May 22
A lot of PhDs say the same thing we’ve said for years about landlording in general and Section 8 in particular in peer reviewed papers.  Typically we only see those critical of owners, but there are many that accurately explain the dynamics of rental housing.
Here is a excerpt from two.
 
How to attract more landlords to the housing choice voucher program: a case study of landlord outreach efforts –  David P. Varady , Joseph Jaroscak b and Reinout Kleinhans
Our interviews suggest that existing stereotypes of Section 8 (HCVP) landlords as greedy and unconcerned about their tenants are inaccurate. Moreover, our findings provide new support for the classic studies of inner-city landlords cited earlier. Currently, many landlords in the HCVP are themselves experiencing significant financial burdens and risks as they try to deal with the low-income rental market. Tenants exhibiting various forms of problematic behavior, such as drug dealing, substance abuse, and violent crime, exacerbate the problem.
Urban Landlords and the Housing Choice Voucher Program – Prepared for U.S. Department of Housing and Urban Development by The Poverty and Inequality Research Lab Johns Hopkins University Philip Garboden Eva Rosen Meredith Greif Stefanie DeLuca Kathryn Edin
Of small properties with affordable rents (below the regional median), only those without debt service are viable. Only 25 percent of mortgaged properties have positive cash flow (Garboden and Newman, 2012). Taken together, these quantitative analyses and our own findings described in the following suggest that much of the stock is financially precarious, which could theoretically lead to under maintenance, abandonment, and conversion.
June 11th, 2018: The publication is back up on HUD USER at a new address above
Note: this publication has been removed from HUD USER.  I reached out to the authors who said it will be reposted soon, that the removal was to improve the formatting
Apr 23

Heartbreaking Photos Of Eviction Day In America

Matt Desmond’s NYT best seller “Evicted” is impacting our industry in ways that even he probably never predicted.

In speaking to him, my company had a small mention in the book as well as Desmond and I were on an NPR broadcast on evictions, I do not feel he is anti landlord, nor that he puts the blame solely on our industry. Rather his objective appears to be universal housing vouchers, kind of Rent Assist on steroids.

Let’s face it, evictions are economically hard on rental property owners as well. Anything that would address the root cause would be good for owners and tenants alike.

But many “advocates” are reading the title of the book, and probably not much more than that, combining it with the eviction statistics Desmond has assembled and are using this as a rallying cry to end all evictions, blaming landlords in the process. They fail to realize or admit that tenants that do not pay rent or are causing problems are increasing the costs to those tenants who are paying as they should.

Mar 17

(This is an updated post from ten years ago.  Unfortunately little has changed in the past decade)

Some days there seems to be no limit to attempts to cheat rental property owners out of their hard earned money. Tenants, the City and WE Energies all seem to stay awake nights figuring how to get your last few bucks.

In the past month many owners have asked ‘What is my responsibility to pay for separately metered utilities when the tenant moves or doesn’t place the account in their name?’ and then go on to tell their tale of woe, describing how WE Energies is attempting to extract money from them for utilities they do not believe they owe.

Where do we begin? This is a fairly complex area. Here is my attempt at a simplified overview. Remembering you should hire an attorney when you need one, and even when you think you don’t need one if there is a lot of money involved.

Let’s start with the applicable law, Wisconsin Statute §196.643 Owner responsibility for service to rental dwelling unit.

(1) Responsible party. When a customer terminates service to the customer’s rental dwelling unit, a public utility shall make reasonable attempt to identify the party responsible for service to the rental dwelling unit after the customer’s termination. If a responsible party cannot be identified, the public utility may give the owner written notice by regular or other mail of the public utility’s intent to hold the owner responsible for service to the rental dwelling unit. The owner shall not be responsible for service if the public utility does not give the notice under this subsection or if, within 15 days after the date the notice is mailed, the owner notifies the public utility of the name of the party responsible for service to the rental dwelling unit or notifies the public utility that service to the rental dwelling unit should be terminated and affirms that service termination will not endanger human health or life or cause damage to property.

Seems pretty simple. In order to place a utility bill in your name the public utility, WE Energies in this case, MUST attempt to find out who is responsible for the service. If they can’t determine who is responsible and they want to place the account in your name they MUST send the property owner a letter AFTER the tenant’s termination of service date. That letter MUST give you 15 days to respond. Your response can be 1) you want the account in your name; 2) you can provide the public utility with the name of the party responsible for the bill; or 3) you can ask the utility to simply turn off the service. Do nothing within the 15 days and the bill is placed in your name.

