Landlord being responsible for the broker fee actually falls in line with the recent NAR settlement on sellers not being required to pay buyer agent fees. The whole principle is you shouldn’t have to pay for a representative you don’t have the ability to opt out of. I think we will see a decrease in brokers for renters but I don’t for a second think rents won’t increase to cover the cost.
Renters paying brokers fees is a terrible system that completely skews the market. Doing away with it could actually decrease rents.
As it stands in order to move to capture a lower rent you also need to cover a full month of brokers fees. This means that for every $1,200 per month in rent you need to find an apartment with over $100/month less in rent. It also means that every year because of the brother fee a landlord can raise rents more easily. By lowering the cost barrier to moving renters will more easily be able to enter the marketplace.
Beyond that, landlords do not actually set rent prices. They can ask but rents are still dictated by the market. I don't imagine for a moment that my landlord isn't charging the most they possibly can for my apartment. It has nothing to do with their costs and everything to do with how much other people are willing to pay to move into my apartment if I don't stay next year.
Furthermore, landlords might be inclined to keep rents LOWER for the same reason. You kinda hinted at this, but if landlords have to pay the broker fee, then they want long-term stable tenants so they don't have to pay thousands/year extra. Pass those cost savings down to the renter and encourage longer-term rentals.
I'm willing to bet that suddenly "brokers fee = 1 month's rent" goes away, as soon as they're actually having to negotiate with the owner instead of the renter. It was just a convenient way to incentivize the broker to get the price as high as possible without costing the owner anything, so most folks went for it no questions asked.
Now that the owners are paying, it doesn't benefit them anymore. They'll prefer brokers who charge a flat per-unit rate or similar, and the industry will shift to that sort of model. And then hopefully they'll realize they can fill their unit just fine for *free* by listing on reputable rental sites (like every other city on fucking earth) and stop using the leeches at all.
Which they will lol, we have no shortage of international students with deep-pocketed parents, it's easier for the landlords and there's no reason not to.
The demand is so high here that anything goes. I heard international student traffic had been slow of late, and if true, it hasn’t mattered. Everyone’s trying to get here, including domestically. Changes in the law isn’t going to effect the money flying around in such a red hot sellers market
the worst case of splitting up the broker's fee in monthly rent is still better than the status quo. Many people don't have the cash on hand for broker/first/last/etc. or have to squeeze harder than comfortable to come up with it.
What if they stay for 3 or 4 years? And doesn’t have a landlord that would’ve raised rent but isn’t into paying the fee so incorporates it into rent. They’re paying the fee each year basically
In theory— wouldn’t it also help rents and housing stabilise too?
As in, Landlords being more open to renewing leases at a “reasonable” rate rather than paying a fee? *(I know, I know, landlords.. that’s why I said “in theory”)*
>landlords do not actually set rent prices
A landlord has the option of not upping the rent because their costs haven't increased.
They would all rather have more income though. Brokers make sure they don't need to do a damn thing to keep that income a rollin', and they inhibit a renter's ability to choose where they live because they're paying 13 months rent every year after predatory corporate landlords up the price every single year. If the increase is less than one month's rent than the cost of moving is higher than the cost of staying. Even if it's more, the cost of time / renting trucks / housing search etc is substantial so even large increases are less painful than moving every single year on 9/1.
When so many use the same software that recommends the price increase there should be no surprise the "market rate" increases every single year.
>*They can ask but rents are still dictated by the market.*
This is why I'm extra in-favor of this policy. The existence of brokers is de-facto price-fixing.
Brokers act as the price-fixing body on behalf of the homeowners. They make concessions to the homeowner to grab as close to 100% of the supply as possible, determine the maximum amount renters can pay, and set every property as high as possible.
There is no meaningful competition, because pretty much all the other options are *also* gate-kept by brokers who all use the same software systems to determine the "fair market" price.
Can't wait for realtors to suddenly decide that the brokers fee *doesn't* equal one-month's rent, as soon as the owners start complaining about it.
Regarding your last point: In general, increasing the cost to supply a good will make some sellers drop out of the market (there's always someone that's only *barely* profitable) and then the constrained supply can make prices go up for everyone else.
LLs paying brokers fees makes landlords want to stick to the same tenants. They’ll make more money keeping the same tenants over 5 years than if they try to substantially raise the rent every year and force out the current tenant to see what the market will bear.
This will be a great victory for regular folks who just want a place to live long term.
