this post was submitted on 30 Oct 2024
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I'm not defending landlords here — just pointing out that housing is expensive right now regardless of who owns it. Construction costs are through the roof (no pun intended) even before factoring in a profit margin for the builder and/or the landlord. If I had to rebuild my house today it would cost at least 3x what I paid for it 15 years ago, and my income hasn't tripled since then.
The things is, its expensive because of landlords and shit like airbnd. They have shrunk the market which increases the value of whats left in the market. Landlords are the reason why housing is unaffordable. Which puts you at their doorstep to rent from them.
Landlords are definitely not the reason that new construction is so much more expensive. They want the lowest possible construction cost, not the highest.
Heres the thing. Landlords buy up housing, this shrinks the market, this increases housing prices, this creates a demand for new homes, this increases demand for supplies and the price of labor for construction.
Landlords obviously don't want higher construction costs, but they do want more properties. Higher construction cost is a consequence of that, not the goal.
Have you considered that the reason labor prices have increased is because the cost of living has increased so much, primarily driven by housing prices?
Eh... Contractors are charging what they are charging now because they can, not necessarily because materials and labor costs justify it. I've been slowly rehabbing my basement this year, and I'm doing most of the work myself because the quotes I've been getting to have somebody do it for me are so steep that about half the time they would cover me setting up a whole competing company from scratch in addition to material costs. That's not an exaggeration. For what the plumber wanted for a repipe I could buy all the tools I need, attend training, get certification and a license, set up an LLC, and go into business for myself, and still have enough money left over to cover my costs on the project.
Not that I think all that profit is going into the pockets of the tradespeople doing the work, well compensated as they are, but at the end of the day it's down to high demand and a shortage of skilled labor due to decades of us devaluing the trades as a career. If I'm in the top third of the income distribution and the only reason I can afford to maintain my very modest house is because I have the skillset to do it by myself, something's gone haywire.
Corporate landlords are absolutely driving the prices up, combined with 3 decades of low interest and investors treating real estate like a speculative market. The material cost of housing is miniscule. North American homes are made out of paper and plywood.
If that's the case, can you explain to the rest of us why landlords want high construction prices?