Slum landlord business model dying

Changes in technology change other areas. Human beings have a bizarre tendency with respect to those changes – they tend to overestimate change in the short term and underestimate change in the long term. Take landlords as a classic example. The basic business model has remained essentially unchanged over an extended period of time. It would be easy to think that communications, of all things, would have little effect on things. It would also be wrong.

People stay with bad landlords for one of two reasons. One is recurring cost – they cannot afford to go elsewhere because the monthly expense exceeds their budget. The other is switching cost – The cost of moving elsewhere exceeds the present edvantage of doing so. The first is not affected by advances in communications. The second, however, is affected – and affected strongly.

Take as an example my landlord. I live at Tamarus Park Apartments in Las Vegas, Nevada. After fighting with them over the last year to fix the roof, make the swimming pool and hot-tub which I am paying for as part of my rent fit and safe to actually use, and generally perform their duties as caretakers of the facility in an adequate manner, I finally decided to move. So far, this is a normal situation for them – they will simply get another tenant to squeeze.

Unfortunately for them, the situation is changing. Now – pissing off a tenant leaves it far more likely that they’ll blog about their problems instead of wasting their anger with mere yelling. One or two such posts will likely be ignored – as they properly should. Over time, however, a search for say “Tamarus Park Apartments Las Vegas” would start to turn up these other websites. This will turn up as younger generations, already used to searching for information on the Internet, research prospective apartments.

Over time, I expect that this will have an effecto on the ability for landlords to replace tenants they have mistreated. Basically, the current business model employed depends on a scarcity of communications which no longer exists. I expect the next two decades to be interesting ones as this plays out.

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