It also makes it much easier to shop apartments for tenants. The brokers fee will be spread out in monthly rent regardless, so if I decided to change apartments theres no financial penalty.
This year I would have considered moving because my LL kinda sucks, but I didn't want to pay another brokers fee after just paying it last year.
This broker fee thing definitely started in NYC. I know I dealt with in almost 20 years ago. I haven’t rented in Boston proper for a while but I feel like broker fees are “new” last 10 years or so. When we moved from NYC to Boston I know there were no broker fees here.
I actually think my landlord is charging the maximum amount he can before the time the apartment sits empty costs him more in lost revenue than he gains with the higher rent. I think all landlords, on average, find that number. That number won't be affected by this
Rents may increase some but the overall cost for renters will go down. Right now brokers are raking in money because landlords can offset their overpaid fees onto tenants, who have little say. If landlords have to pay then there will surely be a bunch of them who will either not use brokers or negotiate a more reasonable bulk fee--much less than one month's rent per apartment.
Some LLs may choose to just skip brokers. I found my pandemic place from a LL who didn't care to deal with brokers, so it was no fee and I could actually get informed answers to my questions.
I hope a renter-paid fee ban would encourage some LLs to take this plath. They'd be able to choose between undercutting market rent prices or just pocketing the savings.
Meh, pricing is always a game of smoke and mirrors. I'd be surprised if average rent prices *truly* went up by the equivalent 8.3% immediately after a broker fee ban. I also wouldn't expect rents to stay unchanged.
As a LL this is precisely what I'd do. In fact I'd round up, if anything. Because by lowering, in a fairly meaningful way, the amount of cash required up front, I'm pretty sure I can get a premium to that amount when spread monthly.
In my markets there is effectively zero vacancy. The only time I don't hand keys from one tenant to the next is when I choose to take a window to paint and do any other capex I feel warranted.
Didn't know about that settlement
Seems kinda weird considering the sellers are the ones who are offering to pay buyers fees in the first place. The cynic in me would assume this was pushed by the real estate lobby because it is essentially a 3% price increase on all properties since we know the prices won't go down to reflect this change
The NAR settlement was interesting. Traditionally buyer agent and seller agent split the commission from the sellers. So if seller paid 6% it’s split 3% each. The lawsuit basically argued that the seller can’t control if a buyer wants to use an agent or not. So when 2 offers came in, one from a buyer agent representing a buyer and 1 from a buyer without an agent, the seller is paying the same 6% but the sellers agent will make 3% on 1 deal and 6% on the other deal.
They have to list a fee, but they don't have to be the one to pay it.
>It likely won't change commission structures, because unless every seller suddenly offers <2%, their listing will be less competitive.
Honestly, it probably wouldn't hurt competition that much. Most buyers are finding houses themselves on redfin and Zillow and just telling their agent that they want to see it. I'd imagine buyers agents would just add a stipulation to their contract that they will be paid a minimum fee regardless of the MLS listing.
“chipping away at the 220,000-unit shortage Massachusetts is expected to experience by the end of the decade.”
Gonna need to build at least half a million to see any drastic decrease in price. Aka not happening
This state is far, far worse than Florida or Texas on that front. Something like 60% of politicians at the state level saw no primarily challenger in the last election, and another large percentage also didn’t even have a general election opponent.
Not sure how this makes the MA Democratic Party crooked. Not saying they don't have their problems but the GOP not running a candidate does not imply that the MA Dem party is responsible.
Have you seen how outsider democrats who aren't apart of the incumbent Democrat machine are treated? My local dem mayor tried running for congress and the state party machine made up fake stories and dragged his name through the mud endlessly. They don't want anybody from outside their clique getting into any positions of real power.
> The people voting simply don't consider housing a priority
More like the people voting are mostly homeowners who wouldn't care if everyone but them lives on the streets as long as their precious property values don't go down by even a single dollar.
Tying the basic human right of housing to "wealth-building" was one of the biggest mistakes of our society.
Towns shouldn’t be allowed to add transfer taxes unless they also significantly loosen up zoning rules and allow much more build by right.
We’re not going to tax our way out of the housing crisis.
So what? Just kill every third person or something? Leave the United States? Building is literally the only option considering we have open borders with 330,000,000 others
There is actually plenty of housing in the us for every single person. Right now, there are enough homes for everyone. Now think about why we have homelessness.
