We had a conversation with a guy today and it went something like this:
"Hey I saw you hauling some lumber the other day. Whatcha building?"
"We bought a rental house and I was fixing a safety hazard." (Concrete step at entry. 6" tread, 9" risers)
"Ah. I don't do repairs at my rentals."
"Really?"
"Yeah, I rent to druggies. Whatever is there is what they live with. They don't complain."
I just can't wrap my head around it. Renting to druggies is his plan. And he's proud of it.
Being a "slum lord" has very little to do with cash flow. The lowest class properties generally have the highest cash flow in the industry. The reason they do not waste money on upkeep is because the tenants generally destroy everything nice. Minimum repair to meet code keeps the money flowing and the class of tenants have little grounds to complain... or choice..
I will take your your challenge and say this from a high horse.
First, I think it is a good thing that your buy houses and fix them up. Call it gentrification or good investing, any addition to decent housing is a net positive.
But, your logic regarding substandard housing is better than no housing is flawed. Lets use a real life example
The cladding used in the low income apartment towers in London was 300,000 pounds less than the fire resistant cladding. There are at least 111 buildings with that cladding, so a crude estimate of money saved is 3.3 million pounds or 4.2 million US. Now here is where I get nice. I am going to grant you that 3.3 million pounds will build 50 low flats. It wont, London is the 2nd highest construction costs in the world, but I am going to grant.
So cheap cladding saved enough money to build 50 flats
In exchange, more than 100 people lost their lives (80 confirmed and still searching) and 156 homes and flats were lost and 250+ people are homeless.
Explain how that tradeoff works? This is a real life example.
Don't like this one. Do the same math with the warehouse fire in Oakland and letting people live in non-residential spaces. It will turn out the same. Substandard housing is not better than no housing.
Your whole argument is based on substandard housing being inferior to no housing, yet you only provide evidence supporting your position. Come on man. You're better than that.
Here's another real life example (terribly tragic I might add. I was shocked/appalled to hear of this when it happened). Let's think about the homeless man, outside of Paradise Valley Mall in Phx AZ who was chained to a metal bench and then lit on fire by teenagers.
His death was truly tragic and the kids that did it deserve a special kind of punishment. But the point I want to make from this graphic story is that would this have happened if the homeless man had been living in a home? Even if that home had holes in the floor/exposed wiring/no heat/etc.??
I don't think so. How would you explain this trade off? Or any of the other trades that have to be made when someone is homeless and is the victim of brutal violence or the biting cold and freezing wind?
If you're going to condemn Cody for what he is saying, at least present a fair and balanced post.
Of course I presented 1 side....I am arguing my point not his. I don't think you understand how debate works. My argument is simple, less people die from homelessness than would die in tragedies that would be prevented by code. It is unprovable, because you can't run a controlled experiment, but I wanted to answer your post.
I would point to the recent experience in Utah. They specifically provided the opportunity for housing to everyone and recently claimed to hit 100%. Which is great. But if you look at the numbers, you see a bunch of people did not take the housing. Because homelessness is more about mental disease and drug use than money. So you are going to get homeless deaths regardless, I see no need to lower codes to make it worse
The safest, most sustainable place for a homeless person to sleep is inside a locked vehicle. Even in the dead of winter, with a decent sleeping bag, out of the precipitation and wind, a person can sleep quite well in a non-running vehicle.
Unfortunately, instead of trying to create enforceable guidelines for this, city councils have passed municipal codes completely outlawing this practice.
DL
My argument is simple, less people die from homelessness than would die in tragedies that would be prevented by code. It is unprovable, because you can't run a controlled experiment, but I wanted to answer your post.
I don't mean to be contrary, but this is wildly inaccurate. Homeless people die constantly from exposure. Summer and winter. The alcohol and drug use causes them to go to sleep without using the clothing/blankets/materials that they keep with them for that purpose.
I personally have responded to thousands of "I think he might be dead" calls. Usually they aren't. But many times, they are. And you are right, I don't know that "unattended deaths" are tracked by any government agency.
My experience was in SoCal, but I'm sure that there are some NYPD/NYFD BP'ers here who can give an estimate on the number of homeless that die from exposure on any given night in NYC during January. I would venture to say that more homeless folks die from exposure in NYC in one month than die in all "sub standard housing" accidents/fires/incidents in an entire year in the entire USA.
DL
Thanks @Jeffrey Hotz! I was just going to do that!
This is a really interesting thread (at least most of it).
