Does anyone remember that show from Canada where they would renovate a basement and then rent it out?
I am starting to seriously think I should do that with the kids leaving soon.
Biggest problem would be parking. My subdivision doesn’t allow street parking from 3AM-6AM.
It’s actually good news compared to the alternative here in CA, where Proposition 13 means property tax rises are capped and so home prices rise well beyond the level of affordability for our kids. If tax rises cause enough people to sell them it will keep prices from rising further.
Why is that a problem? You want retirees on Social security or fixed income to lose their homes so young kids can afford them? One of my kids actually make more than we have in income.
God forbid, we stop caring about retirees! Maybe we should make rent more affordable? Could it be that we are obsessed with homeownership? I’ve heard in some countries like Germany, most people rent…of course our system will probably never change.
Home ownership rate chart, it’s never 100%
Home prices have been rising in CA for many reasons, including low interest rates, corporations buying up properties, dot com money and limited supply.
My parents were landlords for many years. They hated having to raise rents on established tenants but in the end, that was what was helping to put food on the table and send us to college. Most landlords use that rental income to live by and aren’t doing it as a charity. As taxes, insurance, and utilities rise it’s a necessary evil to pass along some of those costs.
My D is lucky that one of the folks who lived in the rental house with them decided to buy a house that they could all move to and share. They get along well and don’t worry about any arbitrary increases in their rent.
My parents were landlords for many years. They hated having to raise rents on established tenants but in the end, that was what was helping to put food on the table and send us to college. Most landlords use that rental income to live by and aren’t doing it as a charity. As taxes, insurance, and utilities rise it’s a necessary evil to pass along some of those costs.
Not to derail this post, but this is an example of people paying taxes indirectly. Every time taxes get discussed people will say low income people don’t pay enough taxes. I will say sure their state/federal income tax is low, but renters are the ones that pay the property taxes on property not the landlords. Landlords are just the ones remitting the funds to the government.
And during recessions, typically rents go down, but few renters complain about their rent dropping then. 
Or when landlords have to absorb their rental expenses when units are vacant.
During recession renters lose their job. I think the unemployed are worse off than a landlord with a 75% occupancy rate.
In major cities, right after Covid hit, apartments were hurting for tenants. Tons of renters moved out of high rent cities and WFH at their parents or in a suburban location. My kid moved the weekend before everything shut down. They picked a great urban apartment with a lively atmosphere, pool and gym on premises. All shut down, they were stuck WFH in the apartment.
Some places were lowered rent to attract tenants. But now the pool has reopened, so has the gym. The bars and restaurants are open. Rents had to go up, people want to move in. And people are going back to the office. And the landlords expenses went up.
I know that my kids were offered a good rate the first year with a increase on renewing.
And landlords can and do file for bankruptcy or have their properties foreclosed upon, when times are tough.
My main point was not to compare who’s worse off, but that it’s not always “roses and rainbows” for landlords either.
Whether you own or rent, you are covering the cost of owning the house. If you aren’t and you own it, you will lose it. If you aren’t and you are renting it, your landlord will lose it and you may be looking for a new place as well.
Rent goes up as housing prices, energy prices, employee salaries and so forth are going up. Landlords are not charities, they’re business people. They have mortgages, taxes, utilities, insurance, licensing fees, upkeep and maintenance to pay for and they have a right to make a profit just like any other business. The fact that the government decided that landlords should be charities and allow tenants to live rent free for over a year is also contributing to rent increases.
ETA: didn’t mean to respond to @natty1988 just the thread.
In New York, tenants could apply to get their rent reimbursed. The program was funded by Covid relief funds from the federal government.
@oldmom4896 there was rental relief that could be applied for during the height of COVID. BUT that does not take the zing out of rent increases now. My kid’s rent went from $750 to $950 in 2020. And he didn’t mind because it was still a good value. But then for 2021, the rent was increasing to $1350. So more than double since 2019. That is a huge increase. And that’s why he bought a town house. He would have preferred a house, but those prices were not in range for him.
His townhouse is nice. It’s older, but has more room than his apartment, a pool, a nice courtyard area, a private patio…and the cost per month is less than what he was paying.
There’s one in NYC. Sometimes it works. Other times it’s a disaster.
My understanding is that the roommate signs an agreement that the money paid each month is a sharing of expenses, not rent. No matter what is signed, some young people will claim it’s rent. It’s very hard to evict a tenant in NYC; right now it’s just about impossible.
So if young person stops paying–maybe even due to genuine difficulties–it’s hard to evict them. So the older person doesn’t get the money expected. Sometimes the younger person engages in conduct the older person dislikes. It’s legal to smoke pot at home, for example. But not everyone wants the odor of pot in their home. Or the younger person invites a lot of company, plays loud music, etc.
So, doing it is very risky.
S1 had roommates for eight years so he could save. He doesn’t drive, rides a bike or takes the light rail to work, so his transportation expenses are fairly modest. He’s not a big spender in general.
Bought a SFH in San Jose in July 2020 for under asking price. He was 29. Put down a decent down payment and got a fabulous loan rate. Guess he’s staying in CA for a while!
OTOH, H and I were 37 and married 14 years with two elementary school kids before we were able to buy our first place. Student loans, day care and DC-area rents ate up most of our income. Was also home FT for a couple years with kids 15 mo apart, so lost income there, too. Still in the same house; love that small payment. Will be paid off by the end of the year.
What is a SFH