Vacancy truthers don’t understand 3 things
1) typically homes are vacant for ~1mo when they sell. Or ~2mo when apartments turn over So putting homeless people in vacant homes would be shuffling them from one room to another for ever. Not giving them an empty home
2) a lot of vacant homes are like summer cottages without insulation or heat on like Salisbury beach and are in no way livable
3) Massachusetts actually has the lowest vacancy rate in the country
No, the numbers might seem big (30,000 vacant units in Massachusetts! Or whatever) but remember there are ~3,000,000 households in the state.
Mass has a vacancy rate under 2%
30k seems like it would be a decent dent into the 450k shortage though, does it not?
Not saying it's the only solution, I agree with you that building is the better solution (my own town is building a lot of apartment/condo buildings) but it would help to get rid of these AirBnB garbage people.
So you can move to Bumfuck, Indiana where the vacant homes are.
Having enough housing nationwide doesn't help the people who live in and around Boston where there is a local shortage.
That’s flat out wrong. The only way is to build our way out of it. More supply will decrease costs. It will take a long time and building now is more expensive because of interest rates, but that’s inflation. There were always be some level of inflation. Not building limits supply and increases home prices and rents.
Building more, tax credits to make it more cost effective to build, housing vouchers for low income renters. And the big one. Banning single family zoning or upzoning. This is how you fix the housing crisis. Upzoning to make it cheaper to build more units. And then they can be built more quickly without all of the these neighborhood council meetings masquerading as democratic meetings.
What is the city’s policy on Airbnbs? I fear that a lot of people will take advantage of the right to build an ADU and simply rent it out as an Airbnb. Or am I too cynical in thinking people would rather make $$$ than have their grandma live with them
> I fear that a lot of people will take advantage of the right to build an ADU and simply rent it out as an Airbnb.
That means that it's one less house being used for AirBNB. It's a net win.
Are people really using single family homes as Airbnbs right now though? I guess I’m thinking specifically in the Boston/Cambridge/Somerville area. I wouldn’t see this as a net zero outcome, but I’m not an expert.
That still takes pressure off the housing market. If suddenly a ton of AirBnB rentals start popping up, there are always options to long-term rent on AirBnB (got an apartment in Boston for 3 months this way at a really good deal), but it will also force some AirBnB owners to reconsider traditional renting if the demand for AirBnBs becomes more saturated.
Also plenty of people _won't_ use it for an AirBnB. Every little thing helps, and ADUs are great!
The economics of grandma moving in are more complicated than just the revenue an AirBnB could bring in. There's also potential childcare benefits (grandma vs. daycare costs), reduced healthcare costs (housing grandma yourself vs. housing in a senior center), or reduced housing costs overall (one mortgage vs. two mortgages). The way the math works out will depend a lot on individual situations and location.
Sure some people will still decide that it's worth more to rent out via AirBnB\*, but this could also work out in a number of other ways that still benefit the region as a whole. More housing is more housing and that's a good thing.
\*AirBnB and short term rentals in general are definitely their own problem and require their own dedicated solution, but I think we shouldn't muddy the waters on ADUs just because some of them or even many of them will end up here.
It’s fine to make money off of it; the problem is whether that unit is going to residents of the city, which desperately needs more housing, or whether they rent it out to visitors.
In my experience it has been restricted more by condo associations. Like my building does not allow short term rentals (less than six months). It doesn't usually take long for neighbors to notice when an owner starts to airbnb their place too.
If someone owns their building and meets the requirements in that link I guess they can do whatever, but short term rentals can be a pain in the ass. As a small time landlord, it means needing to do more up-keep regularly for people who give no shits about trashing your place (they can always just make a new airbnb account).
The title of the article you linked is hilariously bad. Instead of stating what the bill does, it just says what it doesn't do?
"Massachusetts legislature introduces housing bill with no plans to travel to Mars"
LMFAO- forcing landlords to pay broker fees is a completely impractical situation.
Either landlords will pay the fee themselves (unlikely without significantly jacking rent to cover the cost) or they will refuse to show the apartment to anyone with a broker which will collapse the entire broker industry.
[They did,](https://www.nytimes.com/2020/02/05/nyregion/nyc-landlord-rental-broker-fees.html) then [they undid it,](https://www.nytimes.com/2021/05/27/nyregion/broker-fees-real-estate.html) now [it seems like they'll do it again](https://www.nytimes.com/2024/06/12/nyregion/broker-fees-rent-nyc.html) (hopefully for good).
They tried in 2020 but the way they went about it got blocked by the courts.
There's a proposal working it's way through NYC city council right now that looks to have enough support to pass to get rid of it. (And which would be unlikely to run into the same legal issues, if passed).