@Levi T. articulated the market challenges very well. Much of it depends on the market you're in, but let's assume the local economy is growing equal to the population, and wage rates are equal inflation. If you buy crappy places and turn them around, the former tenants will be off looking for some place else they can afford. A growing local market should be able to support a growing percentage of "nicer" places, and vice versa.
Anyone who has a problem renting substandard housing to low income people should make some effort to meet some of those prospective tenants. There are thousands of people in big cities that are choosing to live in tents under overpasses, or in the urban jungle on the river banks. (Many are also forced into it, true.) If we could provide all of them a place to live, I'm sure it wouldn't be nice. I noticed in @Ron Flatt's comment that his elderly relative visits the tenants every month. Hopefully her relationship with them is mutually beneficial. I think the relationship is important.
Personally, I couldn't leave holes in the floor, non-working heat, or plumbing leaks in a house regardless of the rent. If your the same way follow what @Justin Fox says and "do something or get out of the way". If you can provide a better home at the same price, get to it. Your business will grow while the slumier slum lord's business will shrink.
I would grant that right now there are more homeless deaths than death due to failures of housing by code in the US for sure. Although small point, I am not sure the death of every homeless person is a result of them being homeless. For instance if they OD, they could have done that in a house also. But to be sure, it is the direct or contributing cause to a lot of deaths.
My assertion is that if the STOPPED enforcing codes, and we put people in some kind of housing, for example, the Favelas in Brazil, that the corresponding deaths would be actually higher. Why do I think this, because every city in the US was originally founded without building codes. And in every instance, they instituted those codes because they found it was needed. This is not just true in the US, if you look across the world most all places have some form of building and safety codes. So I would assert that the experiment has been run, and the benefits of codes outweigh the cons.
@Sylvia B., thanks for starting this thread because it's a discussion that needs to be had. I've been called a slumlord as well because I own property in one of the poorest areas of Chattanooga. However, I want to make the case being a slumlord is not about the location of your property, but it's about your actions and the living conditions you provide for your tenants. I've taken excellent advice on Section 8 and low income tenants from great landlords like @Patti Robertson and I'm very proud of living conditions I provide. My properties are located in low, medium, and high income areas and I provide excellent conditions in all of them. Regardless of the property location, the question is never whether or not something will be repaired...it's only about design and finishes (to be consistent with the price point and customer base).
All that being said, I'm happy to be called a slumlord if the label continues to scare away people from the highest cash flowing areas where I like to invest. I'm proud to be a Section 8 landlord because I'm a good landlord and low income tenants (especially) need good landlords. See the photos below for before and after photos of my Section 8 duplex:
I will take your your challenge and say this from a high horse.
First, I think it is a good thing that your buy houses and fix them up. Call it gentrification or good investing, any addition to decent housing is a net positive.
But, your logic regarding substandard housing is better than no housing is flawed. Lets use a real life example
The cladding used in the low income apartment towers in London was 300,000 pounds less than the fire resistant cladding. There are at least 111 buildings with that cladding, so a crude estimate of money saved is 3.3 million pounds or 4.2 million US. Now here is where I get nice. I am going to grant you that 3.3 million pounds will build 50 low flats. It wont, London is the 2nd highest construction costs in the world, but I am going to grant.
So cheap cladding saved enough money to build 50 flats
In exchange, more than 100 people lost their lives (80 confirmed and still searching) and 156 homes and flats were lost and 250+ people are homeless.
Explain how that tradeoff works? This is a real life example.
Don't like this one. Do the same math with the warehouse fire in Oakland and letting people live in non-residential spaces. It will turn out the same. Substandard housing is not better than no housing.
Your whole argument is based on substandard housing being inferior to no housing, yet you only provide evidence supporting your position. Come on man. You're better than that.
Here's another real life example (terribly tragic I might add. I was shocked/appalled to hear of this when it happened). Let's think about the homeless man, outside of Paradise Valley Mall in Phx AZ who was chained to a metal bench and then lit on fire by teenagers.
His death was truly tragic and the kids that did it deserve a special kind of punishment. But the point I want to make from this graphic story is that would this have happened if the homeless man had been living in a home? Even if that home had holes in the floor/exposed wiring/no heat/etc.??
I don't think so. How would you explain this trade off? Or any of the other trades that have to be made when someone is homeless and is the victim of brutal violence or the biting cold and freezing wind?
If you're going to condemn Cody for what he is saying, at least present a fair and balanced post.
Of course I presented 1 side....I am arguing my point not his. I don't think you understand how debate works. My argument is simple, less people die from homelessness than would die in tragedies that would be prevented by code. It is unprovable, because you can't run a controlled experiment, but I wanted to answer your post.
