Rental properties and why we shouldnt respect anyone who has one.

[Browny]

So once again, I hear of an argument between my brother and our dad. As per usual, relating to the 'when I was your age, I did this and I owned that' tired argument as justification as to why the kid is a disappointment. This usually is based on the 'kids these days are lazy, dont want to work, spend all their money/time on drinks/video games etc' as a method to form a guilt trip. After being on the receiving end of this crap for a while, im taking a total offensive, and I make no secret that the older generation are the most complacent, silver-spoon fed, greedy and destructive generation in human history. I find the reactions amusing. However I'm no idiot, I put a lot of thought into things. Todays lesson, is why anyone who owns, or even wants a rental property for investment, is the scourge of the earth. For the record and some context, I moved out 10 months ago and have lived interstate in rental properties this whole time. This is merely one aspect of getting somewhere in life I am discussing here by the way, the corporate nature of colleges and job shortages are other issues altogether, but they directly affect the following situation, however are not relevant to the actual focus of this rant.

Scenario:

Old couple who not only have had enough money to live a full life and owned their own house for decades, decide that they want to keep being fed by the silver spoon well into retirement, looking to buy an investment property.
Young couple looking to start a life with a family etc, looking to get out of the rental market and into a home.

A house is up for auction, and both parties want it. It is within affordability for the young couple, which means it is easily affordable for the old couple who have countless thousands saved up, and no trouble getting the loans with their house as collateral etc.

Seller of the house, most likely an old person since they actually OWN the thing, and no young person would ever sell a house if they got one, let alone own it before they are 40. Being old, they care about one thing: padding their retirement fund. They will go with the highest bidder and most reliable buyer, the older couple.

Older couple win the house, renovate it easily with the money they have saved, and rent it out. The young couple is forced back into the rental market.

Due to the increasing population, and the lack of people owning their own houses forcing more into temporary accomodation, the rental market becomes fierce competition as those who could actually afford a house under normal circumstances were they not shafted by the older couple, form the higher end of those who can afford rent. They take up a rental property, dragging the price of all other rental properties up as they can outbid most others. The longer they are unable to afford a house, the more they lose 'dead money' to rent, and the more desperate they become.

The increasing population is a major factor of this, and the older couple once again are the direct cause of this. A total lack of foresight can be understood as we are talking an entire generation gap here, however once the mistakes of the past have been realised, not only are they not sorry, they strangle the very generation that they bore for all the money they have within legal limits, catered towards glorious capitalism of course.

--

So there, yet another reason why no young people these days should ever feel intimidated by the older generation who like to impose their status in life as some sort of indication that they are anything but grossly irresponsible extortionists. Im not saying they are all like that of course, but the ones who dare criticise me for any aspect of my life which wasnt as good as their when they were my age, need to be reminded of how wrong they are, and how their mentality overall, causes the world to be in the **** economic state it is today. We the young ones will have to deal with this, while they retire on a yacht somewhere and we forego simple things like restaurant dinners to pay their pension, which we of course wont ever get, or have it be anywhere as large as theirs due to the insane debt of the country.

Of course my rant here means nothing, but I dont like hearing stories of people feeling like crap and entering depressive spirals because their parents, or any older person, abuse them for not being in a stable position in life. It happened to me, my brother, and my friends. We cant change what has happened so complaining to them wont make anything better, but we can at least remind them to shut the **** up, and solve our problems for a 2011 world using 2011 logic. Depression is such a major issue these days and as if economic hardships werent enough to deal with, the guilt trips that we are failing in life are so destructivr... There is no excuse for it. No one should ever have to put up with, or feel guilty, because of someone from the older generation telling them ANYTHING.

If the average age it takes kids to move out of home nears 30, that says NOTHING about young peoples drive to succeed and be independant. If the parents dont like it, they need to shut up and help. So guys, next time an old person feels the need to berate you because of any aspect of your life that isnt as good as theirs at your age, dont feel bad. Its not your fault and it most DEFINITELY is not the governments fault. Oh, and feel free to abuse anyone who owns a rental property freely. Ill be doing that from now on.

