Jun 20

Since yesterday’s post on Milwaukee rent stats I’ve spoken to a number of people, both landlords and tenant advocates, who felt rents had significantly increased in Milwaukee over the past couple of years.

I took a look at this using Rent-O-Meter’s rent analytic tool.  (I highly recommend this tool for accurately  setting residential rents) In moderately priced neighborhoods both on the Southside and Northwest, their data is showing that for two bedroom units rents have actually dropped quite a bit from 2016.  Three bedroom unit rents remain stable.

Not sure what to attribute this to.  There has been a softening of occupancy levels over the past year or so, which nearly always causes price corrections.  No money/low money mortgages are reappearing.  That temporarily drives up vacancies, but as we saw in 2008, that bubble pops.

 

 

Rent-o-Meter data NW Milwaukee

Rent-o-Meter data NW Milwaukee

Jun 19

Rents have not changed significantly in Milwaukee (2008-2012) compared to 2013-2017)

What has changed significantly is the number of people paying over 35% of their income in rent.  That percentage DROPPED from 50.1% in 2008-2012 to 45.9% in 2013-2017.

While there is still room for improvement, it looks like the financial status of Milwaukee’s tenants is improving.  This is a good thing for all.

Table is from the US Census Data:
Milwaukee Rental Data From US Census

Milwaukee Rental Data From US Census

Dec 02

Last week my son sent me the following text:

I read this from time to time and thank you for it

The Public Policy Forum a few months back said Milwaukee’s really short of low-cost rentals. If more people went into the business, researchers said, it could help. Yet Ballering, who’s owned for 32 years, told his son to find another occupation: “It’s such a difficult business,” said Ballering.

“There’s better things to do with your life.”

Not what a city in need of rental housing wants to hear from entrepreneurs who provide it.

Source: http://archive.jsonline.com/news/opinion/59534347.html/

The back story:

My son was nearing high school graduation.   I asked him what his plans were.  He said that he was going to follow me into the rental business.  He was initially upset with me when I told him no.  Today he is happy as a partner at a major marketing firm.

Although being in rental housing has done well for me, it is a harsh business.  There is little to no appreciation for the amount of work and risk involved. Many who enter the industry leave broke and broken. Your properties get damaged, your tenants do not pay and, to quote the late Rodney Dangerfield, we get no respect.

The government, who would benefit from successful rental housing, seldom support us or gives us the tools we need to succeed.  As an urban housing provider, you become responsible for the misdeeds of your tenants, while those who commit crimes are often not prosecuted.

There is an eviction crisis.  Yet instead of putting resources towards the causes, poverty and social issues, those claiming to want to solve the problem are providing more resources to free legal helps so that the nonpaying or disruptive tenant can stay a month or two longer due to an undotted i or uncrossed t.

So, yes, being a marketing professional seems like a much better life.

Jul 03

Milwaukee Journal has an article about Milwaukee’s new ordinance that requires deconstruction, as opposed to bulldozing, pre 1929 single families and duplexes.

A Milwaukee ordinance went into effect in January requiring single-family homes and duplexes built in 1929 or before to be deconstructed.


The extended timeline and need for more workers causes deconstruction to often cost nearly twice as much as demolition.

Bloomberg just had a piece on how recycling in general is failing.

Similarly a decade ago or so one of the Milwaukee TV stations followed a couple of DPW trucks full of recycling bin plastics to a landfill. The response was they were ‘just storing them underground’ until they could reuse the plastic.

None of these well-meaning things work as government mandates, but often take off when they are profit motivated.

Look at the electric car. Great for the environment but little interest among the general population. Then along came Musk with his Tesla Roadster. Not a utilitarian, save the planet vehicle, but a quick, sharp looking sports car that enthusiast liked, oh and it also happened to be electric. That changed the topic. His later vehicles are like little high tech spaceships from the Jetsons. Today, there is even Formula E racing, similar to F-1. The buying public, including gearheads, is now getting excited about electric cars and all the major manufactures are racing to beat Tesla. Soon gas may be a thing of the past.

Deconstruction will only work well when there is similar economic motivation to do so, such as a marketplace for used lumber and consumer desire for the materials.

But deconstruction of older properties has the additional problem that many of the materials cannot be reused due to containing lead, asbestos and who knows what other chemicals that will prevent its direct reuse.

 

Feb 01

You now are required to install 10 year sealed battery smoke detectors in Milwaukee. We have the law in a large part because Kiddie, the smoke detector manufacturer,  lobbied hard in Milwaukee for the law.

The sales literature claims the life to be ten years from the activation. Now if the ten year detectors actually worked for ten years, without being removed, disabled, or the battery dying they would be a bargain for owners compared to replacing batteries once a year.  However, will they?  I doubt it.

The marketing of a ten year detector may in fact cause more problem as home owners and perhaps some landlords will think ‘Okay, this January 2018, I’ll make a note on my calendar to replace the detectors in December 2027.’ and not continue to check them annually at least.

 

Let’s be clear: You still need to check the ten year units, just as you did with the regular units.

A worrisome fact is they have an “off” selector that drains the battery and permanently disables  the unit. From their literature

 

Q: How do I disable my alarm?
A: Remove the alarm from the mounting plate by rotating it counterclockwise (as indicated by the arrows on the cover of the alarm). Next, on the back side of the alarm, locate the area marked with a long arrow on the product label. Break through the label with a screw driver and turn the screw to the “OFF” position. This will deactivate the alarm, stop the end-of-life warning and render the alarm safe for disposal by draining the battery.
IMPORTANT: Deactivation of the alarm is permanent. Once the alarm has been deactivated, it cannot be reactivated or mounted back onto the mounting plate and will no longer detect smoke or carbon monoxide. This is why it’s imperative to replace your alarm immediately.
The ten year warranty only covers repair or replacing the unit, not the damage caused by them failing to work in a fire seven years from now,  your labor to replace them or even the postage to and from the manufacturer.  Some highlights of one warranty:

 

The obligation of [manufacturer] under this warranty is limited to repairing or replacing the alarm or any part which we find to be defective in material, workmanship or design, free of charge, upon receiving the alarm with proof of date of purchase, postage and return postage prepaid,
 
 In no event shall the Manufacturer be liable for loss of use of this product or for any indirect, special, incidental or consequential damages, or costs, or expenses incurred by the consumer or any other user of this product, whether due to a breach of contract, negligence, strict
liability in tort or otherwise.
 
The Manufacturer shall have no liability for any personal injury, property damage or any special, incidental, contingent or consequential damage of any kind resulting from gas leakage, smoke, fire or explosion.

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