Jan 18

President elect Joe Biden proposes a $15 minimum wage claiming it will lift 1 million people out of poverty.

Clearly, it is not possible to pay current rents working full time at the current minimum wage. That needs to be addressed. I said similarly in New York Times interviews in 1991 and 2010:

“On $673 a month, how do you buy tennis shoes for the kids, clean shirts for school and still pay your rent?” Mr. Ballering said.
($673 was the W2, WI’s welfare program, cash payment in 2010)

https://www.nytimes.com/2010/02/19/us/19evict.html

I do not think increased minimum wage is the answer though. Such programs will cause rapid inflation, leaving those making minimum wages in a similar position in a few years as they are today. A better answer is something like FoodShare for Housing, which addresses the needs without rampant inflation.

The person with some skills who is making $15 dollars an hour today is not going to accept the person with no skills making the same amount, they will demand more. Now that the former $15 an hour person is making $25, the one-time $15 an hour person will expect $40—this causing the costs of goods and services to rapidly increase.

The other factor is it will result in far less lower-paid jobs, as companies will move work overseas and automate all that can be done by a machine. But you can’t replace the hamburger flipper … oh wait, they just did. Miso Robotics Flippy robot for $30,0000 replaces 3-4 employees, produces better quality and works 100,000 hours between major servicing. 24/7 staff for 30¢ an hour, no overtime, no worker comp, no paid holidays, no calling in sick because there was a Packer Game last night…

At many fast food places, when you talk into the drive-through speaker, you are speaking to someone that is in an off-site call center. When was the last time you were at Home Depot or or the large grocery chain store that the checkout person was not you? 😉

The winners of the increased minimum wage programs will be people who own hard assets when the increase becomes law. THe more you own at the beginning of an inflationary cycle, the more you win at the end.

The biggest winners will be those with a fixed rate mortgage. Let’s say you own a $100,000 duplex with a $75k loan. Today you have $25k and 25% equity. Ten years at 7% inflation, and it is worth just shy of $200k. Now you have $125k and 62% equity, plus your principal paydown. If inflation hits 12%, you reach those numbers in 6 years.

Crazy- This will never happen. But it did. From 1973 to 1981, we saw an average of 9.25% inflation, with three years over 12%. Mortgage interest rates in 1981 were north of 18%. Interest rates were over 8% for the entire period of 1973 to 1992.

If they pass a new minimum wage, the smart answer might be to buy as much highly leveraged real estate as you can manage, unless, of course, the inflation it causes and the trillions spent on COVID relief crash the entire economy…

Jun 26

Legislative committee blocks rule prohibiting landlords from charging late fees on rent

The ban on late fees was determined to be “arbitrary and capricious” yesterday morning by the Joint Committee for Review of Administrative Rules, on a 6-4 vote, and therefore unenforceable.

Important Note:
If your property or tenant is subject to the CARES act you cannot charge late fees until after July 24th, 2020.

Just because you can charge late fees, does not mean you should charge late fees, without exception.  Discretion should be given to tenants that are facing hardships.

Think of this like the speed limit. The sign says 70 and you usually do 75 to reach your goal a bit sooner. But trying to even do even close to the limit in a blizzard may well have the opposite effect. We could see an economic blizzard later this year.

The purpose of late fees is to encourage on-time payments by those who can pay, it is not to penalize those who are facing hardships.

My company did not charge late fees in April, even though the moratorium did not exist then, because anxiety was high for tenants.

Even though we can again charge fees, our company will waive late fees for tenants that can provide proof they have not received their unemployment checks or are waiting on WRAP, etc.

We have a list of resources for tenants facing hardship due to COVID or otherwise that you can share with your tenants if you wish.

May 12

The AASEW has done a lot of great things for the industry and sustainable rental housing.

One that benefited many owners was the change to Sheriff moves to eliminate the mover, which is a large portion of the costs.  

Our attorneys, working against their own personal interest, changed the law to allow LLCs to be represented by a member or agent, rather than requiring an attorney. This saves a lot of money as well as making the case less confrontational.

Here are the laws passed through the work of the AASEW in:

2018  https://bit.ly/3bryZ0Y
2016  https://bit.ly/2Lj7NXM
2014  https://bit.ly/3dCRRM1
2012  https://bit.ly/2zx3NQZ

It is important that we work together as an industry for the betterment of all.

