The Real Reason Your Rent Is So High

meet Jessica Jessica works at a local tech company she likes her job but she’s always felt like she could do more so she was very excited when she got a job offer from a tech startup in the big city but there was one really big problem even with the higher salary they offered there was no way she could afford to pay rent in the big city this is unfair greedy landlords are exploiting vulnerable renters with high prices it should be illegal to charge this much this is a common demand people make and on the surface it sounds like a good idea because it is one not exactly how do I know that was coming the price of anything depends heavily on supply and demand the reason rent is so high in most big cities is because a lot of people want to live there but there isn’t enough housing so that means what is available is pretty expensive you’re telling me normally when the price of something like rent is very high it’s a signal that there’s money to be made providing that thing to others so entrepreneurs start making more of that thing so they can make money and the more people are making a thing the more the price for it decreases as the suppliers start competing with each other but rent control ruins that ruin how could rent control ruin that government already makes creating housing way more expensive than it needs to be through regulatory burdens but when the owners can charge whatever rent seems fair to them there’s at least a chance for them to make back the money they invest it and hopefully earn a profit but when the government puts a cap on the price of housing it becomes almost impossible to earn a profit off of it so yeah the very few people who managed to get rent controlled places to live or happy with their below market price housing but it ultimately makes rent more expensive for everyone else like Jessica here because builders know that the juice just isn’t worth is squeezed so the supply stays low the demand stays high and prices just keep going up I guess that makes sense but if government makes all these rules that cause the price of living to get so high why don’t they just stop why indeed hey guys thank you so much for watching if you enjoyed this video please check out similar educational content at feit org thank you

100 thoughts on “The Real Reason Your Rent Is So High

  • My only concern is on the other side of the wall is letting big business take over all of the housing, and not putting in regulations to prevent monopolization and abuse of the consumers. Obviously the guy charging 10k rent for a lot that he got for free from his daddy is going to be rolling in the dough, and since he's the only one making that dough, he's also the only one who can afford the expensive price tags of the other lots.

    There's no decrease in prices from this. He can just deny anyone who can't meet the price tag and leave the rooms empty! This happens in big cities too! That's why big buildings seem to sit abandoned, it's because no one can afford the extreme rent price and the person who owns it refuses to budge on their price.

    The scenario you set up can also work against your own argument as the people forced to pay these ridiculous prices don't do so because they want to, but because in order to have their 'dream job' they have to, and it essentially makes them poverty stricken workers. o n o I think regulations are required to prevent abuse and monopolies. Monopolies do not equal better business. It makes only 1 guy richer and everyone else around him poorer. It's called being a "slumlord"(it's a real thing, look it up), and I think it should have the horrible name, because abuse of the working class is sickening. Not to mention this will in turn just raise the minimum wage in order to afford these ridiculous prices and thus drive the value of the dollar even lower than it already is. (To put in perspective the hostage situation this creates.) The businesses need workers, the workers need a house, and the business needs consumers. If no one can work because the rent is too high, this forces the business owner to pay more to their workers, but have less workers. This drives supply down for consumers as there isn't enough workers to make the supply of goods they may want, so those consumers go elsewhere. The only guy profiting in this town is the greedy slumlord, while the local businesses and workers bleed income until they either go out of business or leave. Effectively killing a town or leaving the people living there poverty stricken.

    Supply and demand is great, but holding the supply hostage, in my opinion is cruel, and by U.S. law illegal.

  • I already commented, but imagine it like this too, instead of using 'housing business', use 'pyramid scheme business'. c: "Pyramid Schemes are great! Entrepreneurs can make so much money off them, but the government says it's illegal and puts in so many regulations on how to run a business! There's nothing wrong with pyramid schemes, it's all supply and demand! If the entrepreneurs make money they can make more pyramid schemes and make joining one even easier so maybe someone else might get a slice of the pie too!" Ignoring the fact these schemes make the working class poorer and only funnels the money back to one person who is the only one who can afford making more of these 'businesses'. At least that's how I see it. My rebuttal.

  • I’ve been explaining this to all my friends here in California and how the newly passed prop 10 only hurts in the long run. But no one wants to listen. After showing them this video and actually giving them a visual idea, I think some of them might have actually understood that when government gets involved it’s always more expensive.

