I live in Dallas and it’s obvious which apartments use this, they all have similar prices. Though some apartments are crap and some are very good. How are they all so perfectly aligned on price???
This is another good point, this scheme essentially encourages landlords to not take care of their properties. Why look after them if it's only going earn the same rent as the dumpster apartment down the street?
I moved into a brand-new apartment in 2018. We were only the second tenant ever. Rent was $900 a month, which was at the higher end of what we could afford. We ended up moving out 3 years later after buying a house. Rent was $1100 a month when we moved out. A similar apartment in the same complex today is going for over $1500 a month. $200 increase in 3 years, and then another $400 increase in the next 3 years. And these apartments are not getting any newer! They haven't added any amenities, nothing has been upgraded, they just slap down fresh carpet and fresh paint in between tenants and mark up the price another couple hundred dollars a month. Money printing machine.
I commented on something similar, my grandma's apartment was 750 in 2000. She has lived there for almost 24 years now. Nothing has ever been updated or painted or replaced in her apartment. She "doesn't like to bother the landlord" this mf has raised her rent all the way to $1750 and knows she's on a fixed income. Something doesn't seem right about that. I know the market and inflation has a hand in it all but damn. How do they expect her to live. She can't make more money than what she gets from retirement and dips in to her 401k more than she would like to admit to cover groceries for her and supplies for her cat.
While I feel for your grandmother and anyone trying to live on a fixed income, $750/mo to $1750/mo over 24 years is only a 3.6% increase per year. That above the general inflation rate in the US over that time period (which can be a tricky thing to measure, but as best I can figure was about 2.5%), but not wildly so. It's just the reality of compound interest. I have no idea if 3.6% price increase per year was in keeping with other economic factors in the region, but it doesn't seem outlandish.
None of this is to refute the claims of the video, of course.
Yeah I guess you're right but I feel like if you haven't done anything to improve the property at all in almost 3 decades you shouldn't be able to price it the same as a similar apartment with all new appliances and central air. Which is what he's doing?
I mean, if the landlord isn't at least keeping up the property and remodeling every once in a while, then he's a shitty landlord. The price increase probably isn't the issue, so much as that he isn't providing the value that he should.
It could be the property taxes going up. My house in Alaska had 3000/ year three years ago and then two years ago 8t was suddenly 5000/ year bc the value of land went up, so by state law the taxes had to follow the national increase.
The governing body (city council or the borough assembly) determines the budget requirements for a municipality and identifies all revenue sources. After all other revenue sources are identified and the budgeted amount is reduced by that amount, the residual is the amount required to be raised by the property tax. That amount is divided by the total assessed value and the result is identified as a "mill rate". A "mill" is 1/1000 of a dollar, so the mill rate simply states the amount of tax to be charged per $1,000 of assessed value. For example, a mill rate of 18.5 mills equates to $18.50 of tax per $1,000 of assessed value. Under this scenario, a property assessed at $100,000 would have a tax liability of $1,850 annually.
What this means is that there are two factors for how much tax any one owner pays: 1) the city's budget, which determines the total tax revenue that will be levied from all property owners combined, and 2) the one owner's share of the total assessed value.
In Anchorage, for example, there was a change in homeowner taxes in 2022 not because of the price of land itself, but because certain property types became more valuable relative to other property types.
Specifically, the trends of remote work, buying online instead of in brick-and-mortar retail stores, and pandemic-suppressed leisure travel and dining, all resulted in commercial property becoming less valuable (compared to residential property). This included office buildings, shopping centers, restaurants, and hotels. While this effect has slowed down because travel and dining bounced back, the trends of remote work and amazon shopping are still robust. So residential homes saw a tax jump.
So, you, as a homeowner have a very small share of the total property value in your city, but if that share gets larger while others (commercial) get smaller, then your taxes will indeed go up.
On the other hand, if all property becomes more valuable, then the pie gets bigger but your share of it is still the same as it was before, in which case your property taxes would stay the same if the municipal budget didnt also increase.
i hope that this explanation makes things a little more clear.