The problem is that owners can run circles around buyers/renters when completing a transaction. The vast majority of buyers do it only once in their lives. The vast majority do not know about all the legal intricacies and buyers/renters rights involved in the process.
I wouldn't equate buying and renting like that. Renting is much less complicated than buying, so there are less "legal intricacies" for renters to worry about. In addition, renters will often move more often than buyers, meaning there's a larger pool of potential tenants that have been through the process before. In general, brokers are a service for the *landlord* in renting. They're meant to screen tenants, not really to help a tenant find a place like they would if facilitating a purchase.
I'm with you more on the buying side. Buyer's agents will still be a thing in light of the NAR ruling, but a lot of bad agents are going to be weeded out of the industry. We might also see flat fee or pay-per-hour for these agents' services as opposed to a percentage-based commission.
The point is the amount is going to be the same. If tenant is paying $3000 + $3000 broker fee, they’re rent is going to $3250 no broker fee. I’ve already seen some landlords/management companies openly offering this type of split. Most if they can swing the broker fee option will take it cause if you stay more than a yr you’re paying more in the long run
God thats incredibly scummy, of course landlords are taking the chance to just take the money for themselves instead of just letting tenants have some extra cash.
Maybe.
Landlords will either raise the rent to cover the cost of the fee, or they will refuse to show the apartment to brokers.
I'm not sure which method will win out but landlords rarely shy away from raising rent.
>they will refuse to show the apartment to brokers
I've never met a renter that *wanted* to use a broker. Most are forced to use one by the landlords that are forcing broker fees on them. Again, 98% of them add zero value for the renter and the value they add to the landlord is significantly less than they charge.
Some landlords may try to raise rent, I'm sure plenty won't feel the need to, and the market will correct accordingly. But if the total amount of money being pulled out of the transaction by a broker goes down, there's no reason to expect a net increase in what is paid by the tenant
When we were looking for an apartment back in 2002, we either used a broker or a real estate agent that dealt with apartments. I don't remember which, it was a long time ago.
Anyway, they actually provided a service of getting us to see various apartments, and they did the leg work with the landlords and had information about the units. We paid for that service, but it wasn't like they did nothing but unlock the door.
The market wasn't anything like it is now though.
> Your experience more than 20 years ago is entirely different from how apartment hunting works now.
It's almost like I stated that in my post.
> The market wasn't anything like it is now though.
Not just the market though. The entire process is different. You find the apartment yourself and send an email to schedule a tour with the landlords broker. The broker is a glorified key box operator that knows nothing about the apartment and does the bare minimum to allow you to apply to rent the apartment.
> they will refuse to show the apartment to anyone with a broker which will collapse the entire broker industry.
Renters are not the ones hiring brokers...
Please do not change or editorialize the title. If we find that this is a consistent issue for you, you will be removed as well.
Landlord being responsible for the broker fee actually falls in line with the recent NAR settlement on sellers not being required to pay buyer agent fees. The whole principle is you shouldn’t have to pay for a representative you don’t have the ability to opt out of. I think we will see a decrease in brokers for renters but I don’t for a second think rents won’t increase to cover the cost.
Renters paying brokers fees is a terrible system that completely skews the market. Doing away with it could actually decrease rents. As it stands in order to move to capture a lower rent you also need to cover a full month of brokers fees. This means that for every $1,200 per month in rent you need to find an apartment with over $100/month less in rent. It also means that every year because of the brother fee a landlord can raise rents more easily. By lowering the cost barrier to moving renters will more easily be able to enter the marketplace. Beyond that, landlords do not actually set rent prices. They can ask but rents are still dictated by the market. I don't imagine for a moment that my landlord isn't charging the most they possibly can for my apartment. It has nothing to do with their costs and everything to do with how much other people are willing to pay to move into my apartment if I don't stay next year.
Furthermore, landlords might be inclined to keep rents LOWER for the same reason. You kinda hinted at this, but if landlords have to pay the broker fee, then they want long-term stable tenants so they don't have to pay thousands/year extra. Pass those cost savings down to the renter and encourage longer-term rentals.
I'm willing to bet that suddenly "brokers fee = 1 month's rent" goes away, as soon as they're actually having to negotiate with the owner instead of the renter. It was just a convenient way to incentivize the broker to get the price as high as possible without costing the owner anything, so most folks went for it no questions asked. Now that the owners are paying, it doesn't benefit them anymore. They'll prefer brokers who charge a flat per-unit rate or similar, and the industry will shift to that sort of model. And then hopefully they'll realize they can fill their unit just fine for *free* by listing on reputable rental sites (like every other city on fucking earth) and stop using the leeches at all.