  • while this is true in places lile Ireland the government is actually controlling the process of building homes through social housing meaning they are forcing renters yo increase there prices as people can get a government home for almost nothing a month

  • As a landlord: you forgot to mention that counties and cities rely on the tax income of property taxes. If there are more people more money is needed for social services. Cities milk landlords. We have to charge higher rent just to make sense of our investment. And a lot of times you can't even argue with the property appraiser. They can make up the rules as they go.

  • Alot of your points for these videos seem to follow the same system. high demand = high cost = conpetition = lower pricesbut that dosent really work if competers work togther to ensure prices stay high which we do see today with big bussiness. In theory this is a great idea but whats to stop landloards talking to each other and deciding that they will never drop rent bellow 2k?

  • The zoning and safety laws reduce the supply of housing thus allowing existing land-owners (the baby-boomers whos wealth ultimately comes from the Native American genocide) to get richer.

  • Here is a simple solution to high rents: goto rural places with low rent (especially rural china & vietnam) and telecommute working as a teacher, consultant, translator, writer, editor, web designer, or programmer.

  • Regulation is beneficial, but you have to be willing to provide things like subsidies if you want to have you cake and eat it too. Without regulations and laws on these kinds of things you can create abhorrent and inhumane conditions, but too much (and without giving enough economic incentive), though you can further debate which regulations are actually necessary, and which are a gregious overstep of authority and power

  • I think its private land owners that rent out houses at high prices that causes the money to raise from employment and not just that raises inflation because they do not produce any more houses and not just that it creates a scarcity in houses and that creates more inflation as the population grows. that's my thought.

  • Lmao its all for taxes then the demand keeps going up due to immigration. Ya capitalism at its best here

  • If it wasn't for some regulations we'd have lead, asbestos and other stuff in our buildings. And yeah sure the market might sort out these bad apples but it would be after the fact.

  • I'll answer the "Why Indeed". Homeowners and landlords in the area vote to keep these prices high (through regulation and zoning) to prop up their current housing values. They have everything invested in the current high values of homes. Cutting in half would ruin them. Many have worked their whole life to afford their home or duplex they rent out. There is no solution to this problem, and to blame 'the government' is pretty ridiculous.

  • lmfao, did you just make me watch some republican trump BS? trying to blame govt. regulation, rent control, ridiculous. fyi, kid, the rent is too damn high even out in the middle of nowhere where there is NO RENT CONTROL. 20 years ago builders could not build houses fast enough to keep up with demand but the problem is everyone lost their jobs because maybe you have heard of the word "recession?"

  • Make something more scarce: Higher prices.

    Canadian western select oil was $11 per barrel, but we cutback production 8.25% and now its back up to $30 per barrel. I mean sure the USA gets less oil and has to pay more for it, but its all roses for Canada.

    Its very easy to make something scarce too, just have lots of rooms that no-one can rent at any price – Capitalism!

  • I forget which city this happened in, but a disabled friend of mine was telling me a story

    This city had wheelchair accessible cabs, but the cost of converting a cab, combined with the extra time and effort needed to help a wheelchair bound person in and out, resulted in a higher price, about 1.5x the normal cab faire, it sucks but that's just how business works

    A group of disabled rights activists didn't like this, so that sued the company, and the courts ruled that they couldn't charge more than 1.25x the normal price

    So now the cab company can't make a profit on them, so they stopped offering wheelchair accessible cabs, save for a few

    So now wheelchair bound people can't get cabs in this city, all because they didn't want to pay for them

  • Doesn't this ignore the fact we have limited space in desired location. Wouldn't there come a time when the free market model no longer works as there won't be a way to expand supply of houses.

  • Soooo… Prices are fine, because people can ask whatever they want for housing? Bullshit. Technically, if a guy asked you for everything you have on a desert for a bottle of water you need to survive, that's technically fine. Doesn't mean it's fair.

    If anything, it shows why mixed economy is failing. Government should be building those houses themselves, not relying on private enterprise.

  • The government passes these laws because they want more votes. People naively assume artificially lower prices are a good thing. This video proves they are dead wrong.

  • Hmm… I mean unecessary regulations are always an issue, for sure, but around here the problem is more that we're running out of places to /put/ more housing. Also that the few places that exist where it could be put (ie: that aren't nature preserves) are already terribly congested with traffic and so the surrounding people already living there don't want more people moving in for safety (getting out of dodge because of fires) or other time-based reasons (can no longer get to work on time without waking up several hours early) and fight against it.

  • Not to mention the section 8 moochers who get free rent paid by the government. Since the government is guaranteed to pay, that drives prices up too, up for everyone even those who have to work for their rent money.