 

[Sucumbio]

Quite poignant on many points. I like how you mentioned the corporate nature of colleges as well, because that's something that's bothered me ever since I was high school aged. It's not enough that colleges charge ridiculous amounts of money for sub-standard educations, but the entire American Public School System is literally engineered to foster -private- college growth. What are all these so-called graduates supposed to do when they graduate? Find a job? I've had a degree for going on 15 years and work a ****ing gas station, lol. Why? Because it's all I could find! My degree is "worthless" to most employers. The biggest employers around here want able bodied blue-collar workers. Machinists, laborers, welders, electricians. Not book worms.

It just so happens that my grand folks did this exact thing. Technically a little different; they rented their summer home once they reached an age that was actually too old to go through the rigmarole of "opening" it up each summer (it was a cottage so it wasn't a year-round home, and any home that's not lived in tends to require work once you move back in to inhabit it.)

It turned out to be more of a headache than it was worth. The renters were young... about my age now (mid 30's) and didn't take good care of the property. They were always late with the rent, and never called to tell us of a problem, instead just opting to let it go so that it got worse and ultimately more expensive to fix once we discovered it. After awhile my grandparents took it off the market, let me have it, and after I'd tired of living there (it's way out of the way from where I was working, 2 hour commute both ways is no fun) they sold it.

When I inherit the family estate I have two choices: rent it to someone for about 4 grand/month (It's a 6 br 2.5 bath, 2 car garage, 3 floors, fully landscaped with privacy fence) or sell the property for about half a mil. Regardless of which choice I take, I'll have to split the earnings with my younger sister. We could also technically move in ourselves (me and my wife, or my sister and her ... man [she doesn't believe in marriage, go figure]) but the expenses are insane! The property tax alone is about two grand a month. Last year their heating bill (oil and electric) was about 12,000 ... water about 1500 for the year, trash and sewer another 1000... add in tax for the car, a car note, food and gas for the year, you're looking at almost 50 grand a year to live there. I make 19.5 my wife makes maybe 22, lol up there, unless we got serious career advancement, even with cost of living adjustment for wage and having the same jobs (gas station attendant and a retail parts pro for an auto parts store) it's not coming up to anywhere near what we'd need. So yeah, prolly just gonna sell the *****.

I can't blame old people for owning rental property, though. Today's politics threaten to strip old people of their retirement money almost daily. That kind of doom looming over head is enough to scare even the thriftiest of seniors into taking out reverse mortgages so they can buy up other property, and either flip 'em or rent them out. Plus it really depends on your location. Many places there isn't a huge demand for owners, and instead people who prefer to rent. I personally hate the idea of renting, it's throwing away money, really. But on the other hand, it IS a rental, so if anything goes wrong, a quick call to the landlord and it's fixed. Home owners, if your water main bursts, or you have an electrical fire, or your roof caves in, etc etc etc, yeah.... YOU have to fix that. Insurance may pick up some of the tab, but more often than not, household ownership results in years of money being thrown at the house, keeping it in one piece, plus you're still paying on the house for 15...20...30... even 40 years. And God help you if you have to take an equity loan, cause now you're payments are double, and what do you have to show for it? A new floor perhaps? Which wouldn't have been necessary but for the fact your kitchen sink valves failed and you had a flood?

Anyway... it's a lot to think about, renting vs owning, and how old people play into it. I sympathize with your stance, and I agree it seems foolish to favor old money when a bid is in place. But if anything the recent housing market has taught realtors, it's that new money is frivolous, and dangerous to trust. People of -this- generation don't have the same .... scruples as it were, when it comes to managing debt. All too often kids will rack up credit cards, and simply ignore them when they've maxed. It used to be that people were afraid to go to prison if they didn't pay the cards on time, lol I mean it was -that- serious a thing to keep your credit history clean... but these days? Pft. Who cares? You can declare bankruptcy and buy a brand new car in the same day pretty much. You can just not pay debts and thanks to the fair debt collection practices act, it really does take a court injunction to garnish your wages of it, normally it'll just drift off into obscurity until 3-7 years have passed and it's gone for ever.