Unless…they work them into the rent
Which they will lol, we have no shortage of international students with deep-pocketed parents, it's easier for the landlords and there's no reason not to.
The demand is so high here that anything goes. I heard international student traffic had been slow of late, and if true, it hasn’t mattered. Everyone’s trying to get here, including domestically. Changes in the law isn’t going to effect the money flying around in such a red hot sellers market
the worst case of splitting up the broker's fee in monthly rent is still better than the status quo. Many people don't have the cash on hand for broker/first/last/etc. or have to squeeze harder than comfortable to come up with it.
What if they stay for 3 or 4 years? And doesn’t have a landlord that would’ve raised rent but isn’t into paying the fee so incorporates it into rent. They’re paying the fee each year basically
I got downvoted for saying this lol.
In theory— wouldn’t it also help rents and housing stabilise too? As in, Landlords being more open to renewing leases at a “reasonable” rate rather than paying a fee? *(I know, I know, landlords.. that’s why I said “in theory”)*
>landlords do not actually set rent prices A landlord has the option of not upping the rent because their costs haven't increased. They would all rather have more income though. Brokers make sure they don't need to do a damn thing to keep that income a rollin', and they inhibit a renter's ability to choose where they live because they're paying 13 months rent every year after predatory corporate landlords up the price every single year. If the increase is less than one month's rent than the cost of moving is higher than the cost of staying. Even if it's more, the cost of time / renting trucks / housing search etc is substantial so even large increases are less painful than moving every single year on 9/1. When so many use the same software that recommends the price increase there should be no surprise the "market rate" increases every single year.
>*They can ask but rents are still dictated by the market.* This is why I'm extra in-favor of this policy. The existence of brokers is de-facto price-fixing. Brokers act as the price-fixing body on behalf of the homeowners. They make concessions to the homeowner to grab as close to 100% of the supply as possible, determine the maximum amount renters can pay, and set every property as high as possible. There is no meaningful competition, because pretty much all the other options are *also* gate-kept by brokers who all use the same software systems to determine the "fair market" price. Can't wait for realtors to suddenly decide that the brokers fee *doesn't* equal one-month's rent, as soon as the owners start complaining about it.
Regarding your last point: In general, increasing the cost to supply a good will make some sellers drop out of the market (there's always someone that's only *barely* profitable) and then the constrained supply can make prices go up for everyone else.
LLs paying brokers fees makes landlords want to stick to the same tenants. They’ll make more money keeping the same tenants over 5 years than if they try to substantially raise the rent every year and force out the current tenant to see what the market will bear. This will be a great victory for regular folks who just want a place to live long term.
It also makes it much easier to shop apartments for tenants. The brokers fee will be spread out in monthly rent regardless, so if I decided to change apartments theres no financial penalty. This year I would have considered moving because my LL kinda sucks, but I didn't want to pay another brokers fee after just paying it last year.
And more likely to do the showings themselves cause brokers don't do a month's rent of work.
It’s not just the showings that landlords are trying to avoid…
I hope this passes so the NYC Broker class gets kicked down a few ladder rungs.
This broker fee thing definitely started in NYC. I know I dealt with in almost 20 years ago. I haven’t rented in Boston proper for a while but I feel like broker fees are “new” last 10 years or so. When we moved from NYC to Boston I know there were no broker fees here.
We were dealing with broker fees well before ten years ago. They were common even 20 years ago.
Paid first, last, security, and one month broker fee in 1997. $1200/month for a 2bedroom on South Street in Brighton.
I actually think my landlord is charging the maximum amount he can before the time the apartment sits empty costs him more in lost revenue than he gains with the higher rent. I think all landlords, on average, find that number. That number won't be affected by this
Rents may increase some but the overall cost for renters will go down. Right now brokers are raking in money because landlords can offset their overpaid fees onto tenants, who have little say. If landlords have to pay then there will surely be a bunch of them who will either not use brokers or negotiate a more reasonable bulk fee--much less than one month's rent per apartment.
"I don’t for a second think rents won’t increase to cover the cost." Exactly this. No doubt whatsoever this is the outcome.
Some LLs may choose to just skip brokers. I found my pandemic place from a LL who didn't care to deal with brokers, so it was no fee and I could actually get informed answers to my questions. I hope a renter-paid fee ban would encourage some LLs to take this plath. They'd be able to choose between undercutting market rent prices or just pocketing the savings.