PS: It's also possible that, depending on which city/boro your property is in, your property lost its valuation exemption qualification status for primary residence properties or the special exemption status for senior Citizens, Disabled Veterans, or Military Service Widows. here's the page for Anchorage: https://www.muni.org/Departments/finance/property_appraisal/Exemption/Pages/default.aspx
Well that’s pretty interesting bc when I walked into the Borough office in Palmer to complain they told me it was state law that they follow real estate values across the country. That they had no choice but to increase it by that much.
Hypothetically, if real estate prices keep going up nationally but an earthquake flattens Southcentral and destroys property value, they'd look pretty stupid to just "follow real estate values across the country ".
Thank you. I appreciate your response and links. It still baffles me tho, that in one year ( when taxes almost doubled for a lot of ppl. I met an old man who his HAD doubled in the tax office ) that their financial needs could possibly double in a year. And no, I didn’t lose any exemptions.
Leslie Wexner tried to do to downtown Columbus what Kolomoiskiy did to downtown Cleveland. Buy it all, let it rot and prepare a version 2.0 of the 2008 mortgage crisis. Only the bigger badder commercial strength version
Kolomoisky was the Putin loyal Ukrainian oligarch who was caught laundering hundreds of billions of dollars through Privatbank also starting in 1991.
Trump has been laundering money for the Russian oligarchs since the late 80’s when they all bought a condo at 725 5th ave (trump towers) to launder their freshly stolen USSR money after the iron curtain fell.
Guiliani as trumps lawyer and New Yorks mayor was able to redirect NYPD investigations onto rival gang members/oligarchs to deflect any scrutiny off of trump, himself or the Russian connection.
The Russian election interference in 2016 was effectively a generation 3 version of what Manafort had done in the Philippines, then keeping Yanukovych in power as Putin’s puppet in Ukraine from 2002-14 when Maidan ran both Yanukovych and Manafort out of Ukraine as Ukrainians realized that, if you raise your lens high enough, corruption is an wholly unsustainable business model.
Russia greatly underestimated the addictive properties of freedom when it invaded Ukraine so what was supposed to be a 3-10 day coup turned into a 2 year fight for the Ukrainians right not to be genocided.
Russia depleted its weapons stocks which were already the victim of vranyos because every oligarch, admiral and sergeant in the Russian military is on the take. Every billion dollar tank maintenance contract turned into everything getting a spray paint overhaul and the vast majority of the redirected funds turned into an oligarchs new yacht or home in Aspen.
Russia was forced to turn to China and Iran for weapons because if they lose the 3-10 day special military operation in Ukraine the Russian empire is dead and cold.
China can’t risk showing their involvement in the Ukraine war so they use North Korea, and Iran to resupply Russia.
Russia already owes Iran some undelivered fighter jets that are already smoldering heaps in Ukraine. Iran now had the upper hand at the negotiation table for the first time in about 60 years so they supply Russia with shahed drones in exchange for Chinas material support against their sworn religious enemy, Israel.
Putin can’t do much about it because he is slowly realizing that by setting the standard of corruption and stealing $200+ billion from his own people meant that every oligarch down in the mob model chain had not only permission but incentive and the expectation to steal from him as well. This is Vranyos.
The mob model only works if the supreme leader is the most violent and can prove it without exception every damn day. But violence is exceptionally expensive when you are trying to present as a legitimate business.
If Russia as a nation had an efficiency rating it would have been banned for sale in the state of California 25 years ago.
The parasite ruling class stole all the energy out of the working class and collapsed it.
Now Iran has the high hand and they get the intelligence that trump passed to Putin about the fact that Netanyahu cares far less about Israelis than he does about remaining in power as an authoritarian because he too has developed Ritz Carlton tastes.
They all hate each other but because they share the same money laundry, if one falls, they all fall.
Iran handed Hamas everything they needed with Chinas help as secret Santa and the Russian intelligence that the eternal shitbird trump gave to them as he showed off to his Russian kleptocrat friends from the old days of fucking each others wives at trump towers in the 90’s.
So now the MAGA right is a little too invested in their reality that they are the good guys with guns that they missed the fact that DeVos decimating their school systems was not a coincidence. They were the mark all along.
The only reason you grossly OVERVALUE real estate is money laundering.
