Understanding Bullshit: Landlords
This is a lie that landlords love to tell, but strangely enough it’s not the landlord’s fundamental lie. (We will get to that shortly).
To put it simply, being a landlord is not a productive activity, it does not contribute to the economy, and therefore it is as much of a job as digging a hole just to fill it.
Economic growth is measured as an increase of Gross Domestic Product (GDP). There is Nominal GDP which is the amount of goods and services an economy is able to produce and provide without inflation or deflation taken into consideration, and Real GDP, which is simply Nominal GDP adjusted for price changes (inflation/deflation).
The role of the landlord is not one of production of goods, for there is no inherent creation in the act of land-lording, nor is it a service, for its nature does not fit the 4 I’s of Service, i.e.(intangibility, inconsistency, inseparability, and inventory). It is therefore that the nature of the role of the landlord is fundamentally outside any societal economic benefit.
If you are a contractor (or someone who commissions the building of housing) who owns what you build, then you do contribute to the economy; but as a consequence of the production of housing, not through your capacity as a landlord. As I’ve written about previously, and reiterated henceforth; a Landlord is simply someone who owns a building or an area of land and is paid for the use of it.
“But a job is doing anything that allows you to make money!”
So a job doesn’t need to be productive or contribute to the economy? Under your definition being a tele-scammer, thief, or extortionist are all jobs; (congrats you’ve found your kin).
“But being a Landlord is hard work. I have REPAIRS!”
I’m sure it is hard work; you do everything a homeowner would have to do, for free i.e., maintenance on the property, except you make money from it. The source of your income is not in the repairs, or the maintenance of your property, but rather the owning of it. To add to the point, the nature of your contract inhibits tenants from repairing things themselves, or improving the property by their own agency.
I’d like to get paid to do my dishes, but it’s not going to happen. But because I own the dishes and don’t want them to be dirty, (and since I’m an adult) I fucking wash them. Just as doing my dishes is a chore that is necessitated by both my ownership of the dishes and my desired future use of said dishes, so too whatever pittance of labor a landlord may put towards the home is also a chore — not a job. So, I wash my dishes. Is that now my job? Don’t be ridiculous.
“LANDLORDS PROVIDE HOUSING!”
This is it, friends: The Landlord’s Lie. A Landlord does not provide housing, but rather holds housing hostage. As stated previously, if someone creates or commissions homes, they — either through labour or investment — create something new: housing, and thus they increase the amount of housing, and therefore they provide surplus housing. The net amount of housing has increased. Seems straightforward to me. You build a house, and therefore you provide housing.
A landlord — merely by virtue of owning a home — does not have such a relationship to the amount of housing available, but rather maintains housing at an equal level. If there are five houses in a town, and you buy one to rent it, you did not through some arcane transubstantiation turn an old house into a new house, nor (as physics tells us) did you create something from nothing, such that the amount of houses remains the same: five.
What then, in essence, differentiates between possessing a home and providing housing? Is it the condition that the structure be owned expressly for the housing of others? Is it the active maintenance of a house i.e. putting in a new furnace or fixing the floors that creates housing? No, because as stated earlier, the housing innately exists within the character of the building, such that to acquire a building does not innately change the character of said building. These things (replacing a furnace, fixing the floors) do not provide the housing, but merely alters the quality of the housing. In this way, landlords are fundamentally responsible in that regard: that the house is suitable for habitation, and, in such direct control and responsibility over one of the necessities of life, the landlord, too, is inextricably responsible for the well-being of a tenant at minimum in the dimension of the physiological need of housing be met and be of a standard both safe and at a level accepted by society insofar as it is deemed suitable for habitation.
Are shitty landlords who don’t take care of their property reprehensible? Yes. But if yes, then why? Because they are lowering the quality of life of the tenant? If so, then the landlord is inextricably tied to the well-being of the tenant. If not, why? Because it is their property, and their decisions with their property does not affect others? Also wrong, as there are people living within the property. (Go back to the top of the flow chart and choose “yes” this time).
Now, you may have seen countless images circling the internet of landlords being heartless in the face of COVID-19. And I assure you, this is not some horrible misrepresentation, but merely the true representation of landlords. For them, it is only business.
