Most fast food workers in California would get a $20 minimum wage next year — a nearly $5 per hour raise — under a deal announced Monday between labor unions and the industry that will avoid a costly referendum on the November 2024 ballot.
But like, how can they milk us for more than we're able to give?
Yeah, you can charge $100 billion for a studio apartment, but nobody is going to buy it.
The same logic is at play for raising rent. You can't raise it beyond what people can pay, or else you'll lose customers and make less money overall.
Not sure why this needs to be explained to you. You think they're refusing to charge $100 billion for a studio apartment out of the goodness of their hearts? Lol. No. It's market forces.
The real answer that no one is giving you is this:
Aggregate demand for housing in the area is through the roof, which is why prices are actually rising. If you move out because you can't pay, there will literally be hundreds, or more, people lined up who can - this incentivizes raising the price because the market can clearly handle it.
But like, how can they milk us for more than we’re able to give?
The logic of the market is that if there's anyone in the market that can afford it, whether or not you can't isn't their problem, it's yours.
This is one of the basic reasons why wide income inequality is a problem- when the going housing market rate is a measure of what the wealthy people in that market can bear, it creates serious problems for everyone else. For example, the median home in Seattle lists at $800k and that's not a measure of what the median earner can afford, it's a measure of what Blackrock is willing to pay to outbid folks earning in the $250k/yr range.
Like someone not understanding that minimum wage workers not being able to afford to live where they work is different than ANYONE being able to live there?
Weird.
“I took micro economics and I think I’m smarter than everyone cuz I’ve never heard macroeconomics exists.”
I'm purely talking about rent prices. Not who and who cannot pay it. Rent is going to be priced to maximize profit. This means as soon as people can pay more, they will charge more.
If an apartment complex sees they can make more money by raising rents above what those making minimum wage can pay, then any minimum wage tenants will be replaced by those with more money.
I wholeheartedly believe everyone who doesn't understand this is looking at the downvotes first, and logic second.
The amount of nonsense I had to read in this comment chain is appalling. But it just shows me the vast majority of you don't understand basic economics, yet think you do because you agree with people who are wrong.
People will pay whatever it takes to not be homeless. If that means 75% of my paycheck is going to a shitty apartment, then i have to take on more debt to afford things like food. Landlords will continue to squeeze until something breaks.
People are debating you because you're operating under a different definition of "able to pay". Yes technically they can't get blood from a stone. If I make $100 dollars a month they can't charge me $101 for rent or I can't live there. But under the "30%" rule I shouldn't pay more than $30 in rent, the theory being that I need the additional $70 dollars a month for utilities, food, gas etc and in theory I still have some left over for savings, incidentals, etc.If all the landlords in my area are charging $50 in rent for a studio I can technically pay that, but somethings taking a hit in my budget and it probably won't be utilities (running water), food (got to eat), or gas (gotta get to work) so it'll be my savings, incidentals, etc funds. Now I have no savings and can't pay an emergency expense like a flat tire because that extra $20 a month I could have saved went to my rent because I could "technically pay it."
The way your comment is worded makes it sound like you probably think living check to check is a personal choice because someone didn't want to tug on their boot straps hard enough. Should the market adjust if people dont want to pay a certain amount in rent? In theory, yes. The reason rent is skewed away from the consumer in a traditional market adjustment is that people need a place to live. So theyll keep paying till they literally can't and become homeless. If we were talking about the cost of luxury items then the market adjustment would be much quicker because people can afford not to buy parrot petting poles but it's harder to just quit buying it when its food or rent and that makes it ripe for abuse.
The way your comment is worded makes it sound like you probably think living check to check is a personal choice because someone didn’t want to tug on their boot straps hard enough.
I have no idea where you guys are getting this from.
My point is simple, but I feel like the downvotes had their snowball effect and people who can't think for themselves are doing mental gymnastics to fit in with the crowd.
Holy shit dude. Literally everyone is telling you you're wrong, some nicer people are even taking time to politely explain why you're meeting so much resistance to your opinion. And you're just shoving your fingers in your ears and screaming NAH NAH NAH I can't hear you GROUPTHINK DOWNVOTES ME RIGHT YOU WRONG.
Its fucking exhausting trying to help people like you. Why anyone tries is beyond me. Enjoy your inability to think critically and assurance of your correctness. Don't fucking bother replying
Existing tenants priced out will choose not to renew their leases or default. That rids them of anyone not able.
Then they can set the rent as high as they'd like, because there's s no shortage of venture capitalist vampires that'll pay way over market for an apartment if they think they can make money off it. They'll pull perfectly good housing stock off the market so some shady LLC or foreign national can continue to treat real estate like securities, or even just sit on it, vacant.
How can they raise the rent beyond what people are able and willing to pay?
Because they don't give a shit. They'll milk us all dry till we're living 10 people in a 3 bedroom
But like, how can they milk us for more than we're able to give?
Yeah, you can charge $100 billion for a studio apartment, but nobody is going to buy it.
The same logic is at play for raising rent. You can't raise it beyond what people can pay, or else you'll lose customers and make less money overall.