 

[Jam Stunna]

This reminds me of a rant I went on last year:

Lately, I've been feeling more and more that our generation has been had. We were born in the 80's, were kids in the 90's and came of age in the 2000's, and all we have to look forward to for the next ten years is the wasteland that's been left to us. The Baby Boomers and Generation Xers spent the last 30 years building a house of cards, and we enter the beginning of our adult lives just in time for it all to collapse.

It just feels like we got ****ed before we were even old enough to realize it. They're calling this a "young person's recession," because layoffs have been bad, but the real problem has been a total freeze on hiring. Who gets hurt by that? You and I, the people looking to start careers. But careers dissapeared a long time ago anyway. Now there are only jobs that we hold until we're downsized to maximize profits for people who's parents benefited from the greatest expenditure of government resources in human history, but now rant and rave about taxes and big government.

Older people treated debt like a commodity, and now we're left to clean up the pieces after it became painfully obvious that wasn't a good idea. Worldcomm, Tyco, Enron, Lieman Brothers, the entire newspaper industry, guess who ran those companies into the ground? Not people in our demographic. The levies collapsed, there was no WMD, Hope and Change turned out to be more of the same, and who's left to foot the bill? We attended public schools that have produced a group of 18-29 year olds where 1 in 4 of them don't know who America beat in the Revolutionary War. And all the while, the same dinosaurs in media, politics and industry refuse to release the reins. We get sued by the RIAA when we demonstrate that the distribution model for music that makes rich men richer is absurd and outdated.

We're still fighting the culture wars of the 1960's because the people who tell us how to think never got over them. Do I support or oppose gay rights? What about abortion? Interracial marriage? How about this for an answer: I DON'T ****ING CARE. People can make their own personal decisions about their lives, and it's none of my business or concern. I remember a Newsweek magazine cover from the 90's heralding the existence of bisexuals, as if they were a newly discovered species. All I could think was, are you kidding? Isn't this common sense?

The world I was promised was just an illusion in the end, and the dream came to am abrupt end thanks to the bumbling ineptitude of the Greatest Generation's children. Fine, whatever, I can live with that. But whene show?" Robert Byrd was 93 when he left the Senate, and only by death. Rupert Murdoch will be 80 next year. If the nitwits running things now have longevity rivaling that, I won't be holding my breath.

What particularly galls me is that the same people who call us lazy and unmotivated, and who fight universal health care and other government programs tooth and nail, have benefited from the two biggest government giveaways in American history: the GI Bill (which helped their parents to establish the wealth that the Baby Boomers continue to exploit to this day) and Medicare.

 

[Browny]

I think I read that before, if you posted it here :x it looks familiar.

Yeah sucumbio thats all fair points and indeed is a reason to not lease houses to young people. But what people dont need these days is the double-whammy so to speak, of dealing with the fact that we are disadvantaged before we even have a chance to start, and then the guilt trips on top of that. I know Im not the only person who has been on the receiving end of the 'You wont move out till you're 40!' snide remarks and people think its all funny jokes, but its a serious issue.

Re; the college degree stuff, its a similar situation in Australia but apparently its quite severe in america... I can see that we are catching up though and it wont be long till we reach where you are at currently.

Btw some 'inspiration' for this I guess came from an old supervisor at my last work. This man was a genious, has lived in more countries than I care to remember, CEO of his own business, world record holder, and rich. He was also about 73, working fulltime at $120k+ a year job. Its fair to say he lived a full life and is absolutely loaded with cash. He also happened to recently buy a house very near where I was renting. I told him what I was paying (which was highway robbery, Sydney rental prices are the highest IN THE WORLD) and his response? He is going to increase the rent he charges to the young people living there, to match what I was paying for a similar unit.

