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Absent units don’t pay the mortgage either. It’s not like there’s a glut of buyers out there that your tenant is blocking you from.


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Tenants are not paying for your mortgage. They are paying for a habitable home. If you cannot provide that product, then you cannot charge for it - it's pretty simple.

Non-paying tenants is just a short-term problem and you can put a dollar amount on it. It's not the worst thing that can happen to a property. People with deeper pockets than you and able to wait it out would still buy with the right discount for the inconvenience and uncertainty. Or even for the mere right to be your buyer - there's extreme housing supply shortage in certain markets if you haven't been following the news. With some comical extremities like people pledging to name their firstborn after the seller etc

Couldn't the absentee owners just rent the properties out to dodge that?

exactly, no one is forcing landlords to own units they can't fill

I don't understand your point at all. What's an absentee landlord in your book? A landlord who doesn't live in the place they are renting out? I would assume that's - all of them?

Lots of landlords don't pay any of those things.

The vast majority of the cost of having a tenant is the MORTGAGE you're paying.

Which you have to pay regardless of whether the unit is occupied or not.

So the actual situation is FAR worse than what I estimated.


There is no tax benefit to leaving a unit vacant, despite people who don’t understand real estate constantly making this claim. You do not get to deduct the rents you failed to collect, and there is no tax benefit that is lost when you rent the property. It never makes sense to refuse a dollar because you’ll have to pay 30% tax on it, or whatever. There may be other factors leading your friend to keep his property vacant, but this isn’t one of them.

The last paragraph sounds like nonsense too, though I’m less sure about that. What mechanism do you think there is for the mortgage holder to see your leases? And how stupid do you think banks are, that they’d rather your property bring in zero than less than they were expecting?


Because without landlords there's no place to rent. People don't seem to comprehend the fact that if it's not profitable to run an apartment, then those units are going to be taken off the market.

What's the proportion of commercial landlords that have a mortgage to pay? Because when their building is already paid, interruption of rent isn't really impacting them.

Obviously there will be some time between renters where units will sit vacant, but that's not the issue. Units are vacant because landlords don't want to rent them out for various reasons. Totally different situation! So, during this housing crunch units sit vacant and very little supply is being added. Sure, owning property means they're allowed to do whatever they want with it (within reason), but we're also free to complaint about the situation.

As to why landlords leave units empty; rent control. Rent control and strong renters protections, combined with dramatically increasing market rate, means landlords will get more money if they keep a unit empty for a year.


Why would the property owners rather have the units sit empty than rent them out at market rates?

I actually know a few homeowners in San Francisco in this situation right now. They have extra units in their building (which is also where they live), and choose to leave it vacant rather than deal with the hassle of rent control. They do not need the income and would rather not bother with possibly getting a tenant who never leaves. It's not economically rational, but people are not always rational, especially when dealing with their homes.

The building I live in is also in the situation currently where a unit is being left vacant in anticipation of a condo conversion in a couple years.. San Francisco has a very complicated condo conversion law but part of it is that during conversion some existing tenants have to be offered lifetime leases which can never be increased. Leaving units vacant is a rational way of dealing with that.


I wouldn't normally think of absentee landlords as the central example of a homeowner. Where do you live that the majority of housing units are owned by absentee landlords?

Keeping properties empty is almost never more profitable than keeping them occupied. If rents are falling such that they're not sufficient to cover the mortgage payments, that's usually a sign than property prices are about to go down, not up.

The exception might be if someone is trying to sell the property in the coming months. Doesn't make sense to find tenants who are cool with being kicked out in a few months.


If this was true, we'd see landlords with paid-off mortgages waiving the rent. Since we don't see this on any major scale, we can only conclude that mortgages are inconsequential to landlords demanding rent-payments.

The reverse can also be true, tenants don’t care about landlords.

You can't put more tenants in it and charge them rent.

If most landlords have a few properties, that's a no go. If they have 1000s and all are under demand, that's a no go as well.

Only if there are empty houses because people can't afford them will that scenario be able to play...

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