Seattle's Latest Insanity: ban criminal background checks

53 Replies

Originally posted by @Ed S. :

You are ok that your neighbor has criminal background (drugs, attempted murder, attempted rape)??????

Context:

If those neighbors have money and decent credit, they can simply buy it. We do not do violent crime background checks, non-violent financial crimes are all we really care about. I've done plenty of mortgages for violent felons and ex cons, and met some amazing entrepreneurs who applied their "street knowledge" ability to hustle to something lawful like plumbing or car repair. It's actually a selling point that we don't run violent crime background checks. 

"The solution to all your ex-con housing problems is to buy a home in the nicest neighborhood you can afford!"

Rape, murder, drugs, etc, do not show up on credit reports. Back child support and student loans, however, do. And there is a specific extra-judicial blacklist for those that we feel have wronged our industry. Kind of like the Mafia, we really do not care what you did as long as we (or a related industry) weren't the victim.

So your owner occupant neighbor that put 3% or 5% down can be a convicted murderer all they want, but God Forbid they are behind on child support or lied on a mortgage loan application. 

Originally posted by @Tyler Shigenaga:

SF paved the way for many of these policies.  I was actually the beneficiary of a landlord that was trying to raise my rent 35% above our current rate once one of the tenants on the lease moved out.  The housing board sided with me and we actually had our rent reduced because she found that the landlord was overcharging us rent for 2 years running.  She ended up owing me $7.6k (which is going into my RE investment fund) and she is allowed to increase our rent on an annual basis at the rate of inflation which the rental board establishes.  Do I think its fair to the landlord, not really because if we moved out she would be able to get that 35% increase in rent and we would have to find something else at close to $2k/room.  

It's hard to really pick a side bc without rent control in SF, it would be musical chairs of housing amongst renters bc the landlords would be constantly increasing rents to the point that it would force everyone out.  Finding an equilibrium would be predicated on location and proximity to the cities amenities/industry.  At the same time, I agree that we should be paying more than what we are due to the original lease we signed 5 years ago.  SF is just a really bad rental market but it would be a fascinating economic study of free market dynamics in housing.

*Side note, NY has the same issue just due to the geographic nature of the bay/water where LA doesn't have this problem because they are in a giant valley and they can build all the way out to the inland empire.  With that comes terrible transportation . . .

 No you can blame SF.  Because without rental control the clearing price of a good or service would come to an equilibrium.  You would have additional building ie capacity and you would have people who decide they need to move to cheaper places.  Sooner or later the price would come down. 

When you reduce supply because there aren't returns, landlords will not A) reinvest in their property and B) will either not rent it at all or will increase the rent knowing they are unable to adjust the rent.

Its bizarre people think these policies work in violation of basic economics.  

I'm curious about screening for applicants who are registered sexual offenders. Is that still possible? In my area such applicants cannot reside within 1000 feet of a school or daycare.
Gail

I'd be curious to know if the proposed ordinance simply prevents the use of a criminal background check as a screening criterion? Is there anything in it to prevent the background check being done anyway?

Since such matters are usually public record, what if the leasing agent comes by that information through public channels?

@Bart H.

No question that local policies have skewed this market beyond reasonable economic function.  The city has certainly made it very difficult for new development of housing stock and there are some investors now that will buy a house, and leave it vacant rather than rent it just to make the appreciation (rather than CF + appreciation).  They find it easier to avoid dealing with tenants and rental laws in the city.  Of course being the city of SF, they are looking for ways to tax investors who are leaving these units vacant.  

And yes, I know of multiple friends who live in apartments here in the city  that have not been renovated for well over 25 years and they still command $2k/room.  The city's solution seems to be putting in additional regulations and laws is the solution that will fix all wrongs.

@Patrick Britton I'll answer with a quick reply

If you read that some city passes a law saying "criminal background checks are illegal", and were given $100 to bet if the city in question was a left or right leaning city, what would you guess?

@Cody L. I had to laugh when I read your comment. It is so right on. Yet, people defend investing there. It is very hard for a prosecutor to get a conviction, anybody who gets convicted probably has a lesser charge than what their actual crime was so that the prosecutor could actually get a conviction, anybody who got convicted has most likely a long history of doing bad things that they were let off for, and they probably had even more bad things they had done that they never got caught for. If someone actually has a conviction, they have been at it for a long time and aren't likely to change their behavior. (I volunteered helping  troubled youth and I saw it first hand.) *Not* doing a criminal background check is madness. 

