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0 pointsNursie8mo ago0 comments

I live in Perth, Western Australia, and here 5-year price growth has topped 100% in some suburbs. Landlordism is an enormous money-spinner.

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astrange8mo ago· 3 in thread

Until you have to replace a roof, or a tenant destroys the house, or it just doesn't rent for a while and nobody notices a water pipe breaking.

It's risky to own a lot of buildings, and worse the risks are correlated if they're all in the same place (there could be a flood or wildfire etc.)

Commercial real estate is different because your tenants are (more) professional.

ipaddr8mo ago

You get insurance to manage risk. You factor in roof repairs, vacancy rates when determining rent meanwhile your property value over the last 10 years in most places around the world have at least doubled and more.

Doesn't mean the next 10 years will see that growth but if you believe your country/area's population will grow it is probably a good investment for now in the western world.

astrange8mo ago

Insurance is not free money and you can't simply distribute risks among your tenants because the risks are correlated.

Like I said, you can tell it doesn't work because these businesses don't exist. There are essentially no landlords who own multiple single family homes. They do exist for multifamily and commercial.

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NursieOP8mo ago

As the other poster said, these risks can be mitigated in various ways. If the property appreciates 100% over five years, your costs associated with those risks are comparatively minimal.

They certainly don't constitute a depreciating asset!

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