)
They used to bring the grocery home to my mother, so I gladly accepted to rent my house to them when they asked
They've been the best tenants I've ever had and due to covid they found themselves in the position of being one of the few local shops still open in the neighborhood, so their business didn't suffer much from the lockdown.
Many in Italy stopped paying the rent for 2-3 months as of now, but they always paid in time and in full, I asked them if they needed a cut on the rent to save some money, due to the bad situation, but they refused the offer.
So I'm installing air conditioning at my expenses in exchange
It's good when things go smoothly despites the odds
What a great story.
I used to have this same mentality. Until the person who was renting one of my properties decided to lie about certain issues (like claiming a shampoo bottle lodged down one of the toilets was there for years). When I decided to not renew the lease with that tenant, they decided to cause considerable damage to our property.
Sometimes, when things come easy to people, they don't appreciate it. Holding people accountable helps them lift themselves up too.
Your experience points to the human race sucking not poor people.
I think you have a very misguided idea of what it's like to live in poverty.
Surely the lesson here is that "this person was a criminally inconsiderate jerk", not "all Section 8 tenants are untrustworthy". (cr__ put it more punchily while I was posting: https://news.ycombinator.com/item?id=23409805 .)
> Sometimes, when things come easy to people, they don't appreciate it. Holding people accountable helps them lift themselves up too.
How does denying housing to someone who needs it help them lift themselves up?
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Yea I’m invoking Poe’s law on this coming from a landlord. Are you trolling?
I could never imagine this scenario. But I have a Tree Addendum I had drafted specifically because I don’t want my tenants to even lay a hand on the trees. I’m more worried by negligent tree trimming that kills a tree. But it sets value to each tree too. Something like “$1000 per inch diameter at 18” above ground.” Sorry about this situation you’re in.
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As a HUD-VASH veteran recipient in Los Angeles, I have hoped to discover that there are reasons to expand programs for more low-income people in the United States. I am EXTREMELY fortunate as a veteran to receive housing assistance. Thanks for making it possible for people in need to have a safe and affordable option! Blessings!
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It is a terrible outcome if millions of Americans are about to go broke and the relative winners are people who (a) totally rely on government handouts and (b) rely on people who are totally reliant on government handouts.
This story points to a situation where a rational person would rather be involved in ventures that produce less resources than they consume. That will really start to hurt the absolute measures of prosperity if it persists for long.
You're ignoring the potential effects on property value.
Bingo. Surprised nobody else brought this up. Not to mention the neighboring home/property owners are going to be pissed off because it's a potential drag on their property value. Though the stigma against section 8 may not even be warranted. I wonder whether there are any studies on the effects of section 8 on communities.
It'll be worse in downtown areas. I've heard from multiple firms that are looking at downsizing their expensive office space and continuing to allow employees to work from home. if a person doesn't have to work downtown they will often choose not to live there either.
COVID is going to change the face of urban real estate. So if you have a tenant, they're gold and do what you can to keep them.
https://www.theatlantic.com/technology/archive/2019/02/singl...
Edit: Also note this appreciation driven dynamic is something of a product of QE - printing money. As the treasury dumps money into markets, anything of apparently reliable value, "money-like", becomes more valuable - commodities and land being examples but the "best" companies also. This appreciation process becomes more important than the ordinary use of the object in the case of land (empty mansions in London being the prime example but we may wind-up with many more if the approach continues).
Let me guess, you have huge problem with the homeless situation, but are unwilling to consider lowering rents? Is that right?
https://fred.stlouisfed.org/series/RRVRUSQ156N
I would have guessed the lower rents were more about money drying up, and landlords being desperate to hang onto any tenant who can pay.
In many metro areas owner occupied real estate is overpriced relative to rents. When this imbalance corrects rents will rise, as before the correction owner occupants were subsidizing renters by overpaying for property even though renting made more sense.
https://www.bbc.co.uk/news/uk-england-52847319
I suspect that number is still a long way below normal, because lots of people are moving in with friends or family (students, young professionals, etc.).
My experience in London is the ratio of people looking for a house to houses advertised is the lowest I've ever seen in 10 years.
