Rent is Getting Too Damn High?

Posted on October 7, 2014 by

An article ran earlier this year, “Rent is Getting Too Damn High?” that has given me pause. In it, the author complains that the rent in Tampa is becoming too high. To this, I’d like to say: Quit whining. I want to challenge people to begin looking at what is happening in the city that is positive, what has happened because a few investors had the courage to step up and put their money where their mouth is by taking a chance. Did they do so in the hopes of making money? Yes—that’s what we all do when we invest. That is what we all do at our jobs.

For years, people have wanted to see this city cleaned up, and now they’re whining that the rent is too high? Here is what I want to know: Where was the author in 2004 when the City Police couldn’t control the deadbeats, the crime, and the prostitution? When there were undesirable tenants in the City Market Building?

Let’s look at what things were like a few years ago. The area in question was a drug haven and a veritable department store of prostitution. Yes, rents were low—they always are when there is a high risk of personal and property safety. This isn’t rocket science.

In 2000, the Telephone Factory Lofts in Atlanta were a pioneer investment. They were surrounded by crack dealers and undesirables. The Federal Government, not the City of Atlanta gave tax incentives for the developer to keep rents affordable for artists. That incentive is now gone. Are the dealers? And when rents doubled there, did people complain? The same thing is occurring in Tampa. You have investors just like the ones reading this article who are willing to invest in the area hoping and praying they will get their money out plus some!

The misunderstanding is that we are not seeing inflation; we are seeing forced appreciation. What you’re seeing is a developer taking a massive risk on an unbelievably big investment. Their payday is due to their vision. They took a huge gamble on an area that is blight in Tampa. Very few developers had the gonads to be able to take that risk. Unless you are one of them, do not point fingers.

When I hear people complaining about rental increases, I have to wonder–Are they willing to take a risk and work toward making this city a better place? Given the lack of solutions in the article, I would say no.

The truth is that in order to stay up with market rents in the redevelopment areas, people will have to continue their education, participate in social organizations, take responsibility for their status in life, and participate to the fullest extent. Good luck to those individuals who have a lack mentality and function from fear. In the meantime, we need to thank the investors who are cleaning up our city and making it a desirable place to live. Oh I forgot to mention the risk takers are providing tax revenue to the “governmental powers” to be spent on other hair brained ideas.

Russ HinerRuss Hiner is an active real estate investor, coach and mentor. Russ is currently the leader of the Atlanta REIA Creative Deal Structuring Group and Atlanta REIA Mastermind Group. Russ also teaches several workshops throughout the year on a variety of real estate investing topics such as Negotiations, Wholesaling 101, Wholesaling 401, Real Estate 101, Property Management and more.

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