My renters bought and paid for my houses several times over... I had paper losses on real income every single... I for one have never owned a property that didn't do better than break on the very first year... I lived in and owned properties that...
well, that is great that you personally have had a good experience as a landlord in the past, but i am not talking about your personal experience in the past.
i am talking about the entire country, right now, today. in many, many parts of the country, you can rent for a fraction of the cost of ownership. there is no magical law that says renters always get a bad deal.
f rents are subject to what the market will bear so is the availability of rental supply.
not in the short term. all the people who read those retarded Rich Dad Poor Dad books and bought houses that have cash on cash rental yields of 2% before taxes or anything will never come out ahead, no matter how much they depreciate and work tax free. a lot of those landlords will go BK because their business model is not sustainable, but that process takes years, and the liquidation is being delayed by this and that program now being put up by the govt to delay the inevitable.
the "inevitable" here is the resetting of housing prices to levels where landlords can buy them and rent them out profitably (using whatever machinations they normally do). yes, i know there are areas here and there where this is already possible, but those are mainly armpit areas. the desirable areas, prices are still way too high so it is better to rent.
Maybe the reason you think there is so little profit in rental property is because
no need to put words in my mouth. i actually understand how the whole landlord thing works.
with depreciation and all.
and "sweat equity".
and having deadbeat tenants that you can't evict for a year, and then they come throw bricks through your window.
and running lawsuit risks because somebody feels like suing you.
hopefully these and other bad things didn't happen to you, but they certainly happened to other landlords who were just as careful and capable as you.
because renting to individuals is like junk bonds: sometimes you get a dud.
in any case...
because most REITs and professionals actively manage their properties in such a way to eliminate taxable profits?
well, i don't know about "professionals", but my understanding is REITs don't try to "eliminate taxable profits". after all, the main purpose of the REIT as a legal structure is a pass-through vehicle whereby profits are not taxed at the trust level, but are taxed at the recipient level, as long as the trust passes along like 90% or whatever of profits or "FFO" or whatever every year.
is my understanding. |