I didnt think much of it at the time but now I look back at it... it was absurd. He has absolutely no need for money. I respect the man immensely because he is so successful and so smart, everything I wish I could do in my career, and more. But then he goes and extorts some poor young couple even harder in a very difficult place to live, affordability wise.

Honestly makes me wonder how deeply ingrained this desire for money is. Do they even know their actions are so greedy? Are there any connectors in their brain that form a link between the struggle to move out of home, and the extortion racket they are running?

-

btw Jam in many aspects I agree with lazy comments. Things that say, 30 years ago, took an hour to do, we might be able to do it in 10 minutes. Then if it takes 20, we complain and get mad about it, we want to spend more time doing things we like. I've seen that behaviour enough... When it comes to actual important things in life though like getting an education and getting a job, we are just as, if not more, motivated to do so. Me whinging about the computer not working and having to hand-write my homework, is nothing compared to a 4-year degree which people conveniently seem to manage to overlook -_-

 

[Spelt]

This is honestly an awesome thread. Lots of older people still fail to realize times change rather quickly and choose to just live in their little bubble where their opinions about current events are still relevant.

My favorite anti-our-generation argument is "Yeah, and who's responsible for turning this economy into **** again? Lots of good your 'hard work' has done."

 

[Beautiful Death]

So, uh, you're getting ticked off at dudes because they own properties and stuff?

Maybe these guys are just trying to make some cash, dude.

And I do not agree with grouping everybody into one group. Don;t be mean, dude.

Hey man. Have you donated to the poor or charities and stuff recently?

If you haven't you're a bad guy. Going by your line of logic or something like that.

Dude. Chillax and leave people to rake in the DOUGH from their real estate and stuff.

Most people don't want to break their backs into old age. They want to one day chill out and enjoy what time they have left on this earth. And having rental properties is a nice way to accomplish that.

I know for goshdarn sure that once I have enough BANK to do it, I'm a gonna buy like ALL the APARTMENTS AND STUFF I can get my hands on so I can rake in the gold without doing hard stuff for money. If it weren't for my mom's bazillion rentals and stuff I woulda probably grown up in the BOONDOCKS or something like that.

DUDE : 3

 

[Spelt]

Dude. Dude? Dude, duuuuuuuuuuuuuuuuuuude.

DUDE.

 

[Browny]

So, uh, you're getting ticked off at dudes because they own properties and stuff?

Maybe these guys are just trying to make some cash, dude.

And I do not agree with grouping everybody into one group. Don;t be mean, dude.

Hey man. Have you donated to the poor or charities and stuff recently?

If you haven't you're a bad guy. Going by your line of logic or something like that.

Dude. Chillax and leave people to rake in the DOUGH from their real estate and stuff.

Most people don't want to break their backs into old age. They want to one day chill out and enjoy what time they have left on this earth. And having rental properties is a nice way to accomplish that.

I know for goshdarn sure that once I have enough BANK to do it, I'm a gonna buy like ALL the APARTMENTS AND STUFF I can get my hands on so I can rake in the gold without doing hard stuff for money. If it weren't for my mom's bazillion rentals and stuff I woulda probably grown up in the BOONDOCKS or something like that.

DUDE : 3

Firstly, no they arent 'just trying to make some cash'. Anyone who buys a house these days is LOADED. With what it costs to buy a home in a capital city in australia (400k+), you could live off that for a verrryyy long time, include interest on that and the fact youre not paying back the bank like 200k in interest... no, 'just trying to make some cash' is not an excuse.

I care little for your reasoning. Theres more to life than making money. Its not about breaking your back in old age, lets not forget these people most likely owned their own home for decades and got to spend most of their wages on things they liked, a luxury you sure as hell will never be able to afford. And yes I will generalise them all and I dont care who it is. Sure they may have good intentions when they started, but that is pure, blind ignorance. I cant realistically expect them to have predicted what would happen if hundreds of thousands of other people, thought the same. What I can do however, is remind them how wrong they are and how guilty their generation should feel, that they would DARE call us lazy, when they did whatever they want without care of the consequences, such that we will have to work our entire lifetimes, just to pay for their mistakes.