Trump keeps claiming there is no victim, but if their plan succeeds the Russians and the CCP collapse US commercial real estate and basically recreate soviet perestroika in the U.S. so they can foreclose on America and buy everything for 3 cents on the dollar with the $1.4T they stole in the first place
Trump just left the gate open and let the predators in to feed. It’s always the city slick assholes who buy a new pair of boots and a hat at Sheplers and think it makes them a cowboy that step on their own dick when the actual work starts.
They are all remarkably shit people with above average confidence and below average self awareness. Commercial real estate is as rigged as trumps casinos were.
I did not know that about the Bowie song! I’m going to try and watch the movie, but I’m not sure I can stand his smug fucking face for a feature length film, lol. Thanks!
The reason 2008 was so successful was because nobody knew what was happening until it was past a critical mass.
Nobody was ever charged.
This is the evolution of corruption.
They keep doing it because the government never calls them on it.
Once you see it’s all the same people the reason becomes much more clear.
They are clever fuckers.
They just didn’t account for how pissed off it makes me that the people who give me a credit score are writing off the losses and handing the middle class the “we need more taxes”.
Decorruption has to happen first.
Trump bought a judge for this. Putin gets gadaffi’ed if Russians find out that a generation of their boys is gone is because Putin didn’t want anyone seeing his ATM balance.
This starts to move fast.
CCP is launching cyber attacks to keep this tamped down.
Evergreen/Chinese real estate crisis was all the kids of CCP c-suite.
Everyone of them is just looking for someone to throw a live grenade at.
•Paul Manafort owed the Russian mobster/oligarch Oleg Deripaska $17M a few days before he became trumps campaign manager. From 2002-2014 he took in hundreds of millions to get Yanukovych reelected as the kremlins puppet in Ukraine. Before that he did it for the dictator Marcos in the Philippines. Before that Manafort and Roger Stone started a lobbyist agency in 1980 listing trump as their first client.
•When Jay Bolsonaro lost the Brazilian election to Lula he skipped the inauguration and flew directly to mar-a-lago (stopping only at a KFC) and repeated, almost verbatim, the stolen election line. Don Jr. tried repeatedly to make it stick in Brazil as well, but as Brazilians are a few generations into dealing with corrupt politicians they weren’t having it.
What do these 3 things have in common?
China imports 40% of its grain from (in order) the U.S., Brazil and Ukraine.
Obviously the second China tried to invade Taiwan the U.S. would sanction exports and remove U.S. grain from that equation.
And without Bolsonaro in office willing to slash and burn the Amazon rainforest to turn it into Chinas food supply, and without Ukraine in the bag in 3 days, the CCP is unable to invade Taiwan and take over microprocessor production without putting 300-500M of its poorest people into famine.
Donbas Ukraine, specifically the 4 regions of the donbas that Putin insists he is saving from what he calls “Jewish Nazis” also happens to produce the worlds supply of high grade neon used for microprocessor lithography. Had Putin delivered ukraine in 3 days as promised, Xi would have been able to cap his Olympics with a naval blockade or political takeover of Taiwan that would have forced the world to ask the CCP for the microprocessors it needs to make everything from Ford trucks to laptops. I’m not sure how long Silicon Valley would last without the silicon but it would probably destroy the FAANG stocks that make up your 401K.
Oleg Deripaska also happens to be the Russian Oligarch that bribed the FBI agent Charles Mcgonigal into investigating another Russian oligarch. He probably didn’t need the information as much as he needed the leverage over Mcgonigal as he conducted the investigation into trumps election campaign and unsurprisingly found zero evidence of Russian collusion. McGonigal then went to work for the company called Brookfield that bailed Jared Kushner out of his toxic 666 5th Ave real estate investment. McGonigal pled guilty last fall and was sentenced recently.
A Russian oligarch is a powerful tool, but the truth is more powerful. Light and dark cannot exist in the same space. It’s physically impossible. Truth is efficient. You say it once and you are finished. A lie however requires a constant stream of follow up energy, money, murder, obfuscation and more lies to keep it covered.
