Renting houses is becoming much more popular. This may be because the process is reasonably easier than purchasing a house, and having to access a loan and then pay off a mortgage. Some house owners, however, don’t want to deal with the potential hassles of becoming a landlord. That’s why some people contact companies to rent their house for them. So why should I hire someone to manage my rental property? It would mean that the owner of the house doesn’t have to chase up payments or deal with emergency maintenance situations because the rental company should do that for you. However, some people are more than happy to rent out their homes themselves.
According to a Freddie Mac commissioned Harris Poll of around two thousand adults, a third of which were renters, the top five favorable factors for renting versus owning a home are:
- Provides freedom from home maintenance responsibilities. The landlord is the one who has to contact people like austin roofing companies when something goes wrong with the house, not the renter. So in the long run if you are renting your house you will not have to worry about any maintenance repairs that are needed at all, this should also stay true to who should have to pick up the repair costs if the damage was not your fault, so you won’t have to worry about thinking whats the cost of a plumber for simple repairs or other maintenance costs.
- Allows more flexibility over where you live. You don’t have a mortgage to pay off so you can move from house to house if you need to. If you wanted to up sticks and move, you can simply contact an Estate Agents Coventry, see their available properties and make the preparations to move in without being tied down to a single home.
- Protects against home price declines. Renters don’t have to worry about the property value or the housing market because they have an amount they pay to the homeowner per month.
- Less stressful than owning, and
- Makes it more affordable to be closer to a major city and the “action”. Although people should contact a local realtor, such as Eddie Yan Vancouver realtor, to go through their options in depth.
At the same time, according to those renting, the top five favorable perceptions about home ownership are:
- Something of which to be proud
- Can be passed on to your children
- Allows more flexibility to design the way you want
- Provides more privacy, and
- Protects against rent increases
The age range of the renters who were most likely to indicate an expectation of purchasing a home in the next three years was 35 to 44, with those 65 and older the most likely to continue to rent despite being the most financially stable. Also noted, 62 percent of those who are currently renting reported some type of financial “hardship,” such as having just enough money to get by each month, and 38 percent of current homeowners indicated the same.
#1 in SF: Rent Control!!!
Rent Control makes the people of SF become lifetime renters and lost their American dream of home ownership. It is a sad tragedy which tenants do not realize.
Even with rent control, tenants can still be evicted when they are least prepared for it. SF’s board of supervisors have committed major crime to tenants by giving out rent control and deprive the people’s American dream.
One day, tenants will wake up and throw the rent control supporting supervisors to the garbage can.
@BetterSF–Thanks for telling people who may prefer to rent for any of several good reasons that they are failures if they don’t achieve the “American dream of homeownership.”
No tenant in a rent-controlled apartment has ever been prevented from buying a home on account of benefiting from rent control.
You may have financial reasons to oppose rent control, but don’t expect renters to carry your water for you.
I agree. I hear of so many evictions – including one that may affect a family member – and am glad I have a home that I have more control over. I think too many people in SF rely on rent control and do little to save for a home or an emergency. Eviction day comes along and now they are faced with $3000+ rents, which is more than I pay for my mortgage and property tax each month. Being a life-long renter is a choice that can be fine, but I think the market in SF is too skewed to promoting that. It’s no wonder there are regular spasms of population turnover whenever there is a boom.
@catchaclue: good for you that you pay less then $3k/month in mortgage and property tax. Let’s do a calculation based on $3k/month. If you’d buy a modest $800k home, you’d pay $783/month in property tax (1.1743%). For the remainder ($2217/month) you can get a $465k loan 30-yr fixed 4% interest, assuming interest deduction at the 28% tax bracket (income around $200k/yr). That means you need to plunk down $335k in cash, which may appreciate, but so does an investment portfolio. On top of that, you’d have maintenance cost.
If someone is currently renting under rent control for less than $3k/month (not uncommon, assuming you’ve been there for 3+ years) and there is enough space, it’s not very appealing to buy. And on top of that, $800k doesn’t buy very much today.
This is pretty much my situation (3br apartment @ <$3k/month, $300k in investments, 28% tax bracket). The only reason for me to want to buy is to get a single family home. Renting a SFH is too risky because the rent can go up like crazy without rent control. However, a SFH of similar size as our apartment in the same area is $1.2 to 1.5 million. That is currently out of reach financially.
And regarding evictions: out of over 200,000 rental units in San Francisco, there are just over 500 no-fault evictions per year, a 0.2% chance of being evicted. I'll gladly take that chance.
With rent control, it is much cheaper to rent than buying. Many tenants are delighted to live in a rent controlled apartment for a very low cost. With the false information, many tenants think that the low rent will last a lifetime. However, nothing is guaranteed with the tenancy. People can lose the low rent from rent control for many reasons. Once they are faced with the market rent which they always ignore and regards market rent as if it was in another world, they’ll be shocked and they can not survive in a market priced housing market.
I read stories about senior citizens losing the rent controlled apartment and begging the people of SF and politicians to help them survive. It is the fault of rent control which make these senior citizens living in the unreal world of very low rent under rent control. They all had the opportunity to work hard and buy a place when they are young, however, rent control deprives tenants of the motivation to work hard and to plan their future.
glaucon, I think that your argument ignores the upside potential and you only focused on bottom line. With rent control, you do get a low rent. However, you lost the potential capital gain from home ownership and you lost the opportunity to lock your housing cost forever. Tenancy is temporary and you my face the market rent when you lose the rent control.
Renting with rent control is like shorting a stock. Your maximum gain is the price you shorted at. Buying a home is like long a stock, its upside potential is unlimited. If you rented 30 years ago and continue to get $1500 discount per month from rent control, you got $18k per year from your landlord. In 30 years, you get $540k from your landlord, seems a fantastic figure.
However, if you have bought a house 30 years ago, now you have paid off the house and will have no mortgage payment. Plus, your house is now worth $1.5 million.
When you compare renting for 30 years with rent control vs buying a house, you actually lose out $1 million by renting at a huge discount. This is exactly why I think that rent control has caused huge damage to many long time San Franciscans. It is sad that every rent controlled tenant think that it is such a wonderful thing to get a low rent, exactly when they are losing out financially every time they are paying a below market rent.
@BetterSF some people plan, some people don’t. People who don’t are in trouble when they can’t afford their adjustable mortgage anymore, or when they lose their rent controlled apartment. People who plan will be okay either way. I just don’t see how it relates to rent control.
Majority of the people are lazy and the majority of the people do not plan unless they have to. With rent control, most tenants only plan for the controlled rent, they do not plan for market rent.
In 1994, Massachusetts passed the “Massachusetts Rent Control Prohibition Initiative”. Overnight, rent control disappeared in Massachusetts. If this happens in California in a few years, how many of the San Francisco tenants are preparing for that moment?
It is amazing that “good investment vehicle” did not even crack the top five reasons to own. Passing the property on to your children and protection from rent increases allude to the investment potential but don’t explicitly
I was thinking the same thing…
Well this poll was nationwide, where 80% of properties barely appreciate with inflation. I’m sure a Bay Area poll would reflect future appreciation value.
6 – Never having to deal with the bank again!