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Re: Typical rent increase
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Home away from home
 
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I seem to recall there are often all sorts of problems with actually getting those lower income units on the market and to the people that needs them. Just like in JC real estate, what's drawn is often different from what's delivered, and enforcement is lax. Either way, it's not building a stabilized rental building, they've traded those apartments for profitable variances. The trauma of moving is the friction in the system. Some people think nothing of moving, others will do anything to avoid it (I'm of the latter). All systems of trade need a little "friction" to avoid chaos, witness how out of control Wall Street has gotten with technology eliminating friction to the point where hi frequency trading is draining the system of equity at no benefit to anyone but the banks. Also, while it costs a tenant cash & hassle to move, it costs a landlord to freshen a place and often lose a month or 2 of rent. And if you're a good low hassle tenant, a small landlord is even more reluctant to risk you moving. Bottom line is a good landlord also values his tenants and doesn't view it as adversarial. I'm so glad I'm not in the position of an old landlord of mine in Manhattan who would only replace the broken stove is we agreed to a rent raise of 1/40 the cost.
Posted on: 2011/8/17 17:42
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Re: Typical rent increase
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Home away from home
Joined:
2008/10/19 1:18 Last Login : 2020/9/25 20:40 From somewhere else
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Except that most (all?) new construction in NYC has a set-aside for a certain - not insignificant - number of apartments for low/moderate income tenants. I don't know the percentage. It seems fairer to me than blanket rent control and it also promotes, at least somewhat, a greater mix of people in a neighborhood. As for the markets at work with regard to the tenant who moved out of a big building because of a large rent increase and is now happier in her smaller building - I'm happy it worked out for them. But to say "the market works" isn't exactly fair - moving sucks. Everyone knows moving sucks. And no one knows moving sucks more than a landlord. I'm sure the landlord can get away with a few extra percentage points in an increase because of the hassle of moving. No slight intended to landlords - thinking about becoming one myself. I just wouldn't say it's a perfectly level field when it comes to negotiations with an existing tenant.
Posted on: 2011/8/17 17:04
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Re: Typical rent increase
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Home away from home
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No one in their right mind has ever built new construction that would be rent controlled. NY rescinded the exemption for postwar buildings in 1969, and no one has built rentals that would rent low enough to fall under rent laws since. How is that a middle & lower class win? And 2 or 3 units structures do not fall under rent laws anywhere. Quote:
Rent laws virtually guaranteed the neglect and abandonment of structures during decades of urban economic decline, a far longer period than the recent rapid appreciation. Why would you invest more capital in a property where the cashflow is fixed? Quote:
I find the linking of zoning to rent laws a stretch. Most of JC is R1, a designation that excludes rent control eligible property. It benefits smallholders far more. A commercial rental owner would welcome a large development next door, it would raise his land value tremendously, and perhaps tempt him to arson, a common tool of landlords in the 70's. Quote:
True theoretically but not in practice. I've seen numerous listings of rent control places that are ridiculously overpriced for their rent rolls, making them attractive only for condo speculators not rental operators. As I said, it creates incentives to the unscrupulous who would realize great profit by emptying and flipping it as condos.
Posted on: 2011/8/17 16:32
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Home away from home
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I might agree that some kinds of rent control laws are problematic. The distinction between New York's rent control and rent stabilization is for one example two very different systems with similar objectives. The burden of rent control on a smaller landlord is also greater than that of a larger landlord. And depending on how the rent control laws are written, rewards high turn over which is precisely what rent control is intended to prevent. Jersey City's rent control laws are problematic because they have shifted the burden from large landlords to small landlords. The new construction along the water and in redevelopment zones is exempt yet buildings of this scale are exactly the size that can operate under a system of rent stability. The landlord with two or three units in a building, I would agree, is shouldering a disproportionate burden. However, a well written rent stabilization law encourages reinvestment in a property, stabilizes a community during periods of rapid property appreciation, and balances the interests of a tenant and landlord. That is, the landlord wants to preserve property values which is theoretically accomplished through zoning restrictions (ergo zoning prevents the free market from building a 40 story apartment building in the 20 foot lot next to your brownstone, even if the market forces would support that) and in return the tenant theoretically has access to more affordable housing. Finally, to suggest that the burden of rent control falls to an individual landlord is a false statement. Rent controlled properties' property value reflect the generated revenue; a rental unit with controlled rents will have a lower initial capital cost than an uncontrolled unit.
Posted on: 2011/8/17 13:48
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Re: Typical rent increase
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Home away from home
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Wow, your hypothetical landlord is making off with a whole $400 a year!! Get the pitchforks and torches and lynch the rapacious scum!! Geez, that $400 can be blown just by a tenant not telling you the damn toilet is running till you get a whopper water bill. Lose the idea most small landlords make operating profit. Even at today's short sale prices and record low rates, most JC rental properties for sale barely cover their mortgage, taxes and expenses. It's not a living, it's a retirement.
Posted on: 2011/8/17 3:30
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Home away from home
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Did you ever think you might be a little to intelligent for this forum? I mean trying to decode half of your posts makes me feel like I should just go back to wearing diapers.
Posted on: 2011/8/17 2:43
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Re: Typical rent increase
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Home away from home
Joined:
2005/7/13 15:03 Last Login : 2023/6/11 23:48 From Western Slope
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Owning an apartment building in J.C. If you can only raise the rent by 4% on a 5 family charging a grand a month that is a $40 a month hike taking in $200 more a month which a $2400 a year. The taxes went up 15% in 2010. I would like to research 5 family apartment buildings and see what their assessed value is. Even it is 200k with the 15% hike the landlords are still making $400 a year.
Posted on: 2011/8/17 1:52
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Re: Typical rent increase
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Home away from home
Joined:
2005/7/13 15:03 Last Login : 2023/6/11 23:48 From Western Slope
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Perhaps it is time you landlords start reading the classified ads and keep up with the times. Then you to can have a finger on the pulse.
Posted on: 2011/8/17 1:38
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Re: Typical rent increase
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Home away from home
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Rent control doesn't balance negotiations, it eliminates them, and gives a lucky tenant the eternal right to rent for under market. It's a social benefit that, unlike Section 8, has no means test, nor is borne by society at large via taxes, but by 1 property owner. It's like as if the cost of the food stamp program had to be borne by the grocery stores as the price of being in business.
Posted on: 2011/8/16 20:54
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Home away from home
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Except that there is not such thing as a free market. Tax incentives, building restrictions, zoning and historical capital distribution all play on demand as well as supply. Rent control (or rent stabilization) are tools to balance the negotiations.
Posted on: 2011/8/16 20:26
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Re: Typical rent increase
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Home away from home
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There's beauty of the free market at work, rather than the cage death match of rent control. That said, we small private landlords are often out of touch with what the current market prices are, while the management Co has it's finger on the pulse!
Posted on: 2011/8/16 20:10
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Re: Typical rent increase
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Home away from home
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New Jersey law prohibits unconscionable rent increases. The law does not define unconscionable meaning the definition is ultimately up to a court to decide.
Any rent increase can be deemed unconscionable by a court depending on the circumstances. But often 10% tends to be a good indicator something isn't quite right.
Posted on: 2011/8/16 19:54
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Not too shy to talk
 