Here’s some areas where WE Energies cuts corners and attempts to put bills in your name improperly:

  • The 15-day letter is the trigger for billing an owner. Prior to sending the letter, however, “ public utility shall make reasonable attempt to identify the party responsible for service to the rental dwelling unit after the customer’s termination. ” and only after the public utility can’t determine who is responsible may they send the letter.
  •  

  • WE Energies often (always?) sends the letter without first attempting to identify the responsible party, making the letter invalid.
  •  

  • WE Energies often sends the letter prior to the termination date of the tenant. The statute requires the process to begin “after the customer’s termination” making a letter sent prior to the tenant’s termination invalid. How can an owner determine if the power should be turned off or provide the name of the responsible party prior to the the current tenant leaving? You can’t. Many times the vacating tenant doesn’t leave on the date they should. Some holdover for a day, a week, a month or they simply change their mind about moving. Maybe the roomate who has the power in their name is moving and the other roommate is staying. Other times the letter comes more than 15 days prior to the current tenant’s termination date but by the time they do move you have a new tenant.
  •  

  • WE Energies often calls you, rather than sending the letter, expecting an instant answer when you haven’t had ample time to assess the situation. You may not even know the tenant is vacating. A call is not a letter. Think about it in terms of our responsibility to send a deposit transmittal letter.. ‘but your Honor, I called them and told them I was keeping the deposit so I didn’t need to send the required letter.’ The same standard should apply here.
  •  

  • WE Energies sends you a bill a month, a year or more after the fact without ever sending the letter, expecting you to pay for utilities used prior to you receiving any notice from WE Energies. There can be no proper owner billing prior to the date the letter was sent to you. 
  •  

  • Remember no proper 15-day letter- no legitimate bill, even if you spoke to them on the phone. If WE Energies first attempted to identify the responsible party AFTER the termination date and then WE Energies sent the letter to the property owner, but you ignored it there is probably no defense to the bill. In many cases you will find that WE Energies will have failed to follow the proper procedure beginning with the requirement that they attempt to identify the responsible party prior to sending a letter.
  •  

  • An area of disagreement is the definition of responsible party. Many rental agreements hold the tenant contractually obligated to provide heat to the property until the last day they are liable for rent. That would appear to make the vacating tenant the responsible party until the last day they are legally liable for the unit. WE Energies take the position that the occupant’s responsibility ends the day they said they moved out, even if that date is weeks before their month to month tenancy would terminate or months before their yearly lease terminates.
  •  

  • Another area WE Energies attempts to trick property owners into paying bills that are not theirs is by placing the bill in your personal name and attaching that bill to your home account while the property is owned by an LLC or other entity. The law only permits the bill to be placed in the name of the property owner. 
  •  

  • The WE reps will often tell you that they can’t place the bill to your new tenant unless you provide personal information on the tenant including their Social Security number. While you must provide their name and there is probably no problem providing their prior address, third party disclosure of credit information such as the tenant’s Social Security number is a violation of the federal Fair Credit and Collections Act. Penalties for FCRA violations are severe. WE Energies’ attorneys admit they cannot require you to provide this information.
  •  

  • Additionally WE Energies attempts to make it difficult for you to turn off the service by demanding that you meet the WE Energies service person who will arrive at the property between ‘8AM and noon’ on a Tuesday. While the Public Service Commission does require the public utility to assure that the unit is empty prior to disconnect, there is no requirement that you have to waste half a day to meet them.

 

Mar 11

Follow up to the Milwaukee County Proposal on making Rent Assist a protected housing class.  with a hearing is Monday March 12th, 9:00 AM at the Milwaukee County Courthouse building, Room 201B,  901 North 9th Street,  Milwaukee, WI 53233

My company accepts,  and likes the Rent Assist program.  We also have not found the inspections particularly cumbersome.  In our market we see Rent Assist as a benefit to both owner and tenant.

Yet, I oppose the bill.

  1. Mainly because it attempts to hide the fact that the true reason that people do not get Rent Assist is that Milwaukee County does not provide as many vouchers as there are folks eligible to receive vouchers.If Ms Dimitrijevic wanted to help tenants in need of Rent Assist she would look at her own branch of government and say ’We need to increase the available vouchers.’  If that was her proposal the Association and I would fully support her, as would most tenant advocates.Instead she tries scapegoating owners, making it look like discrimination against voucher holders is the problem.
    Ask Ms Dimitrijevic if there are more applicants than vouchers and how many months or years the Rent Assist waiting list is.The other reasons I oppose this are:
  2. Rent Assist does not allow for month to month occupancies.  Owners are more likely to take a chance on a questionable applicant if they can use a month to month and terminate tenancies that are not working as expected.  If you are a tenant, I’m sure you do not want to live in an apartment next door to a disruptive neighbor and when you complain the owner tells you that this person that is making your apartment less enjoyable has to stay for 11 more months due to a year lease.
  3. Another issue is that per the RA contract an owner must serve both the tenant and the RA agency with notices of default, such as non payment.  This creates an additional opportunity for an eviction for good cause to have problems.
  4. Finally, an owner may have to wait for the first payment.  While not a concern to our company, this is a big problem for mom and pop owners who are often under capitalized.