  • Heres what i say to poor people and retired people who cant afford to live in nyc… move to florida. Why is it people who are willing to work for a living move all the time for better living conditions but ask an inner city person on government assistance to move to a state where the cost of living is lower and its like woa hoo hoo hold on, im not moving. Not having alot of money is no excuse to not move. I've relocated god knows how many times with just a bag of clothes and a bus ticket. Started fresh somewhere else. I mean if youre a lazy welfare king or queen who doesnt work, can you not work any where. Why do you have to live in the most expensive cities to live in and not work. Go to a cheaper place to live and be lazy there.

  • Because governments are control freaks.
    The ideal for of government protect our basic liberties, they protect us from the aggression of others but never tries to protect us from ourselves or interfere in the market in any way.

  • Municipal governments are perversely incentivized to artificially inflate land value by restricting the supply of affordable housing, so they can hike property tax rates. Incidentally, this also harms businesses by restricting market growth and increasing tax burden.
    Any bureaucracy only ever serves its own interests, even if you may observe some altruism. Altruism is almost always self-serving.

    Let's have socialism!

  • Is anyone else watching this and disgusted? I call bullshit, because I feel that if we had more regulation on how high rent could be charged, the demand would be the same. However, the landlords would have tennants that stay longer because they can afford the rent. $1,000 is already a ridiculous amount to pay for anything more than a fully furnished home with utilities. $500 should be the average rent price. I'm furious that there is no regulation for this system.

  • We used to rent out the old family house's bottom floor until the rent laws put a cap (right around what we would rent to the ideal renter, that become impossible to find once rent laws are put in place) and then put more laws in that would make it extremely difficult, costly, and time consuming 3 months and sometimes up to 6 months for what is technically a lodger. Now, a small bedroom that we used to rent for a few hundred dollars that essentially came with its own living room, large storage, and bathroom, never gets rented out because all the renters around here that are floating around cost us money to rent to them, while the few perfect renters are hapily locked down with low rent and will rarely ever be available as other landlords know they are hard to come by now because of the laws. It's a little different than rent control but the result is similar. It also pushes real estate prices down while making number of available units less, even if the amount that exists is technically increasing. Heck, a lot of people won't even rent to their family members around here now. I'm in an area with a lot of single-family homes, but not enough for everyone and with somewhat new rent control and renter's protection laws.

    It is at least amusing how these laws make is harder for those people renting which is the opposite of what most of them think these laws do, or what the intent behind them usually is.

  • Governments usually do more damage than help. Regulations seem like a great idea but usually prevent competition and help only the crony capitalists who lobby governments for the regulations they want.

  • Also add land taxes and if you don't live their yourself then you do not get the home steading credits and without those taxes more then triple. Also you are in charge of maintenance of the building.

  • Problem with this argument. I live in an area with extremely high rent as compared to the area, and a very high amount of empty houses to rent.

    No one is building because there's so many unoccupied places to rent. Landlords will AirBnB a tourist for a weekend instead of lowering rent to supply the local population. Also they don't lower rent because the market lies to them and says "one day someone will rent here at high price."

    So what's happening is extremely low income places are overwhelmed, rent for others is unaffordable, and no one is adding housing.

    I don't like government intervention either. But we have a lot of scum landlords who have zero problem exploting people, whom they know have no other feasible option than to live in substandard housing.

    So while the argument here is partly true. I.E. government needs to butt out of people who want to add housing, like in San Francisco.. the argument is B.S. in other places.

    You're not dumb. Are you just niaeve to anywhere but places like New York or whatever large liberal city that you obviously hate?!

  • This leaves out a lot of factors. Appartments do not only compete with other apartments for the ground.
    Other big ground consumers are office buildings. Office space has in recent years been a better investment for buildersdriving up the prices of other ground users like Apparments.
    There are many other factors that i have not mentioned but dont bring this big issue down to a single cause when there are many.

  • I mostly blame the rich people that started the whole NIMBYism thing decades ago. Like, why did you have to push for laws that make it so much harder for builders to build in the first place? They just happened to get lucky, got established there first, but then wanted to fence off everything for others who move in later.

  • Then how would u way about the absurdly high rental prices in Hong Kong? So expensive that people are living in coffin size areas & horrible conditions?