It appears Ford operates on the Google customer service spectrum of only helping those who can gain support of public outcry.
What I would like to see is a response from Ford that they will open an investigation to review everyones requests which have been denied for skipping payment.
Almost everybody is taking a haircut this year.
IMHO this is a really good idea while not giving money away due to each party covering a part of the deal.
The only businesses in that town that have been booming are retirement homes... but after this I assume there will be a lot of empty properties.
I haven't had a haircut since febuary. (cutting my actual hair) :)
Some of my friends look a little bushy too.
I've paid the lady who cuts my hair anyway, I've been seeing her forever and this is her only income.
It’s.. ok. Very short though.
One day, they'll be able to pay, and then you'll get paid.
I dunno though. It's a small enterprise that doesn't do a lot of business even in good times. I'm ok helping them out. It can be my good deed for the decade.
A high-margin business with low cash on hand, that's temporarily impacted by COVID is another story - they might be able to pay up later.
After June 30, companies that took PPP money are free to fire people without repercussion.
I'm waiting for a very large shoe to drop in a few months. How big will depend on whether consumers feel comfortable about their jobs+health.
The fed and congress have been very on point with the stimulus response speed this time around and so I think we’ve seen the bottom of the market through this. And most investors are voting with their dollars that this is true.
(I’m just parroting Ray Dalio.)
This is a very frightening sentence because obviously not many consumers feel comfortable about either right now.
I think a lot of people haven't realized that for many workers, being furloughed or having your hours reduced can result in an effective raise under the current Coronavirus aid package.
A friend's company furloughed everyone on Fridays. She was disappointed at first, until she realized this hours reduction qualified her for the $600/week Coronavirus aid. Now she's making more money, working less, and enjoying 3-day weekends.
Now everyone at her company is trying to convince management to continue the Friday furlough until the $600/week stimulus runs out.
This is why I don't trust the unemployment claim numbers until after July. Too many perverse incentives to increase the number of claims.
No new business was able to be drummed up and now massive lay offs of 90% of the US offices starting June 15 with a paycheck severance so effectively June 30. The EU offices have faired better with more work, and few layoffs of only receptionists.
All and all it’s bleak for the events industry. I’m sure that a lot of convention centers, caterers, AV rental houses, independent producers, PAs, will all be on the dole and you’ll see a huge spike in unemployment on Aug 1.
Lockdowns are/were intended to prevent jamming hospitals with COVID patients which would lead to non-COVID emergencies being put at risk.
The idea is to lockdown an area not to STOP, but to SLOW the trickle of new patients into hospitals at a rate they can be serviced: e.g., balancing the pipeline. In anticipation of the huge surges seen in the North East US, many hospitals built-out their capacity but didn't need it. Thankfully, and hopefully they will not.
As for "natural repercussions," the different phased-reopening plans that governors are drawing up all share the same thing: let's try opening a little, and if the cases shoot up again, lock down if hospitals are at risk of overflowing. We just don't have a national policy, it is patchworks of different state alliances.
It was the best idea at the time, and we all know the only other proposed solution was to NOT lock down and let those who are susceptible pay the price. Some people on the news vocally approved of that idea, most people did not according to surveys.
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NJ stay at home order continued indefinitely | FOX 5 New York https://www.fox5ny.com/news/nj-stay-at-home-order-continued-.... And many many more...
“Los Angeles County, which has recorded the highest number of coronavirus cases and deaths in California, has extended stay-at-home orders indefinitely.”
https://www.sfchronicle.com/bayarea/article/LA-to-extend-sta...
It's going to be very interesting going forward. The American public (myself included more times than I would care to admit) is really good about moving on and having a short-term memory on things (Lots of these things happened back in 1918 with masks, social distancing, lockdowns, people hating the lockdowns, etc). I worry what happens when you couple that urgency to move on with something that, from all indications, cannot be swept under the rug.
Flattening the curve was the refrain but we seem to have forgotten that.