Apr 17

In a funny/sad story, strippers are pushing as hard or harder for member benefits as our industry:

Strip clubs and lobbyists sue for stimulus dollars  – CNN

Apr 07

Rental housing advocates on all sides must work together, more so today than ever, and it was important back in the BC days. (Before COVID) 

We must work collaboratively with tenant advocates, whom some perceive to be on the “other” side. Advocates and rental owners are more like two sides of the same coin. You would not survive as a landlord without tenants, and tenants need the housing we provide.

There will be legislation and new rules impacting rental housing… SOON. Whether the changes will help both tenants and owners, or whether that legislation causes long term problems, will be determined by whether our voice is heard.

The Apartment Association of Southeastern WI has good people working on our behalf on these issues, Heiner Giese and Joe Murray, plus a dedicated Board and membership.

The Wisconsin Apartment Association has good people working on our behalf on these issues, Gary Goyke, and Chris Mokler, plus a dedicated Board and membership. 

All four lobbyists work collaboratively with each other and with the other stakeholders regardless of political affiliations. 

Legal Action and Community Advocates are working to find help for tenants so they can pay rent. Amazingly, their messages have been that tenants still must pay rent even though they cannot be evicted until at least May 27th.

These efforts to be heard and understood at the statehouse take time, energy, and, sadly, money.

You can do your part to help us help you by joining one or both groups. Not only are you supporting the industry that helps support you, but you will be in the “know” sooner than those who are not members of apartment associations.

I’ve been a member of the Apartment Association of Southeastern WI since 1989, and a board member for nearly all of those years. As of today, I am also a member of the Wisconsin Apartment Association. 

Links to join:

Apartment Association of Southeastern WI

Wisconsin Apartment Association:

https://www.waaonline.org/account/create-account.php

Don’t do it for me. Don’t do it for the associations. Do it for you.;-)

Aug 18

The Fall 2019 Apartment Association Landlord Tenant Law Boot Camp is October 26, 2019

Even though I know the law well, we’ve sent our staff. It is good for them to hear the rules from someone else. Plus if they learn one new thing, it more than pays the modest cost.

Wisconsin landlord tenant law has changed dramatically in 2012, 2014, 2016 and 2018 to Wisconsin’s Landlord Tenant Law with Act 143, Act 76, Act 176 and Act 317.

Tristan obviously knows the latest law, but that’s the easy part. He also is one of the most prolific landlord tenant attorneys in Southeastern WI. That gives him great insights into how the courts are ruling today and what the most recent “Gotcha’s” are.

At $189 for members, it is far cheaper than learning from your mistakes. Not only does it help prevent costly errors, you also will learn how to legally screen better, thereby reducing evictions, and other things that will result in profitability.

AASEW Landlord Boot Camp 2019
WHEN: Saturday, October 26, 2019
WHERE: Four Points Sheraton 5311 S. Howell Avenue, Milwaukee, Wisconsin, 53207 (Across from the airport)

Registration opens at 7:10 AM

The seminar runs from 8:30 to 5 PM with a 30 minute break for a complimentary lunch. There will be a one hour question and answer session afterwards, ending promptly at 6 pm. Many will find the Q&A invaluable, therefore you may wish to arrangements to stay until 6 pm.

Updated to include the latest law changes and court rulings!

INCLUDED: 100 plus page manual to help you put what you learn into practice.

More info and sign up at http://LandlordBootCamp2019.com

Jan 13

The Spring 2019 Apartment Association Landlord Tenant Law Boot Camp is February 9th, 2019. (Less than a month away.)

Even though I know the law well, we’ve sent our staff.  It is good for them to hear the rules from someone else.  Plus if they learn one new thing, it more than pays the modest cost.

Tristan knows the latest law, but that’s the easy part.  He also is one of the most prolific landlord tenant attorneys in Southeastern WI.  That gives him great insights into how the courts are ruling today and what the most recent “Gotcha’s” are.

At $179 for members, it is far cheaper than learning from your mistakes.  Not only does it help prevent costly errors, you also will learn how to screen better and other things that will result in profitability.