Originally posted by @Account Closed :

@Cody L. I had to laugh when I read your comment. It is so right on. Yet, people defend investing there. It is very hard for a prosecutor to get a conviction, anybody who gets convicted probably has a lesser charge than what their actual crime was so that the prosecutor could actually get a conviction, anybody who got convicted has most likely a long history of doing bad things that they were let off for, and they probably had even more bad things they had done that they never got caught for. If someone actually has a conviction, they have been at it for a long time and aren't likely to change their behavior. (I volunteered helping  troubled youth and I saw it first hand.) *Not* doing a criminal background check is madness. 

 The worst part about it is they will be the same goobers who will hold the landlord legally liable for drugs or violence in their rentals.

Originally posted by @M.C. Nachtigal :

I just saw the latest proposed insanity, set to be voted on by the Seattle City Council next Monday.  I would be surprised if it does not pass.   This one would ban all criminal background checks by landlords of prospective tenants.  So within a year we have the law about deposit limits, requiring landlords to allow tenants to pay last month/deposit in 6 installments, then the First in Time law, requiring landlords to take the first applicant to meets their previously-specified qualifications, a proposal requiring landlords to justify any rent increases with documentation of their costs, and now this preventing landlords from checking or using criminal background as a selection criteria.  For me personally, the obvious answer is that I need to get out of this business.  However, since I've barely begun, that's not going to happen immediately.  Some say that simply by raising rent and/or credit score requirements, that will weed out a fair amount of the criminal risk.  How would you feel about this?  Do any other cities have restrictions like this?

Wow! That sounds terrible. In Chicago landlords have the option of a security deposit or a non-refundable move-in fee (up to half a months rent) so you have options for that.

As for the criminal background check. I will be curious to see how that plays out. Raising rents may not be a great option depending on where your property is located but you still get to do a credit check. I am going to guess that most criminals (maybe not white collar) do not have great credit.

Landlords will protect themselves by making income and credit score requirements unreasonably high. People with high incomes and and great credit are very unlikely to have a criminal background. This will push out the good tenants with average credentials. Thus creating a bigger gap between the haves and have nots. Seattle will soon look like LA. No middle class. Here in LA we have rich neighborhoods and poor neighborhoods, not much in between. Liberal policies exacerbate the very problems they are meant to alleviate.

It's funny how the blue states shout "income inequality" as if it's a battle cry. But they are the cities with the most inequality. Seattle, LA, New York, San Francisco etc all have housing that is out of reach to the average person. But a person making 50K a year can buy a home in Texas, Ohio, Florida Michigan etc.....when will they realize it's the policies that are creating it? Not some outside force.

@Jonathan Hulen , Yeah I hear a lot of people always talking about how CA is the 6th biggest economy. But if you look at Census data and actually adjust for cost of living...California has the highest poverty rate in the country. A lot of that wealth isn't 'trickling down' to the average person. Los Angeles.

Link:

http://www.politifact.com/california/statements/20...

Lot's of people in CA mention how there is a lot of poverty in 'red states' ...but like you mentioned people making average wages can actually afford to live there. 

For conversations I've had of people that live in CA, many are pretty uninformed about how well the economy is doing in many parts of the country like in Texas ,etc. Also Texas is a lot less conservative and more diverse than a lot of people in CA acknowledge. For example Houston is the 4th largest city in America and it is now the most diverse city in America and elected the first openly gay mayor of a major city.

The pension issue in CA is a big thing too .

One recent article on that:

http://www.mercurynews.com/2017/07/30/steve-westly...

I am a CA native and there are many great things about the state, but I am pretty worried about how things are going in CA. Los Angeles has seen rising violent crime and out of control homelessness the past several years too.

@M.C. Nachtigal Whew!! It isn't as bad as I thought it would be. . . .

Seattle rental applicants’ criminal histories virtually off-limits under new law

"Rental applicants will be able to file complaints with the office, which will investigate. For a first-time violation, the maximum penalty will be $11,000; for a second violation in five years, $27,500; and for a third violation in seven years, $55,000."  

