Comment by echoangle
2 days ago
> We also don't see landlords who own their properties outright (and thus don't have mortgage interest costs) charging lower rents than landlords in the neighborhood with identical properties who have mortgages.
Why would they as long as they find a renter? The market always charges the marginal cost.
They will charge the maximum amount possible, no matter what their costs.
And the maximum amount possible is based on the cost of bringing more housing supply to the market aka the marginal cost.
Which comprises
1) Cost of land per year (which won't change as you'd be paying $10k a year tax rather than $10k a year in interest on the loan taken to buy the land)
2) Cost of building per year (which won't change)
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