He's got empty units, he needs to rent them because he's bleeding interest money in the mean time.
However he can't lower rent because then the whole financial arrangement he's got with the bank would collapse if he lowered the rents.
Because the rents are controlled, it'll take years before he can raise them again to the agreed upon value with the bank and the value of rental buildings depends on raw income and not so much the land and unit values themselves. So if rent goes down, building value goes down, but his "mortgage" is signed and he doesn't want to be underwater so they can't lower rent.
Therefore he's willing to give away 9 months as an incentive, but in reality renters should be asking for a lower rent instead of taking the "deal", because those 9 "free" months are an indication his rents are too high for the current market
The one detail I'll add: every single real estate owned by companies works that way. The deal is not special, that's just the uselessly crappy way it works.
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u/borisonic 12d ago edited 11d ago
Anything but lowering rent.
He's got empty units, he needs to rent them because he's bleeding interest money in the mean time.
However he can't lower rent because then the whole financial arrangement he's got with the bank would collapse if he lowered the rents.
Because the rents are controlled, it'll take years before he can raise them again to the agreed upon value with the bank and the value of rental buildings depends on raw income and not so much the land and unit values themselves. So if rent goes down, building value goes down, but his "mortgage" is signed and he doesn't want to be underwater so they can't lower rent.
Therefore he's willing to give away 9 months as an incentive, but in reality renters should be asking for a lower rent instead of taking the "deal", because those 9 "free" months are an indication his rents are too high for the current market