Heh,heh,heh ;-)  They've gone mad!

Originally posted by @Joseph M. :

@Jonathan Hulen , Yeah I hear a lot of people always talking about how CA is the 6th biggest economy. But if you look at Census data and actually adjust for cost of living...California has the highest poverty rate in the country. A lot of that wealth isn't 'trickling down' to the average person. Los Angeles.

Link:

http://www.politifact.com/california/statements/20...

Lot's of people in CA mention how there is a lot of poverty in 'red states' ...but like you mentioned people making average wages can actually afford to live there. 

For conversations I've had of people that live in CA, many are pretty uninformed about how well the economy is doing in many parts of the country like in Texas ,etc. Also Texas is a lot less conservative and more diverse than a lot of people in CA acknowledge. For example Houston is the 4th largest city in America and it is now the most diverse city in America and elected the first openly gay mayor of a major city.

The pension issue in CA is a big thing too .

One recent article on that:

http://www.mercurynews.com/2017/07/30/steve-westly...

I am a CA native and there are many great things about the state, but I am pretty worried about how things are going in CA. Los Angeles has seen rising violent crime and out of control homelessness the past several years too.

Houston is super diverse, but to be fair, that diversity is pretty segregated.  So yeah, we (Houston) have a nice mix of people as a whole, but they're all located in "black" areas, "white" areas, "Asian" areas, "Hispanic" areas, etc.

@Chris Mason

Interesting take I hadn't really considered.  A different take on "follow the money"

Big-time against the ruling and am glad I'm not in Seattle.  I don't really understand the area after living here all my life.  We want to encourage homelessness, drug use, illegal immigration.  All are welcome, park your ragged RV in front of my house, shoot up in a monitored clinic, pitch a tent wherever, hell, start a drug cartel, its all ok.  But then we complain about crime and cut police and not let them enforce the laws.  We want to build trains when automated driving technology is ramping up and will be common before the end of the decade. Scream we need more affordable housing, but make laws and delay permits that limit entrepreneurship that could bring those needed units online........

Ken Min , the landlords are just trying to run a legal business but seem to be getting treated like criminals themselves .

L.A just started a "ban the box" ordinance which reminds me of this ,

"Los Angeles City begins enforcement on July 1, 2017 of its Fair Chance Initiative for Hiring Ordinance that prohibits employers from seeking criminal background information prior to offering a job to applicants. "

http://www.californiaemploymentlawreport.com/2017/06/los-angeles-city-begins-ban-box-enforcement-july-1-2017/

No trying to make this a political thread but have to say that if rental laws you dont like are the worst the "liberals" can throw at you it sure beats burning crosses and nazi salutes in white robes which is what the other side seems to be more about.

Originally posted by @David Dachtera :

I'd be curious to know if the proposed ordinance simply prevents the use of a criminal background check as a screening criterion? Is there anything in it to prevent the background check being done anyway?

Since such matters are usually public record, what if the leasing agent comes by that information through public channels?

 Good question David as I haven't seen it mention actually running the check, just that you cannot ask about the applicant's criminal history or reference criminal history as part of your criteria.

I think this is the full ordinance so I will try to look through it:

http://seattle.legistar.com/LegislationDetail.aspx...

The Seattle City Council has had a very tough attitude towards landlords. They also have an ordinance requiring Landlords to provide renter's with voter registration material but the same is not required of other real-estate transactions. They have also cracked down on AirBNB options because it displaces rental properties.

https://www.seattlemet.com/articles/2017/6/19/land...

I'm a new investor out of Seattle and I am specifically avoiding Seattle as a market because of city leadership. They seem to have forgotten that the person who should have the most say in who can do what with their property, should probably be the owner. Those that predict a worsening income/inequality gap because of these policies are right!

@Ed S. Or they were jailed for fraud. 

I had a tenant whose background check came up OK in the state in which he wanted to live.  After the move in and subsequent  violence in which the cops were repeatedly called we found out that he had an extensive rap sheet from a neighboring state.  IT WAS AWESOME. 

If anyone thinks that excluding a criminal history in a background check is a good idea then you are welcome to deal with this clown. I doubt you'd have enough kool-aid to gag the experience down.