“But my landlord is nice”, “my landlord offers payment plans”, or “my landlord has waived/reduced rent.”
That’s fantastic! I am glad they are giving you relief as a tenant, but make little mistake, their main consideration isn’t friendliness. It is largely easier for them to keep a good tenant and be lenient than to go through the eviction process and tenant screening — and that’s during the good times. Given the extraneous circumstances, it is likely they fear legal recourse should they take immediate action. If they act disagreeably at the onset of the eviction freeze present in many cities and states throughout the USA, then it is possible that the tenant may look for another place to live entirely, and stop paying rent to the landlord, even partial rent. (It’s all about the Benjamin’s baby!) Or maybe they’re considering your hardships and those of your fellow tenants, and that’s very kind of them, nonetheless, they’re still institutional parasites.
Yes. (And stop screaming at me). As explained many times already, landlords do not create — they only take. You may hear landlords tell you that they have bills to pay, and therefore they cannot provide any relief to you. In the majority of cases (I say “the majority,” and not “all” because financially illiterate people exist, and people who sink money into “investment fire-pits” exist, so there are cases where this is not true, but I assure you, the amount is insignificant, especially if you have a commercial landlord, or this isn’t your landlord’s first rental property) rent covers all the expenses for the house, with surplus cash flow (profit) left over for the landlord. Let me repeat that for the people in the back: rent pays for the mortgage and more. If you can afford rent, you can afford a mortgage. Landlords of course dispute this, and this brings us to “The Paradox of The Expensive House.”
Landlords exist in a paradox of lying; houses are expensive, too expensive for renters, but also it is the renters who pay for the landlord’s ownership over the house. If a landlord states that houses are expensive — such that they are revenue neutral or at a net loss — we must ask ourselves, and the landlord a positive question: If it’s so expensive to own a home to rent (income property), then why do it? Are they losing money owning a second or third home? Where’s the business savvy in this? Either it is a bad investment – in which I commend the idiot who went through the long process of buying a house just to not understand that they’ll be losing money — in which case, they’ll just jack up the rent, or they’re playing the long con; equity and appreciation.
Home equity is the difference between the home’s fair market value and the outstanding balance of all liens on the property. Appreciation is the amount in which the value of something increases over time.
The landlord gains net value even if they pocket a loss monthly, through these two means. Let’s fashion a hypothetical.
A landlord buys a single occupancy house. Let’s say it’s uhhh….a three bedroom place and goes for $200,000, and rents it at $1,500 a month. This is generally a sub-optimal investment, and most landlords wouldn’t do it, but we’ll continue. Let’s assume no down payment and accept my bank’s default interest rate of 3.340% (which is a little high). My bank’s mortgage estimator-calculates the mortgage payment at $980 a month. Add $270 for property tax (based off my hometown’s rate). Given that most home renters in my town pay their own utilities, that brings the expenses to…$1,250. Shit. I made a profit of $250. Let’s bring rent down to $1,000/mo (below market price), so that the landlord is losing $250 every month on regular expenses. Well, the landlord/renter is still putting the $980 towards the mortgage, and another $20 on the property tax every month. This money is going into the asset that the landlord owns, increasing the equity by $980 a month. On top of that, the house will appreciate in value as the economy experiences inflation, the infrastructure within the urban area increases, etc, etc. It is in such a way that the landlord does not lose money, but rather, converts the liquid asset of cash ($250) into the illiquid asset of the ownership of the home, and at a rate of four times.
Now for the negative question: If it’s not expensive, then where does the money go? Do landlords finally admit that the tenant pays not only for the upkeep of the house, but enough to give a surplus to them?
There are of course several axiomatic principles which I hold that inform this piece, and indeed my perspective as a whole. One being that it is unjust to make profit without labor. I also hold that human necessities should be a right, provided for at cost (not for profit), and any infringement upon this right is necessarily immoral. (For good measure, let’s throw in that human life has value beyond any monetary amount). In other words, if you can literally die without something, then people shouldn’t be allowed to withhold it for money. (Anyone with an IQ above 70 already understands this).
So please, if you’re a landlord it’s of vital importance for you to comprehend this one prevailing mandate: go fuck yourself, you cocksucking leech!