For some reason everyone views being a landlord as easy money. But in reality returns on investment are worse than the stock market for being the landlord of a single family home.
Then sell it, and put your money into the market. Now you’re no longer a parasite, and you’re making more money. Win/Win.
CodeInvasion@sh.itjust.works 1 week ago
Maybe I want to move back into it… And selling has a 10% cost after realtor fees and closing fees.
woop_woop@lemmy.world 1 week ago
So then it’s not worse?
Rivalarrival@lemmy.today 1 week ago
If you are operating rationally and you actually believe your ROI on the rental property is lower than the stock market, you would transfer your wealth to the market. Since you are not, you are either behaving irrationally, or you don’t actually believe your ROI is lower than the market.
Your ability to move back into the property is a return that you have not included in your evaluation. The 10% cost of selling is a sunk cost fallacy.
TrickDacy@lemmy.world 1 week ago
Yikes, what a nightmarishly unempathetic take on this situation
Rivalarrival@lemmy.today 1 week ago
Emotionless is the better term. I am trying to focus on the argument. I am assuming the best intentions of the parent commenter.
Parent comment argued they were making less money from renting than they would from investing in the stock market. They could be making more money elsewhere. Think about that for a moment:
They have the option of making $100 from the customers of a business. They could buy shares of a company making luxury products. Their return on their investment could come from people using disposable income to make discretionary purchases.
Instead, they are making $90 from a tenant’s housing budget. (They are also creating extra demand on the housing market, inflating prices in that market, thus increasing costs for every person seeking housing, including their own tenant.)
Somehow, that actually seems worse to me. If money was the point, they’d choose the option with the higher return. If they are choosing a “rent” option, then that is either the option with the higher effective return, or they are either acting irrationally, or they are paying for the privilege of exploiting a tenant.
Regardless, all three cases demonstrate the parasitical nature of landlording. The argument in the parent comment does not rebut a claim of parasitism.