What the bill actually does.

Supervisor Marina Dimitrijevic, the bill’s author,  states on FaceBook:  “This change to the ordinance does not mandate acceptance of certain sources of income rather it makes it illegal to discriminate against tenants based on source of income.”  The bill is worded consistent with her statement.

Currently.

Prospective tenant:  ‘Hi, I have a Rent Assist voucher.  Will you accept my app?

Landlord:  ’Sorry.  We do not do Rent Assist.’

Prospective tenant:  ‘Okay,  There are thousands of other owners that love the program and I am one of a few tenants who are eligible.’ and under her breath says ‘What a donkey’

Result: The tenant does not waste time and possibly money apply for a unit they will not receive.  Everyone understands upfront.  And the owner who does not accept the Rent Assist voucher holder loses a  great tenant, and the accompanying revenue,  that we end up with. 😉

Image what a terrible experience this will be for the tenant under the new law if they apply with an owner that will not accept Rent Assist vouchers.

Prospective tenant:  ‘Hi, I have a Rent Assist voucher.  Will you accept my app?

Landlord:  ‘Of course you can apply. I follow all laws.’

Prospective tenant: ‘Was my app approved?

Landlord:  ‘Why yes.  You met all my requirements and seem like a wonderful tenant!’

Prospective tenant: ‘Great!  Here is the Rent Assist app you must sign.’

Landlord:  ‘Sorry.  I do not accept Rent Assist, but I did accept you.’  and legally the owner could say ‘By the way, because you are accepted I expect you to take the place or forfeit the earnest money’

Prospective tenant: ‘WTF! This is an outrage.

Landlord:  ‘Sorry. This is the unintended consequences of  Ms, Dimitrijevic’s law.’

Result:   Confusion, a terrible experience  and possible negative financial consequences.

Instead of this bill, a true tenant advocate would require that owners disclose in advance of taking an app if they will accept Rent Assist or other programs.  That is what is fair and equitable, not some non discrimination code that will harm and confuse tenants.

Mar 07

Note: While Affordable accepts Rent Assist, I personally am opposed to mandating its acceptance.  Proposals like this reenforces the falsehood  that people who need Rent Assistance and not receiving it due to landlords not accepting the program.  This would make one believe that hundreds of eligible families are suffering  because no one would accept their voucher.  The truth is the waiting list is due to the County not providing enough vouchers to meet the demand.

This is more of the anti landlord posturing used by politicians to shift the blame for government actions and inaction onto our industry and make us look like the cause.

Here’s a legislative alert from AASEW Attorney Heiner Giese:

Here’s a big alert:

Milw Co. Supervisor Marina Dimitrijevic is proposing an ordinance to REQUIRE all landlords to accept Section 8 housing vouchers or any other kind of voucher for rental assistance. This would mean landlords would have to get a property registered under a section 8 program and submit their property for inspections. It would also require you to use one year leases — you could not rent month to month anymore because the Section 8 program mandates one year leases.

Further, it is so loosely drafted that a landlord could not evict a tenant who is behind on the rent if they get an Emergency Assistance check.

This may be coming up for a hearing before the County Economic Development Committee next Monday, March 12, starting at 9:00 AM.

We need people to appear and speak against this. Also, contact your County Supervisor..

The Milwaukee County Board of Supervisors does ordain as follows: 
 
Section 1. Chapter 107 of the Milwaukee County Code of General Ordinances is hereby amended as follows:
 
107.01. – Intent.
 
It is the intent of this chapter to render unlawful discrimination in housing and to enact this chapter pursuant to the authority granted to counties by s. 66.432(2) 66.1011, Wis. Stats. It is the declared policy of the county that all persons shall have an equal opportunity for housing regardless of sex, race, color, disability, religion, creed, national origin or ancestry, marital status of a person maintaining a household, lawful source of income, receipt of rental or housing assistance, age, sexual orientation, as defined in s. 111.32(13m), Wis. Stats., status as a victim of domestic abuse, sexual assault, or stalking, gender identity and gender expression, or status in a domestic partnership.
 
 
107.02. – Definitions.
 
(9) “Receipt of rental or housing assistance” means the receipt of any form of financial
contribution from a third party for the purposes of creating or keeping affordable housing for tenants, purchasers, or other potential housing recipients, including but not limited to, assistance provided pursuant to Title 42, United States Code, section 1437f (commonly known as the “Section 8” housing program), the HOME Partnership Program, the Community Development Block Grant program, or any other public or private rental assistance vouchers or programs.
 
 
Section 2.
The provisions of this Ordinance shall become effective upon passage and publication.

Atty Heiner Giese
1230  N. Prospect Ave.
Milwaukee, WI. 53202-3014
Tel. 414-276-7988 Fax: 414-276-8342


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