"Buyers aren't going to pay more for apartment buildings because rents are up due to more taxes because they are smart enough to know those taxes come out of their rent collections such that there is no added net value to them. I've been there. It ain't hard."
Lol!!
Yes, they are, and it happens all the time... UNLESS you're a slum lord who doesn't take care of the properties so that they are needing a lot of repairs and updates just to approach market value.
The value of a rental (property) is based on the rent and the occupancy, as well as market value of similar properties.
If your property is updated and has a great occupancy rate at the rent being charged, it ABSOLUTELY has a market value based on the greater of that rent or the market value of comps. You could be an idiot and in a sale take less than market value for said property, but if you are not an idiot, you wait for the right buyer or market to come along. If you NEED to sell, you're always at a disadvantage in the market. If you don't need to sell, you can set your price until the market improves for your property.
If your property tax goes up for any reason, and you don't pass that added cost+ along to your tenants through rent, your for profit business model is not sustainable (just like any other business).
It's absolutely that simple and not "hard" at all.
*highlighted for those who don't read so well
Lol!!
Yes, they are, and it happens all the time... UNLESS you're a slum lord who doesn't take care of the properties so that they are needing a lot of repairs and updates just to approach market value.
The value of a rental (property) is based on the rent and the occupancy, as well as market value of similar properties.
If your property is updated and has a great occupancy rate at the rent being charged, it ABSOLUTELY has a market value based on the greater of that rent or the market value of comps. You could be an idiot and in a sale take less than market value for said property, but if you are not an idiot, you wait for the right buyer or market to come along. If you NEED to sell, you're always at a disadvantage in the market. If you don't need to sell, you can set your price until the market improves for your property.
If your property tax goes up for any reason, and you don't pass that added cost+ along to your tenants through rent, your for profit business model is not sustainable (just like any other business).
It's absolutely that simple and not "hard" at all.
*highlighted for those who don't read so well
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