  • regardless of what you are arguing their is an insane amount of human greed in housing. These landlords feel they are entitled to make the big bucks for doing actually 0 work. Passive income. Occasionally fix something (im the guy that fixes the shit and it doesnt cost anywhere near what they tell you). There is a reason all the rich are into real estate. Its because we are sheep, educated to become employees and get a job and pay rent. The entire rental market is nothing more than a scam to take advantage of people that cannot afford to buy their own property. shame on you for making this video and shame on the people charging outrageous prices for trashy accommodations.

  • A way to combat this kind of expensive living is to have roommates to make the rent easier. As well as pay for other bills like gas, water, electricity, etc.

    My family lives in a two bathroom 5 bedroom home in northern part of Southern California. Rent here is approximately $1,600/month we each share a payment. My cousin on the other hand lives in LA and in a 2 bedroom, 2 bathroom apartment and the cost living there is basically the same as our home and they have to pay the rent by themselves.

    It's cheaper to live outside the city, but if you intend on living in one, you should either
    A. Live with another or more people
    B. Live with family who already live there.

    I'm not saying this is the best way to combat the expenses of living in the city, this is just my experience.

  • I Don't Think Goverment Regulation And Supervision Should Be Abolsihed. Free Market Is Always The Best But Without Regulation It's At Sectors Mercy. Remember Human Nature Is Evil Not Just For Communists. I'm No Expert But I Guess Goverment Just Should Regulate And Supervise Rather Then Charge With Extra Money ?

  • Long ago I used to work for my rent, expenses and savings, now I work for my rent, expenses and my landlord's savings.

  • Some big cities like NYC are already close to the limit, in terms of housing density. The solution is: build more cities – Convert existing suburbs into vibrant places where fun things actually happen. The free market will naturally do this, if we get rid of old oppressive zoning laws.

  • Propaganda. First of all, there is a reason for regulations, unless you want to live in a place that collapses on your head. Regulations exist to protect health and safety. Second, if a place is too expensive, don't move there. That's part of supply and demand. Third, supply of housing is often restricted because all of the housing has been bought up by speculative investors like the Blackstone Group or foreigners. Supply is also restricted because the people who already live there don't want to sell their homes, even though their property values are increasing, because there is nowhere else for them to move to that makes financial sense.. Their mortgage is cheaper because they've had it a long time and would have to pay more to live somewhere else not as nice. They are asset rich, and cash poor. Fourth, sometimes a place is just plain full. Many coastal cities are geographically constrained. The real answer is for employers to locate in less popular areas and provide economic development in cities less in demand.

  • So if all the rents for 1 be apartments (even crappy ones in crappy areas) are more than or $100/200 / mo, less than people's total monthly income, where do they expect everyone to live? And that's an average earning not minimum wage. Or the few that are affordable, they require you to make$4/5k/ mo, if I made that much wouldn't want to live in a crappy little place in a crappy area, I could've afford the $1.4k-$2.3k/mo for a decent 1 br. It's really fkd up.

  • What they do is take a crappy little apartment, throw in a couple nice things, like counters or appliances and up the rents hundreds, some a thousand dollars more. It's an excuse for greed, they'd still definitely make their money. Sounds like a vid put out by the contractors that do this

  • One doesn't need to live in the city to work there. Tokyo's population doubles in the day and is halved at night because half the people in the city only work there and go back home outside the city.

  • This video doesn't address what's going on with the market now. People are knocking down available houses to artificially inflate rent and property values. San Francisco is a great example of this. The free market isn't the end all answer. People will cheat a system if they can.

  • Its hard for people to purchase homes because almost everyone has credit issues which get loans denied. Houses just sit vacant for years and therefore people have to rent so the vultures can basically charge as much as they want. The entire system is rigged.

  • Cool! Now explain why ISPs are all in a non-compete status allowing them to comfortably charge higher rates and be monopolistic while collecting massive amounts of money through incentive programs and tax breaks sponsored by big and local government.

  • Rents are high, because of greed.

    We have to move to a cheaper state or country, especially if retired.

  • This video alone is the best reason why you shouldn’t give your government too much power and why you should keep your government out of economics………..for the most part.

  • Leftists do this while at the same time insisting on letting in 1 million more people every year in addition to giving amnesty to all people coming in illegally. Brilliant move

  • Thats why illegals need to be deported. They increase the demand. Not to mention city biuilding codes 700+pages long prevent more housing.

  • So, what you are saying is that the rights of those who want to rent property (their right to make money mostly) is MORE IMPORTANT than the right of myself or my parents to have an AFFORDABLE, INEXPENSIVE yet NICE place to live?