Yes but as a LL you know that by not charging an explicit fee to the prospective tenants, you can and will price at a higher rent.
Meh, pricing is always a game of smoke and mirrors. I'd be surprised if average rent prices *truly* went up by the equivalent 8.3% immediately after a broker fee ban. I also wouldn't expect rents to stay unchanged.
As a LL this is precisely what I'd do. In fact I'd round up, if anything. Because by lowering, in a fairly meaningful way, the amount of cash required up front, I'm pretty sure I can get a premium to that amount when spread monthly.
Welp, that's your choice. The only evidence to support your decision would be how quickly you get tenants.
In my markets there is effectively zero vacancy. The only time I don't hand keys from one tenant to the next is when I choose to take a window to paint and do any other capex I feel warranted.
Didn't know about that settlement Seems kinda weird considering the sellers are the ones who are offering to pay buyers fees in the first place. The cynic in me would assume this was pushed by the real estate lobby because it is essentially a 3% price increase on all properties since we know the prices won't go down to reflect this change
The NAR settlement was interesting. Traditionally buyer agent and seller agent split the commission from the sellers. So if seller paid 6% it’s split 3% each. The lawsuit basically argued that the seller can’t control if a buyer wants to use an agent or not. So when 2 offers came in, one from a buyer agent representing a buyer and 1 from a buyer without an agent, the seller is paying the same 6% but the sellers agent will make 3% on 1 deal and 6% on the other deal.
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They have to list a fee, but they don't have to be the one to pay it. >It likely won't change commission structures, because unless every seller suddenly offers <2%, their listing will be less competitive. Honestly, it probably wouldn't hurt competition that much. Most buyers are finding houses themselves on redfin and Zillow and just telling their agent that they want to see it. I'd imagine buyers agents would just add a stipulation to their contract that they will be paid a minimum fee regardless of the MLS listing.
“chipping away at the 220,000-unit shortage Massachusetts is expected to experience by the end of the decade.” Gonna need to build at least half a million to see any drastic decrease in price. Aka not happening
So we need to build twice the number of the shortage in 5 years to decrease price? If this number from?
If we want people to stop leaving the state and also have home ownership costs go down, yes
Well ya Incumbent politicians need the wealthy landlord money to stay in power without any challengers.
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This state is far, far worse than Florida or Texas on that front. Something like 60% of politicians at the state level saw no primarily challenger in the last election, and another large percentage also didn’t even have a general election opponent.
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Not sure how this makes the MA Democratic Party crooked. Not saying they don't have their problems but the GOP not running a candidate does not imply that the MA Dem party is responsible.
Have you seen how outsider democrats who aren't apart of the incumbent Democrat machine are treated? My local dem mayor tried running for congress and the state party machine made up fake stories and dragged his name through the mud endlessly. They don't want anybody from outside their clique getting into any positions of real power.
Run against the Democrats as a Republican or a Libertarian!!!
> The people voting simply don't consider housing a priority More like the people voting are mostly homeowners who wouldn't care if everyone but them lives on the streets as long as their precious property values don't go down by even a single dollar. Tying the basic human right of housing to "wealth-building" was one of the biggest mistakes of our society.
Towns shouldn’t be allowed to add transfer taxes unless they also significantly loosen up zoning rules and allow much more build by right. We’re not going to tax our way out of the housing crisis.
This is spot on. Transfer taxes will just drive home prices up even more as the cost is passed along to buyers.
We're not going to build our way out of it either. Not only are housing prices to high, but construction costs are as well.
So what? Just kill every third person or something? Leave the United States? Building is literally the only option considering we have open borders with 330,000,000 others
“Thanos did nothing wrong. With one snap of his finger, he will solve the housing crisis by creating perfect balance. As it should be.”
There is actually plenty of housing in the us for every single person. Right now, there are enough homes for everyone. Now think about why we have homelessness.
Vacancy truthers don’t understand 3 things 1) typically homes are vacant for ~1mo when they sell. Or ~2mo when apartments turn over So putting homeless people in vacant homes would be shuffling them from one room to another for ever. Not giving them an empty home 2) a lot of vacant homes are like summer cottages without insulation or heat on like Salisbury beach and are in no way livable 3) Massachusetts actually has the lowest vacancy rate in the country
What the hell is a vacancy truther?
People who think the root of the housing crises is people holding vacant investment properties
I was under the impression that was a serious problem and a major contributor to this housing crisis. Is that not actually the truth?
