Quote:
Originally Posted by JHikka
Paying off the debt makes some sense within reason, but as long as debt-to-GDP isn't climbing then it's probably fine.
There's not much evidence that this would actually be the case, though. Very similar to the assumption of trickle-down economics. Remember who and what media outlets are asking for double tax to be removed.
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For most modern (investment grade) buildings, let's say you have a pie....your entire pie is your gross revenue, out of which you pay your costs. Under a typical, conventional financing scenario...and in the world as it existed prior to the Great Assessment Hike of 2022....60% goes to debt payments, 15% to general operating costs, 20% to property taxes, and 5% is free cash flow. Profit, if you will.
Now in 2022....taxes are 40% of your gross revenue. You need 20% more pie to be in the same place financially! You can't pay it out of your available cash flow even if you wanted to. You have two choices....raise rent, or default on your debt.
But, you know, greedy landlords
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