I would point to the recent experience in Utah. They specifically provided the opportunity for housing to everyone and recently claimed to hit 100%. Which is great. But if you look at the numbers, you see a bunch of people did not take the housing. Because homelessness is more about mental disease and drug use than money. So you are going to get homeless deaths regardless, I see no need to lower codes to make it worse
Maybe I was just tagged because I was on a reply to a reply but I don't disagree with anything you said.
Wait...an internet discussion that ends in agreement? Do we have to register with the Guinness Book of World Records? I feel like this may be one of the signs of a coming apocalypse.
:-) I am glad we found common ground.
@Sylvia B. Oh, you'll be surprised at what some "investors" are willing to do to make a quick buck. Any known illegal activity by a landlord can come back to haunt them should any problems with the property and/or the tenants come up in the future. The issue completely depends on each investor's level of risk.
I have been GOP my entire life, but there is a real need for building codes, because without them some people will race to the bottom. So,yes, it is for us to judge, there are minimum standards and they should be enforced
Being "GOP" has nothing to do with this. If you truly believed in free markets, you would understand that the government is rarely (if ever) the most efficient mode of accomplishing anything. Building codes are not needed, safe housing is needed. Codes don't stop true slum lords (obviously), it is simply another intrusion into private property rights. Something the "GOP" should probably oppose.
I reference the Oakland fire as building code are needed to help ensure safe housing.
Having said this it seems strange that I can keep my old small windows that met code when built (but no longer meet egress code) but if I replace them I need to meet the new egress code requiring larger windows. So my choice is old, poor, crappy, energy inefficient windows or larger (supposedly safer for egress) energy efficient new windows that require new framing, drywall, paint, etc. Clearly new energy efficient windows of the same size would be an upgrade and no more dangerous than the existing windows. I was tempted to keep the old windows in the bedrooms and replace all the other windows.
If anyone thinks that politics doesn't play a massive role in these proceedings, then you are sorely misinformed. The people with the most say at these "International Code Hearings" are usually vendors who have a vested interest in seeing new, more restrictive codes put in place. Hell, i'm a lobbyist and i'm paid to ensure most of these things don't go through. Where there is a chance for regulators to generate revenue, there will always be pressure and codes are no different.
I'm not a slum lord, but If I made my houses "up to code" it would cost me thousands of dollars that I would never recuperate.
This is not an open, or even democratic, process. With fire codes, the fire department stacks the committee with their people and jambs things through without the slightest deference to building owners. If there is the slightest risk of life-safety issues for the FD, they will fight you saying they are saving lives. The same goes for building codes.
It's true, there are a lot of smart people that decide these rules, but I have yet to find anyone proposing these changes that has actually owned a rental property.
I agree with a lot of this. I specifically know of a local city that prohibits using 14 gauge electrical for anything, even a single range hood or 60 watt light fixture; they are the only municipality around like that. Coincidentally, one of the big electrical suppliers helped rewrite that code a few years ago. Also coincidentally, 12-3 is about 70% more expensive. So there's at least one example.
I suspect someone replace 15a circuit when th 20a circuit, over loaded the 14g wiring not rated up to 20a and not triggering the incorrect 20a circuit breaker resulting in a fire.
To ensure no one could break code by putting 20a circuit on wiring that could not handle 20a they made rule that would make is so that it could not occur. If my theory is correct someone broke code resulting in this. Such a person who would break such a code (use wrong size circuit breaker) is not more likely to use 12g wiring because the code calls for it rather than the cheaper 14g.
So I suspect the intent was good but the thinking behind the intent was flawed.
By the way when I was younger working to restore houses for sale it was not irregular to see pennies used instead of fuses in the old panels. I think education could help rather than codes in some cases. Again assuming my theory was correct it is possible the person putting 20a switch were there had been a 15a switch was trying to address it constantly tripping because circuit was overloaded and unaware what he was doing was dangerous (or even that different gauge wiring is used in a house).
. . . "I just saw on my news feed that a "we buy ugly houses" franchisee admitted to running a Ponzi scheme" . . . WOW!!! AMAZING! Can't imagine how that could work.
I will take your your challenge and say this from a high horse.
First, I think it is a good thing that your buy houses and fix them up. Call it gentrification or good investing, any addition to decent housing is a net positive.
