Predatory Investors

By necessity,  some of your expenses may be funding neighborhood businesses that create negative Jawnnies.

On average,  rents for most urban dwellings are inversely proportional to the market value of property that is located in the city’s best neighborhoods.

Monthly rents in those neighborhoods are usually between one and two percent of the building’s market value.  A one million dollar condo will rent for $10,000 to $20,000 per month.

In less desirable neighborhoods, rents are most often based on what the market will bear. For a full time,  minimum wage worker,  that amount is approximately $500 per month for a single room with a shared bath and kitchen — Almost half of their income.

Most landlords in these neighborhoods are small investors who are doing the best that they can. But many others get by with such a small amount of basic maintenance that they drain the value out of the property,  literally destroying the value of neighboring row houses.

The return on investment for these predatory landlords can be excessive from the market value rents that they charge.  Their practices are also a root cause of street violence.

No one can, or should expect a business to charge less than the market value for an item or a service. But they should deliver an acceptable level of value for every sale they transact. For landlords, that includes basic or renovated maintenance.

The Ugly    |   The Bad   |   and The Good

Landlords

 

Ugly” landlords rent sub par structures without maintaining or improving them.
Bad” landlords make an effort, but still over-charge for sub standard housing.
Good” landlords maintain their properties and treat their tenants with respect.

 

 

 

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