As for me donating? Well I pay $20 a month to red cross, I give some money to beggars on the street if I see them, ill pay buskers and almost always give money to charity people if i see them on the street/outside a shop. So yeah, I do.

 

[Sucumbio]

Daughter to the pop veneer
Shining like a new mint quarter
Shining like the Franklin Mint
Seedy like the lampshade quarter
Rolling with the dopes you know
Rolling with the wrong gun on you
Going down to Baltimore
Going in an off-white Honda
Oh I miss the girl, miss the girl, miss the girl...

Sorry.

Anyway, ha! That ex-boss of yours is funny. "Oh really? You pay how much? Guess I'll have to raise the rent in my properties." haha, wooooow.

Of course people in that status, they do have a sense of "responsibility" to play a role in the economy. I mean there's rich people, who keep to themselves. And then there's entrepreneurs, like him. The latter tend to focus on booming the economy (and their wallets) so in a sense I'm sure he felt obligated to charge median amounts for rent so as to keep things stable (otherwise, who knows, his place might become a ghetto cause all the poorer people are living there.)

In fact he may have even used you as an example of the type of tenant he wanted, and since you're paying that, he needs to charge that, kinda thing.

It appears as if the biggest part of your original thoughts centered on the abusive nature of old people "looking down" on the young, and I kinda missed that, originally... but I agree, there's definitely no place for it these days, not to mention that our wages pay their support, lol so if they wanna name-call maybe they should try going without their precious retirement funds for ... a week. Oh wait, can't do that, cause that's a whole 7 days without Medicine, and that's like, 1/3 their expense, if not 1/2.

 

[Laem]

I was gonna make a sarcastic comment but y'all made it be in poor taste.

For real though: Average age to move out is THIRTY?!

 

[Johnknight1]

This is honestly an awesome thread. Lots of older people still fail to realize times change rather quickly and choose to just live in their little bubble where their opinions about current events are still relevant.

My favorite anti-our-generation argument is "Yeah, and who's responsible for turning this economy into **** again? Lots of good your 'hard work' has done."

If by hard work you mean a good amount of said "harder working" generations that did more drugs, have all kinds of extreme mental disorders, are the most unhealthy generation of world of all-time, and are more government-funded reliance than any other generation in American history (yes, even more than their parents or grandparents who lived through the Great Depression). And yes-we have to pay their retirement bills and their government support (many because of their bad personal decisions). It's one thing if you take a risk, it backfires, and take temporary government support, but c'mon!

The Baby Boomers and Generation Y (I think that's the generation after the Baby Boomers) are demographically the laziest generation of all-time! (that does, however, not apply to all of them) At least give us Generation Z'ers and the Millennial Generation time to get jobs, stable families, and learn who we are and where we are headed to judge us. The Baby Boomers and Generation Y aren't God (an all-knowing being). They need to stop acting like they are, especially since they are the most selfish, arrogant, and corrupt generation of all-time! They are also a big reason why there is so much wrong with the world.

I'm honestly I am glad I get to show that I can be superior to some of these Baby Boomers and Generation Y'ers. There are people I am close to and even related to in that age group that have called me lazy, stupid, and underachieving. That is even after I spent my teenage years dealing with physical limitations, I am a straight A student, I am respectful and polite, and I am one of the primary caretaker of my handicapped older brother. I can't wait to upset them with my success, physically, personally, financially, spiritually, whatever. It's a chip on my shoulder that drives me to be a better person.

Honestly, most people's comments to me are in one ear and out the other. That is, unless I see qualities in them I want, whether financial, personal, health-based, spiritual, etc forms success, wisdom, good decision making, and so forth. These "know it all's" tend to be the least wise people. To know you don't know it all or you never will know anything close to it is true wisdom.

P.S.: Good thread!

 

[Grim Tuesday]

If they earnt the money, shouldn't they be allowed to buy whatever they want with it?

 

[Browny]

No, because it comes at the expense of others.