Not sure why this needs to be explained to you. You think they're refusing to charge $100 billion for a studio apartment out of the goodness of their hearts? Lol. No. It's market forces.
The real answer that no one is giving you is this:
Aggregate demand for housing in the area is through the roof, which is why prices are actually rising. If you move out because you can't pay, there will literally be hundreds, or more, people lined up who can - this incentivizes raising the price because the market can clearly handle it.
The logic of the market is that if there's anyone in the market that can afford it, whether or not you can't isn't their problem, it's yours.
This is one of the basic reasons why wide income inequality is a problem- when the going housing market rate is a measure of what the wealthy people in that market can bear, it creates serious problems for everyone else. For example, the median home in Seattle lists at $800k and that's not a measure of what the median earner can afford, it's a measure of what Blackrock is willing to pay to outbid folks earning in the $250k/yr range.
I mean, I totally agree with what you're saying.
I don't think it should be this way, but it is.
Blame capitalism. Maximizing profit, by definition, is doing the least while charging the most.
That's a very simplistic view and ignores the effect of competition to prevent doing the least
Said effect doesn't exist, it's an illusion caused by small insular markets.
Have you ever worked in sales?
Yes, I have. I also have studied economy and finances at a degreed level.
"Credit cards"
You still don't understand, lol.
Even if people were relying on credit cards to pay, there's still a limit that landlords would have to price around.
My god. This is why this generation sucks with money, lol. Most of you don't have a clue what's going on yet think you're being clever.
Ahh well.
Removed by mod
Millenia, actually.
Well… if you look at this comment chain you'll get an idea of how bad it is lol.
Like someone not understanding that minimum wage workers not being able to afford to live where they work is different than ANYONE being able to live there?
Weird.
“I took micro economics and I think I’m smarter than everyone cuz I’ve never heard macroeconomics exists.”
What are you even talking about?
I'm purely talking about rent prices. Not who and who cannot pay it. Rent is going to be priced to maximize profit. This means as soon as people can pay more, they will charge more.
If an apartment complex sees they can make more money by raising rents above what those making minimum wage can pay, then any minimum wage tenants will be replaced by those with more money.
I wholeheartedly believe everyone who doesn't understand this is looking at the downvotes first, and logic second.
The amount of nonsense I had to read in this comment chain is appalling. But it just shows me the vast majority of you don't understand basic economics, yet think you do because you agree with people who are wrong.
Sad.
Yeah, I'm incredibly confused here. You are talking first week of Econ 101 stuff here and people somehow think your points are debatable? Jesus.
From the looks of it, you ONLY have the knowledge of said "first week of economy 101".
People will pay whatever it takes to not be homeless. If that means 75% of my paycheck is going to a shitty apartment, then i have to take on more debt to afford things like food. Landlords will continue to squeeze until something breaks.
People are debating you because you're operating under a different definition of "able to pay". Yes technically they can't get blood from a stone. If I make $100 dollars a month they can't charge me $101 for rent or I can't live there. But under the "30%" rule I shouldn't pay more than $30 in rent, the theory being that I need the additional $70 dollars a month for utilities, food, gas etc and in theory I still have some left over for savings, incidentals, etc.If all the landlords in my area are charging $50 in rent for a studio I can technically pay that, but somethings taking a hit in my budget and it probably won't be utilities (running water), food (got to eat), or gas (gotta get to work) so it'll be my savings, incidentals, etc funds. Now I have no savings and can't pay an emergency expense like a flat tire because that extra $20 a month I could have saved went to my rent because I could "technically pay it."
The way your comment is worded makes it sound like you probably think living check to check is a personal choice because someone didn't want to tug on their boot straps hard enough. Should the market adjust if people dont want to pay a certain amount in rent? In theory, yes. The reason rent is skewed away from the consumer in a traditional market adjustment is that people need a place to live. So theyll keep paying till they literally can't and become homeless. If we were talking about the cost of luxury items then the market adjustment would be much quicker because people can afford not to buy parrot petting poles but it's harder to just quit buying it when its food or rent and that makes it ripe for abuse.
I have no idea where you guys are getting this from.
My point is simple, but I feel like the downvotes had their snowball effect and people who can't think for themselves are doing mental gymnastics to fit in with the crowd.
Holy shit dude. Literally everyone is telling you you're wrong, some nicer people are even taking time to politely explain why you're meeting so much resistance to your opinion. And you're just shoving your fingers in your ears and screaming NAH NAH NAH I can't hear you GROUPTHINK DOWNVOTES ME RIGHT YOU WRONG.
Its fucking exhausting trying to help people like you. Why anyone tries is beyond me. Enjoy your inability to think critically and assurance of your correctness. Don't fucking bother replying
They don't?
Existing tenants priced out will choose not to renew their leases or default. That rids them of anyone not able.
Then they can set the rent as high as they'd like, because there's s no shortage of venture capitalist vampires that'll pay way over market for an apartment if they think they can make money off it. They'll pull perfectly good housing stock off the market so some shady LLC or foreign national can continue to treat real estate like securities, or even just sit on it, vacant.