But, your logic regarding substandard housing is better than no housing is flawed. Lets use a real life example
The cladding used in the low income apartment towers in London was 300,000 pounds less than the fire resistant cladding. There are at least 111 buildings with that cladding, so a crude estimate of money saved is 3.3 million pounds or 4.2 million US. Now here is where I get nice. I am going to grant you that 3.3 million pounds will build 50 low flats. It wont, London is the 2nd highest construction costs in the world, but I am going to grant.
So cheap cladding saved enough money to build 50 flats
In exchange, more than 100 people lost their lives (80 confirmed and still searching) and 156 homes and flats were lost and 250+ people are homeless.
Explain how that tradeoff works? This is a real life example.
Don't like this one. Do the same math with the warehouse fire in Oakland and letting people live in non-residential spaces. It will turn out the same. Substandard housing is not better than no housing.
The rents were 2000 pound (almost $2600) for 2 BR units. Is that low income apartments? Serious question. Maybe it is in London. I had not heard it described elsewhere as low income apartments.
@Heather O., yes the stainless steel appliances are after. They were purchased brand new from Sears scratch and dent at about 40% off retail price. We used a gel stain on the kitchen cabinets
If anyone thinks that politics doesn't play a massive role in these proceedings, then you are sorely misinformed. The people with the most say at these "International Code Hearings" are usually vendors who have a vested interest in seeing new, more restrictive codes put in place. Hell, i'm a lobbyist and i'm paid to ensure most of these things don't go through. Where there is a chance for regulators to generate revenue, there will always be pressure and codes are no different.
I'm not a slum lord, but If I made my houses "up to code" it would cost me thousands of dollars that I would never recuperate.
This is not an open, or even democratic, process. With fire codes, the fire department stacks the committee with their people and jambs things through without the slightest deference to building owners. If there is the slightest risk of life-safety issues for the FD, they will fight you saying they are saving lives. The same goes for building codes.
It's true, there are a lot of smart people that decide these rules, but I have yet to find anyone proposing these changes that has actually owned a rental property.
I agree with a lot of this. I specifically know of a local city that prohibits using 14 gauge electrical for anything, even a single range hood or 60 watt light fixture; they are the only municipality around like that. Coincidentally, one of the big electrical suppliers helped rewrite that code a few years ago. Also coincidentally, 12-3 is about 70% more expensive. So there's at least one example.
I suspect someone replace 15a circuit when th 20a circuit, over loaded the 14g wiring not rated up to 20a and not triggering the incorrect 20a circuit breaker resulting in a fire.
To ensure no one could break code by putting 20a circuit on wiring that could not handle 20a they made rule that would make is so that it could not occur. If my theory is correct someone broke code resulting in this. Such a person who would break such a code (use wrong size circuit breaker) is not more likely to use 12g wiring because the code calls for it rather than the cheaper 14g.
So I suspect the intent was good but the thinking behind the intent was flawed.
By the way when I was younger working to restore houses for sale it was not irregular to see pennies used instead of fuses in the old panels. I think education could help rather than codes in some cases. Again assuming my theory was correct it is possible the person putting 20a switch were there had been a 15a switch was trying to address it constantly tripping because circuit was overloaded and unaware what he was doing was dangerous (or even that different gauge wiring is used in a house).
I'll grant that's possibly the reason, but yes their thinking was definitely flawed logic; what's to stop someone from putting in a 30 amp breaker? Then should they go to only 10-3? 馃槀
The main problem with any kind of regulation is that enforcers either aren't given the power of judgement and common sense, or the enforcers want to take the easy/lazy way out and abrogate their responsibility when they are permitted to make judgement calls.
I don't want to get political but everything in this country these days lacks common sense, reasonableness and compromise. Look at my own town. The city has to go through almost 2 months of BS to make some stupid, lazy drug hoarders on one of our rental streets cut the freaking grass. Because the state is worried that if you make someone cut the grass it's a slippery slope to requiring rose gardens and peonies in the front yard.
Actually yes, London is "San Francisco" level expensive, actually worse. The tenets were almost exclusively low income retired or immigrants . They call it "social housing" in the U.K.
https://qz.com/1007903/the-catastrophic-consequenc...
Affordability is relative. I was just in a webinar where they were offering investment in a new modular apartment they are building in SF. 250 sqft for $2500 a month. They had to get an exemption to building codes because the square footage is so small. They sell it as the solution to affordable housing. Of course I noticed they are selling at $10 a sqft as opposed to the neighborhood average of $7.60. But apparently the tenets are going to be bad at math and look only at the monthly cost. They may be right because city hall is all for it and they didn't notice it would actually be less affordable per sqft.