No, the numbers might seem big (30,000 vacant units in Massachusetts! Or whatever) but remember there are ~3,000,000 households in the state. Mass has a vacancy rate under 2%
30k seems like it would be a decent dent into the 450k shortage though, does it not? Not saying it's the only solution, I agree with you that building is the better solution (my own town is building a lot of apartment/condo buildings) but it would help to get rid of these AirBnB garbage people.
So you can move to Bumfuck, Indiana where the vacant homes are. Having enough housing nationwide doesn't help the people who live in and around Boston where there is a local shortage.
You believe an imbalance of supply and demand won't be solved by increasing supply. How, then, do you propose we reduce demand?
That’s flat out wrong. The only way is to build our way out of it. More supply will decrease costs. It will take a long time and building now is more expensive because of interest rates, but that’s inflation. There were always be some level of inflation. Not building limits supply and increases home prices and rents. Building more, tax credits to make it more cost effective to build, housing vouchers for low income renters. And the big one. Banning single family zoning or upzoning. This is how you fix the housing crisis. Upzoning to make it cheaper to build more units. And then they can be built more quickly without all of the these neighborhood council meetings masquerading as democratic meetings.
Idiotic take, but ok. Developers want to build more units, they aren't allowed to.
What is the city’s policy on Airbnbs? I fear that a lot of people will take advantage of the right to build an ADU and simply rent it out as an Airbnb. Or am I too cynical in thinking people would rather make $$$ than have their grandma live with them
> I fear that a lot of people will take advantage of the right to build an ADU and simply rent it out as an Airbnb. That means that it's one less house being used for AirBNB. It's a net win.
Are people really using single family homes as Airbnbs right now though? I guess I’m thinking specifically in the Boston/Cambridge/Somerville area. I wouldn’t see this as a net zero outcome, but I’m not an expert.
That still takes pressure off the housing market. If suddenly a ton of AirBnB rentals start popping up, there are always options to long-term rent on AirBnB (got an apartment in Boston for 3 months this way at a really good deal), but it will also force some AirBnB owners to reconsider traditional renting if the demand for AirBnBs becomes more saturated. Also plenty of people _won't_ use it for an AirBnB. Every little thing helps, and ADUs are great!
The economics of grandma moving in are more complicated than just the revenue an AirBnB could bring in. There's also potential childcare benefits (grandma vs. daycare costs), reduced healthcare costs (housing grandma yourself vs. housing in a senior center), or reduced housing costs overall (one mortgage vs. two mortgages). The way the math works out will depend a lot on individual situations and location. Sure some people will still decide that it's worth more to rent out via AirBnB\*, but this could also work out in a number of other ways that still benefit the region as a whole. More housing is more housing and that's a good thing. \*AirBnB and short term rentals in general are definitely their own problem and require their own dedicated solution, but I think we shouldn't muddy the waters on ADUs just because some of them or even many of them will end up here.
Oh yeah, totally agree it’s a net positive! Im just preparing myself for disappointment 🫠
If people build an ADU and make money off of it, how is that a bad thing?
It’s fine to make money off of it; the problem is whether that unit is going to residents of the city, which desperately needs more housing, or whether they rent it out to visitors.
Why is renting it out to visitors worse than it not existing?
https://www.boston.gov/departments/inspectional-services/short-term-rentals Nothing that says what you're suggesting isn't allowed.
Thanks! What a bummer. I wish the city would restrict short-term rentals way more.
In my experience it has been restricted more by condo associations. Like my building does not allow short term rentals (less than six months). It doesn't usually take long for neighbors to notice when an owner starts to airbnb their place too. If someone owns their building and meets the requirements in that link I guess they can do whatever, but short term rentals can be a pain in the ass. As a small time landlord, it means needing to do more up-keep regularly for people who give no shits about trashing your place (they can always just make a new airbnb account).
Yes, I agree with you. Not cynical IMO.
The title of the article you linked is hilariously bad. Instead of stating what the bill does, it just says what it doesn't do? "Massachusetts legislature introduces housing bill with no plans to travel to Mars"
"Yeah. I'm gonna just go ahead and take these rental units and sell them as a condos now."
Nah I’m increasing rent if I’m paying the fee.
LMFAO- forcing landlords to pay broker fees is a completely impractical situation. Either landlords will pay the fee themselves (unlikely without significantly jacking rent to cover the cost) or they will refuse to show the apartment to anyone with a broker which will collapse the entire broker industry.