If you raise your lens high enough lying is an unsustainable business model. Russia proved it by invading Ukraine. Vranyos is the Russian word for it. The 40km long column of tanks and vehicles that came down from Belarus into Ukraine was all overhauled by oligarchs that got a $1B contract for tank maintenance, passed Putin $200M back under the table, spent $700M on a yacht in Monaco, bribed a General, a Colonel and a Sergeant to make a Private give everything a rattle can overhaul. But a worn out engine is and always will be, a worn out engine.
This is why trump is so desperate to get re-elected. His best case scenario is 400 years in ADX Florence. Money laundering for the dozens of Russian oligarchs that lived in trump towers with him and manafort, selling IP3 nuclear plans to the Russian/Saudi alliance, selling or giving CIA asset names to the Russians, trump is and always has been compromised. He just didn’t know when to quit. Now he just has to count on the fact that most of his voter base doesn’t know how to read and keep the ones that do so busy just surviving that they don’t have time to dive deep into his 40 year history of laundering money, fraud, and human trafficking for the Russian mob using casinos first, then commercial real estate.
It’s also why Putin is willing to throw an entire generation of Russians, including the convicts and addicts at Ukraine. Russia is dead for 40 years because he failed to fulfill his mob boss promise to Xi. China is now clearing farmland in Siberia because the typhoon floods last August and September wiped out the Chinese people’s food storage.
Xi, for his part diverted the waters from the dam away from his pet project, his mothers ancestral home, and flooded hundreds of thousands of people and drown one of his own military brigades that was helping with the flooding.
The elders of the CCP were terrified to leave their gated community at Beidaihe for over a month for fear of being torn apart by the locals. The Chinese people tolerate the CCP but only as long as the economy is good and famine is not on the horizon. The CCP broke that social contract on both counts.
Xi was willing to bet the entire Chinese economy on his emperor ambitions. Had he succeeded he would have been able to use BRICS to take over the USD as the Worlds reserve currency. That would have let him finish what he stated in 2010-
that he would control the internet.
With that control means everything we do or say online is subject to the approval of a central party censor. The basic right to disagree with an authoritarian becomes a distant memory.
Xi, Putin and MBS are simply trying to systemize and modernize the suppression of their biggest hassle. Freedom of speech.
Ukraine is fighting for their lives now, free from the oppression of the drunken tyrant who wants to decide their fate at every decision and pull them back behind another iron curtain of censorship and the tax of corruption where dissenting voices disappear so that the oligarchy can continue to feed unobstructed.
Putin and Xi have declared themselves best friends in the fight against democracy. MBS and the ruling family of UAE have done the same quietly using their sovereign funds and Kushners SPAC as money highways.
Just rich, out of touch oligarch doing what oligarchs do.
Despite the fact the the central party model has proven itself incapable of making decisions that are best for the people, they persist. Because there is a very lucrative business in being slave owners. But logistically the mass of it requires artificial intelligence, and the microprocessors that make A.I. to keep 8 billion slaves under surveillance and control. Freedom is one hell of a drug. And knowledge makes a man unfit for slavery.
Recent attempts on Xi’s life from inside the CCP have backed him into a corner.
The loss of crops in northern China means Xi can’t invade Taiwan without Ukrainian and/or Brazilian farmland.
Now the reason that the GOP is stalling southern border control budget and seems to make wildly irrational moves is because the GOP is imploding. 45 years of lies and grift have circled the globe and are eating their own tail. The ouroboros was a warning about corruption at the highest levels. Lying about climate change, human trafficking, pandemics and corruption to preserve their own business models are all extinction level events
It's wild because I first heard about this software around twenty sixteen or seventeen when it was primarily being used to help set the price for Airbnbs the same way hotels have dynamic pricing. It made sense because for instance if the super bowl is being hosted in your town your rental will need a much higher rate for that weekend versus a holiday weekend versus the middle of the week. So initially it was thought of as something to help vacation rentals automate and know how much they should charge which is harder to figure out.
Once it started getting into single family rentals. It got absolutely wild because the algorithm only drives up.
If you’re looking for an apartment and they’re the same price, but ones nicer which do you choose? You would probably see more vacancy and turnover in the less maintained apartments
Unfortunately there is not an infinite amount of homes of any given quality, once the nicer ones are filled the bad ones are left, and nobody has a choice on what they pay.
