Real Estate

Pushing variable costs out of rent prices vs rental caps

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  • Feb 11th, 2023 11:52 am
Deal Addict
Jan 2, 2021
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Pushing variable costs out of rent prices vs rental caps

I was having a conversation with an European person and learned that in some countries there, rents are not inclusive of condo fees and some not even kitchen cabinets (ie. Germany). Even in Quebec, appliances are often not provided by the landlord and are moved from one rental to another like furniture.

The purpose of rental caps and ban of damage deposits is to prevent price gouging by the landlords, so excluding condo fees and even furnishings/appliances from rent (and caps) would not be unfair.

What do you guys think of structuring rental prices as base rent with utilities, taxes and condo fees extra? Other costs like furnace rental or appliances would also be separate. Could this become mainstream if enough people do this?
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Dec 4, 2009
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TwinkoStar wrote: I was having a conversation with an European person and learned that in some countries there, rents are not inclusive of condo fees and some not even kitchen cabinets (ie. Germany). Even in Quebec, appliances are often not provided by the landlord and are moved from one rental to another like furniture.

The purpose of rental caps and ban of damage deposits is to prevent price gouging by the landlords, so excluding condo fees and even furnishings/appliances from rent (and caps) would not be unfair.

What do you guys think of structuring rental prices as base rent with utilities, taxes and condo fees extra? Other costs like furnace rental or appliances would also be separate. Could this become mainstream if enough people do this?
I think something is going to have to have to give, eventually. Home pricing has escalated to the point that rent doesn't cover carrying costs. Add in taxes, maintenance and fees (which will only escalate, regardless if home prices stagnate) and costs can really get out of hand. Rent equally can't keep escalating the way it has. And demand will remain at least consistent, if not grow, as more and more people are priced out of the market (either by home pricing or rates).

People sitting on properties that were purchased long ago aren't necessarily faced with this. But this will become a bigger and bigger problem going forward.
"I'm a bit upset. I've been grab by the back without any alert and lubrification"
Lucky
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Jan 2, 2021
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Toukolou wrote: People sitting on properties that were purchased long ago aren't necessarily faced with this. But this will become a bigger and bigger problem going forward.
That’s not true, especially for condo owners. I’ve seen people asking for help for their condo rented at $1500 with condo fees that ballooned up to $1000+ over the years. Factoring in taxes and repairs they are essentially providing a free service at that point. Had they structured it as $500 rent + condo fees + taxes they would’ve avoided this problem and I don’t see why not, given most of the condo fees go into services that directly benefit the tenant.

Also perhaps renters would feel less resentment if they knew their landlord only took $500/month as opposed to $1500…
Deal Fanatic
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Dec 4, 2009
9335 posts
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TwinkoStar wrote: That’s not true, especially for condo owners. I’ve seen people asking for help for their condo rented at $1500 with condo fees that ballooned up to $1000+ over the years. Factoring in taxes and repairs they are essentially providing a free service at that point. Had they structured it as $500 rent + condo fees + taxes they would’ve avoided this problem and I don’t see why not, given most of the condo fees go into services that directly benefit the tenant.

Also perhaps renters would feel less resentment if they knew their landlord only took $500/month as opposed to $1500…
Agreed, except $500/mth would barely carry a parking spot in the GTA.
"I'm a bit upset. I've been grab by the back without any alert and lubrification"
Lucky

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