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~Neo Landlordism
It’s 4:29 am in the morning Friday, October 22, 2010 while I am writing this essay.
An idea that my subconscious mind conceived while I was asleep woke me up reassuringly which I am willing to share here. Surprisingly I have not come up with a title for this article yet so you people can think one for yourselves to name your versions of comprehension by the end of this article. Basically the idea can be thought of as a tranquil version of the entitlement of the title ‘LANDLORD’. I wish if it could be implemented in future just not because may be I am the first one to conceive the idea that too subconsciously not to make notice of again & again [;P] but hey because I think it’s a great idea and hope you would think the same after reading this essay.
To make you people have an utter comprehension of the idea I would preferably go by the basic definition of ‘Landlord’. A Landlord is a property owner who lends it on rent to another person. So basically a landlord charges for the part of his property he lends. Other enactmentss anerty he rents and or the part of his property he rents and other responsibilities that include on his part are on his part are maintenance, rental collection, etc. But above all these landlords also pays on their part for the revenue they collect by lending their property their ‘peace of mind’. Obviously when you lend your belonging to some other person even if you charge for it you expect the person to take care of it in all due respects. But mostly it doesn’t always go this way. Tenants often fail to meet this very basic expectation of landlords. Most of the tenants deem they are free of any responsibilities once they pay the rent. Such obnoxious and intolerable comportment from a couple of tenants a landlord keeps over a period of time instigates an ignorant behavior on the part of landlords against future tenants to come. So as you can see the very traditional definition of landlord depicts the flaws in its entitlement.
Hey! Maybe this elucidation seem to be very one sided but the solution I would come up later in this article probably be a solution for both the landlords and tenants. The idea goes as this. I contemplate why a landlord take all the pain in the world to build a house, then lend it, subsequently maintaining and collecting revenues from nuisance tenants. The idea is that a property to be built by a builder and sold to multiple people in shares such that there would be multiple owners of the same property “on papers”. For example, a person can own, say, 60% of the property and the revenue collected as the rent can be distributed to each owner as per % of their ownership of the property. Now this property could be lend to tenants with written agreements duly signed by the tenants and the job of maintenance and revenue collection can be outsourced to a third party organization or to the builder itself. Obviously the cost of maintenance will be borne by the party in charge of the maintenance and revenue collection. On the contrary suppose the cost of maintenance is borne by the owners and not by the party in charge of maintenance and revenue collection then the collection of charges could be a complicated case. Also in such a scenario the third party could play a foul game by charging the owners for bogus services. Since the written agreement will be shared between landlords and tenants there is no way out that the third party can forge.
Buying a property in share could be beneficial in multiple aspects.
1. In the above scheme it is possible to switch one’s ownership from one property to another buy selling the shares one currently holds on a property.
2. One can own multiple shares on properties located in different locations. Consider one owns a property and build an apartment on this place. The rents one collects as revenue will be limited to the accommodations’ possible but in case of holding properties in shares there will be no issue as such of limited accommodation. So one’s revenue entirely depends on one’s investment and the number of shares one holds.
3. One can own a share of a property which is in a very demanding location thereby collecting highest possible rent as revenue.
4. One can buy a share of a property on lower cost and sell it at high prices in future. When compared to traditional share trading the idea of buying share of properties is a step ahead. Obviously market share value fluctuates and one can get a return on one’s investment only after selling the shares one currently holds. But in case of holding shares of properties one can collect the rents as revenue until one plans to sell the shares. Also as property is a commodity who’s value is stable over a period of time so one will always be selling shares with an added price.
5. Even if one is not financially in the position of or unwilling to take efforts in building apartments’ ‘as a whole’ he can at least buy shares of properties keeping his investments under the budget.
This scheme also helps in building better relationship between tenants and landlords. In the traditional scheme if tenants and landlords are unable to build a better relationship then the tenants were forced to leave the property which is obviously really painful for the tenants in terms of making new accommodations which is never a case in the newer scheme. Above all tenants will finally be free of imposed baby-sitting and torture of landlords.
This is all I have for now. Hope you would have enjoyed the essay and the idea. Suggestions & Opinions are of course welcome.