Grim its pretty simple, there is a MAJOR housing shortage in Australia. Rent is obscene, I was paying $285 A WEEK for a place in west sydney. The reason rent is so high, is because so many people cant afford houses when they are 400k+, so they go into the rental market. The less people who own houses (A result of far too many people owning 2 or more), the more who are renting, the fiercer the rental market becomes.

As the population grows, older people are buying more investment properties faster than new houses are being built. The ratio of people to people who own a house is dropping every single day and it shows no sign of slowing down. Its clear this wont end well.

So no, they shouldnt be allowed to buy whatever they want, because its very dangerous. This just CANT continue. People must have a social responsibility. For another example Grim, say a mother decides that she wants to have 10 kids. She can barely afford food, the children are forced to go to poor schools, wear endless hand me downs, never own their own toys, not be able to afford family holidays, eat staple foods and generally go hungry every day, not be able to see movies, have almost no pocket money for anything they ever want.... I can go on all day. Older people need to consider the livelihood of the next generation, you cant just act disgustingly selfishlessly because you can, theyre making the lives of young people incredibly difficult.

 

[Grim Tuesday]

Fair enough, interesting blog.

 

[Sucumbio]

Rent is obscene, I was paying $285 A WEEK for a place in west sydney.

Wait... you consider that a lot?

According to XE.com 285 AUS = approx 276 USD

so if that's per week and 4 weeks/mo = 1104/mo

Now I don't know much about Australia or Sydney, but if you compare Sydney to say... the US's version which would be, what, New York City? Boston? Los Angeles?

Dude... that's a STEAL.

There's places in Boston going for 12 THOUSAND a month. Not Twelve Hundred... Thousand.

Perhaps the wages are that much lower in Australia? I mean we can see that the dollar isn't much different... so if 1104/mo is too much, that means you mustn't be making much per hour...

Yeah?

 

[Browny]

No, I was in west sydney in a small unit, 45 miles from the actual city. Once you get into inner sydney, its over 800/week for cheap apartments.

And compare apples with apples. Im talking about ENTRY LEVEL units. If you want a house, it starts to shoot up to ridiculous levels. Our wages are on average, higher than americans, but our cost of living is higher. Its all relative.

Sydney is the most expensive city in the world by a considerable margin, a study earlier this year found that on average, similar units in sydney were 40% more expensive than ney york city.

Your 12,000/month place in boston, would be 20,000/month in inner sydney.

 

[SuperBowser]

And I thought I'm overcharged for my 90 pounds a week. Do you guys live in luxury apartments or are these prices for a whole family or what? Even when I'm working with a decent pay, the nicest place I'd consider renting in central London would be ~150 pounds.

 

[Browny]

Nope, thats just the cost of living here. When such a large proporiton of our states is outback (AKA uninhabitable desert) it almost forces the majority of people to live in capital cities. The cities just spread further and further out (no joke, 65km out of sydney is STILL considered sydney, the urban sprawl is ridiculous) and when they cant get any further, they build up in the middle, and it gets expensive. But again, its all relative. Our wages on average are higher, so we will naturally pay a lot more. However the situation in Australia with very few places to live outside capital cities is unique, and something that the USA and England does not have, and it drives our prices through the roof.

Wait... you consider that a lot?

According to XE.com 285 AUS = approx 276 USD

so if that's per week and 4 weeks/mo = 1104/mo

Now I don't know much about Australia or Sydney, but if you compare Sydney to say... the US's version which would be, what, New York City? Boston? Los Angeles?

Dude... that's a STEAL.

There's places in Boston going for 12 THOUSAND a month. Not Twelve Hundred... Thousand.

Perhaps the wages are that much lower in Australia? I mean we can see that the dollar isn't much different... so if 1104/mo is too much, that means you mustn't be making much per hour...

Yeah?

I found something for you, didnt take long
http://www.domain.com.au/Property/For-Rent/Apartment-Unit-Flat/NSW/Sydney/?adid=6930993
Thats 12 THOUSAND FIVE HUNDRED

A week.

$50,000 a month.