Daily new infections have more than doubled here in North Carolina in the last two weeks since "reopening" [0]. We have had more new cases in the last two weeks (2200) than in the entire length of lockdown from March until then (2000). The death rate has massively spiked beginning May 24th, exactly two weeks (the median time from infection to death) from May 9th, the day the governor relaxed restrictions [1]. The dream of this thing just magically going away is absolutely delusional.
[0] https://www.nytimes.com/interactive/2020/us/north-carolina-c...
[1] https://www.nytimes.com/interactive/2020/us/north-carolina-c...
Also the increase in deaths you link to is not statistically significant, given it is in the rage of 10-30 over the course of several months in a state with 10 million people.
Those numbers don't prove your point.
With increased (including employment-related) testing, case count should be increasing everywhere, but some of those could be recovered or asymptomatic.
We know that most hospitals were well below capacity, so new cases can be treated.
Confirmed cases, not infections. The hospitalization numbers are about 30% higher or so which is about-ish how much new deaths have increased. Which is bad, but not 2x bad.
All said, NC may have one of the highest spike of any state (reopened or not). Texas and Florida have flat hospitalizations; Georgia is slightly decreasing.
Since we don't really know what's going on yet, almost anything that happens is going to seem kind of magical. Right now we're operating on guesswork and superstition.
[1] https://www.worldometers.info/coronavirus/country/us/
NC has only seen a slight uptick in hospitalizations: https://covid19.ncdhhs.gov/dashboard and it's been flat for the past week.
That's already happening. The current slow reopening is restarting the economy in order to help millions of Americans get back to work. For example, the jewelry store in my neighborhood in CA is now open, but for 1 customer at a time (OK in their case because even before the pandemic they controlled the number of people inside). However, the breakfast diner nearby with closely packed tables is still shut down. Even if they could open, the owner has to figure out how to run that business with appropriate social distancing.
An additional problem is that the economy was fragile even before the lockdown. Many employers likely won't rehire nearly as many people as they let go. Those who are still hiring have slowed down their hiring rate.
And until people feel safe consuming services and gathering in public like they did before, the main street economy can't recover fast enough to employ everyone who was laid off during the lockdown.
This is why government support for laid off workers must continue until enough confidence exists that things are safe, even without the lockdowns, and that might take years for some sectors of the economy.
However...it appears that new infections have been rising again globally since May-ish. It looks to me like it is becoming exponential again, although the slope on a log scale is considerably less than the first time.
This is my interpretation of the charts at: https://www.worldometers.info/coronavirus/
...titled Daily New Cases and Daily Deaths.
Deaths still seem to be declining, but you would expect that to lag regardless.
There seems to be a pattern where the larger countries that weren't hit so hard at first are picking up as developed Europe gets things under control. For instance, India, Brazil, Russia, Pakistan etc.
And within the US, as NY and NJ have fewer new cases, Texas, California, Illinois, and Arizona are starting to take the lead. Over 90% of new cases are outside NY and NJ now.
[1]: https://kubrick.htvapps.com/htv-prod-media.s3.amazonaws.com/...
[2]: https://boston.cbslocal.com/2020/06/02/george-floyd-protests...
[3]: https://www.wcvb.com/article/new-group-of-watchdogs-begins-i...
I think there will be massive economic damage in 6 months that we aren't focusing on right now.
My wife started a co-working space January this year, it was her office and the co-working bit was to save on the rent with a prediction of some profit in a year or two.
Then covid happened, so we gave our notice to the landlord and are looking for a bigger house, with a spare room she can use as an home-office
We're saving money from the office rent and investing them in a less potentially profitable solution, but safer, at least for the moment.
Apparently this is a thing not just here, but it's global.
I think that's gonna keep the market alive for the next few months, I really can't say what could happen after that.
Your observation does not deviate notably from typical market behavior.
Mortgage rates are super low, so some may see this as getting an asset they can leverage in an improved environment later.
I'm hesitating to bid because 1) price is still high 2) unemployment benefits will run out in 2 months, and I do think teh COVID effects have a long tail, that takes time to pan out. Thus the curiosity about the thought behind the "hot" market right now.
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I assume if prices drop, they won't stay low for long as people see it as an opportunity to jump into the market.
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