The NYC Landlord Who Says the "Golden Age" of Being a Landlord Is Over

Joe Weisenthal (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:16)

And I'm Tracy Alloway.

Joe Weisenthal (0:17)

Tracy, I'm not sure if you remember, but we did an episode recently in the outro, and someone tweeted about this. I think your final line was, It's pretty good to be a landlord. Like, we were talking about rent, and you're like, It seems good to be a landlord. I stand by it.

Tracy Alloway (0:31)

I can't believe I'm getting criticized for throwing out these truth bombs. It's good to be a landlord.

Joe Weisenthal (0:36)

No, I don't think it's even a criticism. It's like sometimes the truest things are the obvious things that no one says directly and that someone just has like, it seems pretty good. And like rent prices, as we've been discussing, like they never seem to go down. There are all kinds of tax advantages, it seems like to owning real estate. It's hard to build more of it.

It seems pretty good.

Tracy Alloway (1:00)

It seems good. I guess my question is, was it always this good? And will it always be this good? Because I mean, the reason we're talking about it is because it does feel like there is a backlash at the moment, or more of a backlash. I guess landlords are never an especially beloved social class.

But with prices being what they are at the moment, with rents going up particularly in places like New York City, it does feel like there is this question of whether or not maybe the government, the state could do something to attenuate those higher rent prices.

Joe Weisenthal (1:32)

I guess there's like two questions to my mind about the sort of like whether it's good to be a landlord. And one is like, okay, we do know that like probably like rent growth is going to slow. And we talked to the guy from Apartment List, Chris Salviati several weeks ago, and he's like, okay, probably like rents are going to come down a bit maybe, or flat, or maybe not grow. But like, there's just a cycle thing, right? And then there's the question of like, is there something deeper that's not just about like the macroeconomic cycle, but is something going to like change about the business?

And you know, like, one thing that I sort of still kind of believe in markets is that like, if there's like alpha somewhere, if there's above market returns, it can't stay forever. Eventually, like it's got to get armed away, right?

Tracy Alloway (2:19)

I think maybe I'm a little bit more cynical than you. I think people will try to hang on to their price advantage as long as they possibly can.

Joe Weisenthal (2:27)

Yeah, no, I mean, I agree. It's just like, they can't be like some business that's just like permanently benefit all the other businesses, right? Like it's not how markets or capitalism are supposed to work. Like capital is supposed to flood in or supply is supposed to come on, and eventually the returns from asset A on a risk adjusted basis should equal the returns from asset B also on a vol adjusted basis or something.

Tracy Alloway (2:51)

Well, I guess this is where we start talking about real world constraints and policy constraints again. But yes, in theory, it should change.

Joe Weisenthal (2:59)

Right, and so we have been talking about real estate quite a lot, and I do think that in this sort of like pandemic slash post pandemic environment, lots of anxiety about real estate, not just like high costs are a huge aspect of it, availability, the types of real estate that people want. And so it's like a good question to like, how good is the landlord market been?

And if we're in a period where a lot of things are changing, rates are reversing before the year.

Tracy Alloway (3:30)

I was about to say, I think interest rates are gonna be the big factor here.

Joe Weisenthal (3:33)

Leverage, huge aspect of the real estate business reversing. Can the golden age of being a landlord persist if many other macro things and political things are changing?

Tracy Alloway (3:44)

Is it still good to be a landlord?

Joe Weisenthal (3:46)

Is it still good to be a landlord? All right, well, I'm very excited about our guest. We're gonna be speaking with Ben Carlos Thypin. He is a real estate investor and broker in New York City. And he has a lot of views on this question and why maybe the golden age is coming to an end or will. So Ben, thank you so much for coming on Odd Lots.