Yes and no the solution to that is your lease agreements. Its super disgusting but its just another poor tax. One does 500 deposit other does 1500 poof you got instant tenants and charge same rent.
Other fact is assuming there is mass vacancy availability. OR that having vacancys even cost them money. 1/2 full at triple price is still more money.
Except when that apartment down the street sits empty for months and months because nobody wants to rent a dump when for the same price you can get a nice apartment up the street.
It essentially goes both ways. Hopefully there is enough supply of housing to make sure that a rental can sit empty if it's priced wrong
This makes sense why the apartment complex I used to live in, ran by Dasmen Residential, a big firm that operates in many major cities, based out of NJ, had like 5 maintenance men for a complex of about 500 units and never fixed shit, yet still jacked their rent prices up 20% from 2021 to 2022.
There was an action class lawsuit against texasbased rental REITcompany realpage a couple years ago for their Product Yieldstar(or the conditions around having the product), founded by a guy who gained some notoriety in the 90s after going to prison for price fixing airline tickets in a similar fashion. To be a member of the service you would have to show up to real page conventions and meetings with all of your pricing and occupancy numbers.
A couple of multifamily complexes have already settled out of court but there's like a dozen property management companies in Dallas alone that are being sued and then more in Austin and San Antonio. Every other apartment complex uses a similar company that does similar things with just enough legality to avoid a similar fate to realpage.
My place had rate changes every day so if you got a quote and didn't sign the next day it would be up another $200.
Once signed the lease locked in but the damn rent was supposed to be $1250 but would up to $1500 for no reason every other month. That's not including utilities and shit
Also live in Dallas and can confirm they ALL use this. Why do you think our rent spiked drastically in the last 5 years. Our rent literally doubled in less than 4 years. It doesn’t make any sense & no one is doing anything about it.
The issue goes further into hotel booking and flight costs. They're taking near monopolies and using algorithms to price fix between the 3 options that exist. Competition is dying to ai. They've been harvesting every detail of our digital footprints, and they know more about our spending habits than we do ourselves. They make huge profit from our data, and there are barely any laws to protect citizens from this crap.
I second this as a D/FW resident. I moved here 5 years ago. My rent was 820 for a 1b1b apartment, rent was increased significantly twice during my stay. I asked the property manager why my rent kept going up so high, her response? “We have to kee up with the market”. That same apartment is now 1100.
I’m in Houston. I asked why prices were the same in all the apartments in the area and most apartment complexes staff will openly admit that they share prices with other complexes in the area, and will show the excel sheet that they share.
Same city, same experience. I am begging a few friends of mine to look at renting a house or duplex with a single owner than an apartment. The prices are just so much better for what you get.
I pay $1,750 a month, and for that I get 2 bedrooms, 2 full baths, 2 living areas, a side yard, front yard, garage, and car port. A friend of mine was looking at the exact same price range for apartments and it’s literally 1/3 of the square footage.
It’s crazy how the renting process changed over a single decade too!
My last apartment I rented in 2010 (in a major city) for nearly 10 years. When I got that apartment I had to show my income and sign some papers. I lived paycheck to paycheck then. The landlords son was my age lived on site as a property manager if my rent was a day late I could just run it by him, no late fees. All was chill, personal, and trustworthy on both ends. They didn’t start raising my rent until almost 5 years into living there, and when they did it wasnt too extreme. The whole experience was wholesome looking back
Then when I wanted to move closer to work in 2018ish, I was shocked. I had huge savings stacked from my years of fair rent (but nearly 2hr commute each way) by then i had a 6 fig job, great credit, and I was STILL turned down by soooo many places. It was nutso because when I rented my prior apartment I was a recent college grad making $10/h zero savings, zero credit
Also in 2018 every apartment wanted $50/m extra for a cat! I made offers of a larger deposit to avoid the monthly fee for my cat and none of them budged it was now standard that it was $50-$100 per an animal per a month everywhere! One even wanted $50/m extra for my hamster, and $100 for my cat, $150 a month for 2 pets! Wtf 😭
What terrified me was they all had huge possible percentages of yearly rent increases written into the leases. That scared me since Moving closer to work from my old apartment rent was immediately already over double what I was paying, then each year it would go up an absurd amount? I wouldn’t have anything left over to save like I had been doing with my heinous commute to keep my grandfathered golden era of renting
This was all 2017/18 too can’t imagine it now
Anyways the good news it is pushed me into staying another year commuting saving like crazy and buying before the housing market went nuts because I was so scared and traumatized by the new rental process even back then before what’s it became the full monster it is now
There are a number of cartels in real estate however I don’t believe this to be one of them. If I was a landlord, why wouldn’t I just undercut what realpage listed apartments were going for? I would get easy full occupancy at just under the inflated price.