AASEW Landlord Boot Camp 2019

WHEN: Saturday, February 9, 2019

WHERE: Four Points Sheraton 5311 S. Howell Avenue, Milwaukee, Wisconsin, 53207 (Across from the airport)

Registration opens at 7:10 AM

The seminar runs from 8:30 to 5 PM with a 30 minute break for a complimentary lunch. There will be a one hour question and answer session afterwards, ending promptly at 6 pm. Many will find the Q&A invaluable, therefore you may wish to arrangements to stay until 6 pm.

Updated to include information from Wisconsin ACT 317!

INCLUDED: 100 plus page manual to help you put what you learn into practice.

 

More info and sign up at LandlordBootCamp2019.com

Jul 31

https://www.hud.gov/program_offices/healthy_homes/smokefree

This rule is helpful for private owners who wish to ban smoking, as well as offering a marketing opportunity, I guess, for owners that permit smoking.

I agree with HUD on this, the advantages of smoke-free housing outweigh any market advantage of allowing smoking.

https://archives.hud.gov/news/2016/pr16-184.cfm

HUD’s smoke-free rule will reduce damage and maintenance costs associated with smoking. According to the Centers for Disease Control and Prevention (CDC), HUD’s national smoke-free policy will save public housing agencies $153 million every year in repairs and preventable fires, including $94 million in secondhand smoke-related health care, $43 million in renovation of smoking-permitted units, and $16 million in smoking-related fire losses. It is estimated that smoking causes more than 100,000 fires each year nationwide, resulting in more than 500 deaths and nearly a half a billion dollars in direct property damage.

Jul 23

In essence, once a standard is included by reference into a law, does that standard becomes public domain. As we discussed with the NFPA and IFC fire codes incorporated by reference into the carbon monoxide detector code, it should.

Public.resource.org wins appeal on right to publish the law [pdf] (uscourts.gov)

Ever operated a tank barge and wondered what power source you would need for your cargo tank’s liquid overfill protection system to comply with the law? Probably not. But if you did, you might consider thumbing through the Code of Federal Regulations, where you would discover that one option is to hook up to an off-barge facility, provided that your system has “a 120-volt, 20-ampere explosion-proof plug that meets . . . NFPA 70, Articles 406.9 and 501-145.” 46 C.F.R. § 39.2009(a)(1)(iii)(B). Dig deeper and you would learn that NFPA 70 is not some obscure rule or regulation or agency guidance document but is instead another name for the “National Electrical Code,” a multi-chapter technical standard prepared by the National Fire Protection Association (the eponymous “NFPA”), detailing best practices for “electrical installations.” Complaint ¶ 66, American Society for Testing & Materials v. Public.Resource.Org, Inc. (ASTM), No. 1:13-cv-01215 (D.D.C. Aug. 6, 2013) (“ASTM Compl.”), Dkt. No. 1, Joint Appendix (J.A.) 86. Parts of NFPA 70 have been incorporated into the statutes or regulations of at least forty-seven states and, as we have just seen, the federal government. American Insurance Ass’n Amicus Br. 5.

A bunch of good comments:
https://news.ycombinator.com/item?id=17579742

And a good summary of the issue:
http://www.dailyreportingsuite.com/ip/news/IPLD20180718

Underlying dispute. The district court had addressed motions and cross-motions for summary judgment brought in two separate but related cases brought by SDOs against Public Resource. In one case, the American Society for Testing and Materials (“ASTM”), National Fire Protection Association, Inc. (“NFPA”), and American Society of Heating, Refrigerating, and Air-Conditioning Engineers (“ASHRAE”) (collectively “ASTM Plaintiffs”), sued Public Resource for both copyright and trademark infringement, based on Public Resource’s copying and dissemination of 257 standards developed by the ASTM plaintiffs that have been incorporated by reference into federal law. Public Resource admitted that it purchased hard copies of each standard, scanned them into PDFs, added a cover sheet, and posted them online. Public Resource also retyped the plaintiffs’ standards and posted them online. The summary judgment motion related to nine of the allegedly infringed standards.

https://www.theregister.co.uk/2018/07/17/appeals_court_copyright_fair_use/

Y’know… Publishing tech specs may be fair use, says appeals court
Expect this one to be argued all the way to the Supremes
In a victory for those supporting open access to technical specifications, the US Court of Appeals for the District of Columbia Circuit on Tuesday vacated injunctions [PDF] that prohibited Public.Resource.Org (PRO) from publishing copyrighted technical standards online.

 

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.

 

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