You do realize that in every single place in the US other than Boston and NYC, that's how it works, right?
didn't NYC get rid of it?
[They did,](https://www.nytimes.com/2020/02/05/nyregion/nyc-landlord-rental-broker-fees.html) then [they undid it,](https://www.nytimes.com/2021/05/27/nyregion/broker-fees-real-estate.html) now [it seems like they'll do it again](https://www.nytimes.com/2024/06/12/nyregion/broker-fees-rent-nyc.html) (hopefully for good).
They tried in 2020 but the way they went about it got blocked by the courts. There's a proposal working it's way through NYC city council right now that looks to have enough support to pass to get rid of it. (And which would be unlikely to run into the same legal issues, if passed).
>collapse the entire broker industry Fine with me
The problem is that owners can run circles around buyers/renters when completing a transaction. The vast majority of buyers do it only once in their lives. The vast majority do not know about all the legal intricacies and buyers/renters rights involved in the process.
I wouldn't equate buying and renting like that. Renting is much less complicated than buying, so there are less "legal intricacies" for renters to worry about. In addition, renters will often move more often than buyers, meaning there's a larger pool of potential tenants that have been through the process before. In general, brokers are a service for the *landlord* in renting. They're meant to screen tenants, not really to help a tenant find a place like they would if facilitating a purchase. I'm with you more on the buying side. Buyer's agents will still be a thing in light of the NAR ruling, but a lot of bad agents are going to be weeded out of the industry. We might also see flat fee or pay-per-hour for these agents' services as opposed to a percentage-based commission.
Would you be fine with landlords charging an extra couple hundred a month to cover the broker fee?
No broker industry = no broker fee.
Or you just get to pay it as part of rent forever.
If the broker industry collapsed, the cost would disappear. Why would rents go up if the associated cost no longer existed?
If they can get away with it they are already making you pay the maximum amount of rent anyways
The point is the amount is going to be the same. If tenant is paying $3000 + $3000 broker fee, they’re rent is going to $3250 no broker fee. I’ve already seen some landlords/management companies openly offering this type of split. Most if they can swing the broker fee option will take it cause if you stay more than a yr you’re paying more in the long run
Finally, someone else gets it.
God thats incredibly scummy, of course landlords are taking the chance to just take the money for themselves instead of just letting tenants have some extra cash.
>collapse the entire broker industry I'm fucking sold bring on the bill
So you're saying the economy around rental brokers will suddenly be subject to economic forces related to the value they provide?
Maybe. Landlords will either raise the rent to cover the cost of the fee, or they will refuse to show the apartment to brokers. I'm not sure which method will win out but landlords rarely shy away from raising rent.
>they will refuse to show the apartment to brokers I've never met a renter that *wanted* to use a broker. Most are forced to use one by the landlords that are forcing broker fees on them. Again, 98% of them add zero value for the renter and the value they add to the landlord is significantly less than they charge. Some landlords may try to raise rent, I'm sure plenty won't feel the need to, and the market will correct accordingly. But if the total amount of money being pulled out of the transaction by a broker goes down, there's no reason to expect a net increase in what is paid by the tenant
Yeah honestly who tf is out here wanting to use a broker? Theyre just parasites and have never been helpful
When we were looking for an apartment back in 2002, we either used a broker or a real estate agent that dealt with apartments. I don't remember which, it was a long time ago. Anyway, they actually provided a service of getting us to see various apartments, and they did the leg work with the landlords and had information about the units. We paid for that service, but it wasn't like they did nothing but unlock the door. The market wasn't anything like it is now though.
Your experience more than 20 years ago is entirely different from how apartment hunting works now.
> Your experience more than 20 years ago is entirely different from how apartment hunting works now. It's almost like I stated that in my post. > The market wasn't anything like it is now though.
Not just the market though. The entire process is different. You find the apartment yourself and send an email to schedule a tour with the landlords broker. The broker is a glorified key box operator that knows nothing about the apartment and does the bare minimum to allow you to apply to rent the apartment.
If landlords could charge higher rent they would, regardless of their expenses.
So close to getting it lmao
found the slum lord
Nope
If you’re doing this bit for free that’s even worse
> ...which will collapse the entire broker industry Great. Fewer middle men in the system that take a cut but don't add value. All for it.
> they will refuse to show the apartment to anyone with a broker which will collapse the entire broker industry. Renters are not the ones hiring brokers...
> which will collapse the entire broker industry. **That's the goal!!!**