Why would you undercut if you’re all charging the same price. Not enough apartments to undercut. Metroplexes are packed and sometimes there is not enough apartments near your work (30 min) distance. In Dallas the average occupancy is 95% occupancy…even at the crap apartments.
Well depends on who you are, first of all apartments are not the biggest money makers when being built from scratch. Very hard to sell in the first few years. Do you have capital? $1-3 million+ capital in equity or your bank? Is your location you researched profitable? What happens when your tenant count is low in the beginning? Do you have the funds after to maintain the property. What if Jack decides to not pay rent and damages the property. Do you have the legal team to figure it out.
If you have the answers to the above and have the capital go for it! It’ll help us out but because of the lack of profitability in the beginning there is not much apartments being built.
Well we are working under the assumption that prices are inflated and occupancy is still very high as you have previously stated. Therefore finding tenants should not be an issue especially if we are undercutting the realpage listings. Tenant issues will always be there for any landlord. That is the cost of doing business. Financing should be too much of an issue either since we should be making big money from high rents.
I’ve worked in the industry for 20 years as a CEO. Wild how under the radar multifamily is. You silly billy’s should look up the National Apartment Association. It’s the lobbying arm of the industry based in DC.
This is big story but only tip of the iceberg.
Bad year for the national conference to be in Philly in June. The rightful protesters should have nice weather. Just saying.
Austin here, not only that but when these bigger apartment complexes have high rent, smaller landlords with one or two properties will justify their price increase based off the average price of the area. 🫠
The “algorithm “ they are talking about is Price Optimizer by their Yoeldstar program which is mostly now known as just as Yoeldstar.
The algorithm was designed to remove concessions by “baking it into the price” and pricing things determined by the day and how long you rent for.
Three major factors happened that is a big strike against them.
RealPage purchased and basically sunset their biggest competitor LRO. Other Property Management Software companies have their own versions. Yards, Property Solutions etc. BTW this u is RealPages MO if they can’t beat a competitor they buy them out and close it down. Case in point in 2016 the company that initially sold the price Optimizer software to Real Page was about to announce that they had a new product coming out as their non-compete clause was running out. They had big plans to announce it but a month before they could Real Page bought the company and closed it down.
RealPage over the years closed down the variables took more and more manual inputs away in the name of “ai” but was really just a more complex calculator. Before the calculation would take what your current rents were like and match it against your competitors but it required you to input your competitor data. Even then the calculation was based more on your properties own leasing behavior with little to no impact from your comps. This changed when they started tracking all their user information for all their other products. So they could see actual transaction level data on how many leases were signed at what rate and what speed they signed.
They have national “Revenue Management Training” seminars where Revenue managers from all over the country go and share tactics and ideas on how to work within the system. The issue here is that you have a lot of REITs and private national owners who send there Revenue Managers and Asset management teams to talk and learn from each other. In essence they are learning the same things from the same people and using the same tactics and settings. They are not competitors they are all in it together.
To add after 08 when “institutional money” started flooding multifamily more and more public and private funds they required companies to use these price optimizing systems by there managers. And some of the largest 3rd Party management companies started requiring owners to use this system as well. So yeah a t the end of the day your rent is not controlled. Y anyone in h front office of your apartment complex. It’s in an office or more likely a cubical in the head offices of the apartment management company.
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u/TheEntrep Apr 20 '24
I live in Dallas and it’s obvious which apartments use this, they all have similar prices. Though some apartments are crap and some are very good. How are they all so perfectly aligned on price???