Increase everyone's rent at the same time?

[steppinthrax]

I have a townhouse in a neighborhood of Maryland that I would general describe as low-middle class income area. Most of the occupants that own and those that rent are mostly comprised of service workers and wage workers that are mostly paycheck to paycheck. The average rent price reflects this as well as the general area.

Interesting a lot of homeowners have rented out their unit and no longer live there. I have an idea to setup some sort of meeting with all of the landlords and negotiate a widespread rental increase. Everyone will increase their rent at the same time or roughly during the lease renewal period.

As a result it will cause current tenants to move out and/or attract higher income residents. This will increase the overall upkeep and the higher rents will motivate landlords to perform higher end upgrades to their properties to appease higher income tenants. This will cause a surge in property values. It will also cause current homeowners to move out because things will become expensive. As a result homeowners can end their leases and sell their properties getting a high profit.

This will be something like a 5 to 10 year plan? What do you guys think?

 

[waffleironhead]

Sounds like a price fixing lawsuit in the works. Have at it.

 

[lxskllr]

Sounds like price fixing. Not sure that's legal.

 

[Rakehellion]

That sounds pretty illegal. Go right ahead.

 

[Rakehellion]

If you want to make more money, raise the rent. If someone moves out, renovate and raise the rent again before getting another tenant.

Your cause/effect situation is a little wishful.

 

[Red Squirrel]

Is price fixing even illegal? Why can ISPs and the oil companies do it? Oh right, they lobby with the government.

Also by how much are you raising it? People are not going to go through the trouble of moving out over a few hundred bucks. Now if you raise it by like a grand, then probably they will if they can find a place that's cheaper.

 

[phucheneh]

Raising rent prices does not make a 'higher income area.' It makes vacancies.

 

[Greenman]

I have a townhouse in a neighborhood of Maryland that I would general describe as low-middle class income area. Most of the occupants that own and those that rent are mostly comprised of service workers and wage workers that are mostly paycheck to paycheck. The average rent price reflects this as well as the general area.

Interesting a lot of homeowners have rented out their unit and no longer live there. I have an idea to setup some sort of meeting with all of the landlords and negotiate a widespread rental increase. Everyone will increase their rent at the same time or roughly during the lease renewal period.

As a result it will cause current tenants to move out and/or attract higher income residents. This will increase the overall upkeep and the higher rents will motivate landlords to perform higher end upgrades to their properties to appease higher income tenants. This will cause a surge in property values. It will also cause current homeowners to move out because things will become expensive. As a result homeowners can end their leases and sell their properties getting a high profit.

This will be something like a 5 to 10 year plan? What do you guys think?

The only way you're going to drive up the market rates on those units is to make them more desirable, or maintain near 100% occupancy. The only way to price fix is if you control the entire market.

 

[Rakehellion]

Is price fixing even illegal? Why can ISPs and the oil companies do it? Oh right, they lobby with the government.

 

[Captante]

Go to it. What could possibly go wrong?

 

[Fritzo]

 

[Ferzerp]

I know when I plan to violate the Sherman Act, I confess on the internet before I even do it!

 

[Markbnj]

'Gentrification' seems to me to be a more organic phenomena, and I doubt you could lead with higher rents. In fact I suspect rents are the tail of the effect.

 

[Ichinisan]

Price fixing?

 

[CZroe]

Price fixing?

This. Expect to get reamed by RICO. Reporting OP to the authorities now.

 

[alkemyst]

In general, rents do rise and fall together when supply/demand dictate it.

There is no way to turn a ghetto in to a high-class neighborhood without doing more than just bumping rents up.

 

[NetWareHead]

There is nothing wrong with doing market research and setting up a meeting with nearby landlords. In real estate and rental industry, it's common for sellers to compare properties so they can set the best price as well as for buyers to compare perspective properties so they can determine the value of what they plan to buy.

Raising rent prices does not make a 'higher income area.' It makes vacancies.

This. You need to have something that will justify the increase in rent. You can improve the amenities but if the neighborhood is still shit...that is your money being wasted.

A blanket "lets raise the rents in this neighborhood" decision with no corresponding increase in value will fall flat on its face. Tenants are not as dumb as this and wont pay the extra rent. Considering the amount of landlords, amenities in each unit and varying locations, such collaborative activity is highly unlikely. Now, one thing that could work is if all the landlords in a neighborhood got together and all agreed to, for instance to beautify the neighborhood, that would produce a real increase in property value and deliver real results.

 

[Mixolydian]

Why don't you just move to a nicer area?

 

[DaTT]

In general, rents do rise and fall together when supply/demand dictate it.

There is no way to turn a ghetto in to a high-class neighborhood without doing more than just bumping rents up.

I agree with this statement. You'll have an upper class ghetto.

 

[sao123]

Raising rent prices does not make a 'higher income area.' It makes vacancies.

I play Sim City all the time... this man speaks truth.
:whiste:

 

[Capt Caveman]

I have a townhouse in a neighborhood of Maryland that I would general describe as low-middle class income area. Most of the occupants that own and those that rent are mostly comprised of service workers and wage workers that are mostly paycheck to paycheck. The average rent price reflects this as well as the general area.

Interesting a lot of homeowners have rented out their unit and no longer live there. I have an idea to setup some sort of meeting with all of the landlords and negotiate a widespread rental increase. Everyone will increase their rent at the same time or roughly during the lease renewal period.

As a result it will cause current tenants to move out and/or attract higher income residents. This will increase the overall upkeep and the higher rents will motivate landlords to perform higher end upgrades to their properties to appease higher income tenants. This will cause a surge in property values. It will also cause current homeowners to move out because things will become expensive. As a result homeowners can end their leases and sell their properties getting a high profit.

This will be something like a 5 to 10 year plan? What do you guys think?

OP thinks he can gentrify the area by raising the rents of his townhouse complex? LOL!

 

[alkemyst]

I am betting the OP is ready to buy a unit or two to profit from this idea,

 

[Dr. Zaus]

OP: this is not illegal and is a very good business idea if the rest of the neighborhood is becoming more gentrified. But if not, then it'll never work. Further, since most owners are likely lazy asses; the probably of this working (despite the potential profits) is low.

But if everyone is in it to win it then getting together to gentrify the neighborhood more generally would be a good investment.