  • This is ridiculous. Building regulations make our houses and environment safer, they don't discourage building. The only thing that truly discourages new buildings is greed. Knowing that they can maximize profit by making the same generic apartment complexes and charging as much as possible for rent keeps the prices high.

  • this is some simple minded libertarian brainwashing bologna that pretends to be smart. Why indeed? Well maybe because we don't want lead in the soil, or buildings to catch on fire, or a pipe to spring a leak, or be at dangerous capacities, or idk be unlivable?? Come on, everybody knows money is the reason rent is high, and it doesn't match expenses. I've worked in the contractor business for a while, they are only concerned with cutting costs and maximizing profits. Everyone in California wanted rent control but another propaganda group such as yourselves, funded by the CAA, spent $83 million to make ad campaigns telling people rent control would make their rent go up. Even this video looks like a parody of some 50s anti-communist prop where little Johnny asks "wouldn't it be better if everyone had access to healthcare?" and the narrator gently chides him "No, Johnny, in fact, free healthcare will cost MORE than healthcare provided by the free market. Get it? Free?"
    I understand how people can fall for this, and I feel bad for them and hope people get their heads on straight and do some research outside of what these think tanks churn out. Think about it, if you're making so much that you can afford to fund a think tank to trick people into paying you even more, wouldn't you do it? When you're haggling, which is part of the so called free market we are sorely missing, you don't believe everything the seller tells you. Think critically!

  • So literally nothing can be done to lower rent? You just have to hope and pray that landlords decide to lower prices? Or the landlords have to decide when they have enough "supply", which will probably be never. So this makes no sense, unless I'm missing something

  • Rent control may lead to supply shortages, but wouldn't rent control also prevent rents from increasing accordingly? It seems like the real problems are zoning laws and low-density development, except for the centers of the very biggest cities where space is already developed about as much as possible.

  • Keep raising the prices on rent, food, gas, etc, etc and a recession will be here before we know it. And it will be more terrifying then the 2008 recession.

  • Rent is too expensive, moving is too expensive and buying is too expensive….America is pricing out the Americans.

  • The problem with this video is, rent is expensive everywhere. Not just in big cities but in small rural areas and towns as well. I live in a very small town with less than 8,000 people and the biggest attraction in my town is a walmart. Rent is still $1500 a month for a 3 bedroom 1 bath house not including Garbage, water and electricity. That's over $2000 a month for a small 3 bedroom home. The truth is that the government has to get their share from literally everything we do and threaten us with jail if we don't pay up, so people raise the price so they can pay our corrupt government and still make a a decent amount. If the kept prices low our government would still take their share and leave little profit to the person renting the house, that's why there are so many regulations and rules, so the government can squeeze every dollar from the people who are actually working hard on making a living

  • You forgot the part where you explain why the rules keep getting added. And that is because, politicians get more votes for doing stuff, and therefor make more money in the long run, plus they can increase their wages.

  • When the economy is doing well…rent increases…when the economy is on the rocks…rent decreases.

  • I feel like this is complete and total BS !!!!!! like piping hot, fresh from the booty hole 🐃💩!! So are we like the only nation in the world with more vacant living spaces than homeless people? (I know we don't have a shortage of homeless people, but that's kinda the point. The number of vacant homes is ridiculous). I live in an area where land developers are building and building and building. These neighborhoods go for 5 years without being filled to half capacity YET!!! rent continues to rise quicker than the cost of living…explain THAT!!! "Supply and demand" HA!!! that's rich

  • They can make plenty of profit without price gouging, even with rent control there's plenty of incentive for companies to build in busy areas with high demand.

  • LOL total BS they compete by hiking price up not down. I'm in Texas there is no regulation here placing limits on how high they can increase rent per year. don't blame the government blame owners greed, after all, they are the ones who set the price hence why rent price rises don't come close to match inflation rise in the last decade.

    The one thing I DO blame the Gov for is how Local Government continues to raise your home value so they can collect more taxes on your homes and in the process, they drag everyone down with them bc mr landlord is not gonna take that cut they will raise the rent.

  • I feel like ownership of apartments should be owned by the city and there should be more incentive to build more houses and apartments

  • In Australia we import terrorists and immigrates that don't know how to spell their own name to tie up public housing to keep the demand for private rentals up so the rich get to bleed the poor for more, that's why Higher society coined diversity is our strength much like the government taxs the poor for smoking, drinking and other fun activities the poor used to enjoy to the tune of it's for your own good.

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