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We lived in a large apartment building in Paulus Hook and they wanted to raise our rent about 13%. We left and rented a row house in the same neighborhood for around the same price. In my experience, private landlords are much more reasonable then management companies.
Posted on: 2011/8/16 19:12
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Re: Typical rent increase
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Home away from home
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There are many factors a landlord takes into account prior to raising the rent. If heat and hot water included - fuel costs in the past few years have increased exponentially. In addition, in the past couple of years, property taxes in JC have increased >10% percent per year. So, if the rent was covering the landlords costs a year or two ago, may not be the case anymore. Most often, tenants jump to the conclusion that the landlord is just trying to make more money but most often that is not the case.
providing the percentage is misleading. An increase of 6% may be high but it really depends how much 6% equals to in dollars. Six percent increase on $1500 rent is not bad, but I can see it to be an issue if it's 6% of $3000.
Posted on: 2011/8/16 18:13
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Just can't stay away
 
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Only as the increase approaches 10% do you have a legal justification for refusing.
If the building is a 4-family and under, the landlord can charge you what he/she wants. If the building is 5-family and above, then it's subject to city ordinances regarding rent increases. If apartment is rent stabilized, then the base rental rate is set by the city and the landlord can increase it generally up to 4% for cost of living, more for "financial hardship." However, this excludes newly constructed dwellings with 25 or more dwelling units located within a redevelopment area. Rent control is a completely different program where the rent is actually set by the city. Very few people have this and I don't even think Jersey City has it, I know NYC does.
Posted on: 2011/8/16 18:05
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Home away from home
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I hadn't heard that before. On what are you basing it? I thought this fell under the subjective "unconscionable increase" clause in the state law.
Posted on: 2011/8/16 16:13
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Re: Typical rent increase
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Home away from home
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Make a counter offer that's less than 6%. Only as the increase approaches 10% do you have a legal justification for refusing.
Of course, some Jersey City apartments fall under rent control laws. Read up on the municipal code here: http://library.municode.com/index.aspx?clientId=16093
Posted on: 2011/8/16 3:23
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Typical rent increase
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Newbie
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My landlord wants to increase our rent by 6% since our lease is up. My roommate and I have been here a year and really like it and our apartment, but after checking out what other apartments in our area are going for, I don't think the rent increase is justified. What we are paying currently is on par with what similar apartments in the area go for.
Anyone willing to share their experiences with rent increases in JC? I would expect it in NYC, but wasn't sure how typical it is in JC and what the common increase in % is. Thanks!
Posted on: 2011/8/16 2:04
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