Shrug
I think it's a well known fact that you can make a lot of money off renting to the lowest rung of the rental ladder, You don't have to fix things since these people have nowhere else to go. I think this is true in a lot of other situations too, such as payday loans, subprime loans etc.
If anyone thinks that politics doesn't play a massive role in these proceedings, then you are sorely misinformed. The people with the most say at these "International Code Hearings" are usually vendors who have a vested interest in seeing new, more restrictive codes put in place. Hell, i'm a lobbyist and i'm paid to ensure most of these things don't go through. Where there is a chance for regulators to generate revenue, there will always be pressure and codes are no different.
I'm not a slum lord, but If I made my houses "up to code" it would cost me thousands of dollars that I would never recuperate.
This is not an open, or even democratic, process. With fire codes, the fire department stacks the committee with their people and jambs things through without the slightest deference to building owners. If there is the slightest risk of life-safety issues for the FD, they will fight you saying they are saving lives. The same goes for building codes.
It's true, there are a lot of smart people that decide these rules, but I have yet to find anyone proposing these changes that has actually owned a rental property.
I agree with a lot of this. I specifically know of a local city that prohibits using 14 gauge electrical for anything, even a single range hood or 60 watt light fixture; they are the only municipality around like that. Coincidentally, one of the big electrical suppliers helped rewrite that code a few years ago. Also coincidentally, 12-3 is about 70% more expensive. So there's at least one example.
I suspect someone replace 15a circuit when th 20a circuit, over loaded the 14g wiring not rated up to 20a and not triggering the incorrect 20a circuit breaker resulting in a fire.
To ensure no one could break code by putting 20a circuit on wiring that could not handle 20a they made rule that would make is so that it could not occur. If my theory is correct someone broke code resulting in this. Such a person who would break such a code (use wrong size circuit breaker) is not more likely to use 12g wiring because the code calls for it rather than the cheaper 14g.
So I suspect the intent was good but the thinking behind the intent was flawed.
By the way when I was younger working to restore houses for sale it was not irregular to see pennies used instead of fuses in the old panels. I think education could help rather than codes in some cases. Again assuming my theory was correct it is possible the person putting 20a switch were there had been a 15a switch was trying to address it constantly tripping because circuit was overloaded and unaware what he was doing was dangerous (or even that different gauge wiring is used in a house).
I'll grant that's possibly the reason, but yes their thinking was definitely flawed logic; what's to stop someone from putting in a 30 amp breaker? Then should they go to only 10-3? 馃槀
The main problem with any kind of regulation is that enforcers either aren't given the power of judgement and common sense, or the enforcers want to take the easy/lazy way out and abrogate their responsibility when they are permitted to make judgement calls.
I don't want to get political but everything in this country these days lacks common sense, reasonableness and compromise. Look at my own town. The city has to go through almost 2 months of BS to make some stupid, lazy drug hoarders on one of our rental streets cut the freaking grass. Because the state is worried that if you make someone cut the grass it's a slippery slope to requiring rose gardens and peonies in the front yard.
I believe we are in agreement on likely good intentions but with some flawed logic. I suspect education on the dangers of changing things related to electrical would have been more beneficial.
@Heather O., yes the stainless steel appliances are after. They were purchased brand new from Sears scratch and dent at about 40% off retail price. We used a gel stain on the kitchen cabinets "
SUPER!! WELL DONE!! Impressive! Love the open concept, quality, and style!
Seriously? Why on earth would anyone complain about improving conditions in a rough area? That makes zero sense.
Because costs go up, no way around it unless the person doing the upgrades and improving is a charity. Mary is staying in a property paying $500 a month (Which is what she can afford). The landlord has to do $600 worth of improvements (Fix the 3 front steps going into the house, replace a window that was old and broke when hail hit it, scrape and paint some exposed wood surfaces), that cost has to go somewhere. If the landlord was already at paper thin margins it is going to get passed on as a rent increase. So for that very modest $600 in repairs it equates to a $50 a month rent increase. So now Mary gets told rent is now going to be $550 a month. People get up in arms that she is being pushed out of her home and the lack of affordable housing for her.
Now I place no opinion on the correct thing to do, just answering the "why would anyone complain about improving conditions" question.
Got it @Mike Cumbie.
Inflation is going to force you to raise rents at least a little every few years anyway. I'm sure this hurts those on fixed incomes the most as their income has incrementally less spending power.
I see your point though, upkeep and improvements aren't free. You have to keep up with the times and, like it or not, so does the tenant.
I have been GOP my entire life, but there is a real need for building codes, because without them some people will race to the bottom. So,yes, it is for us to judge, there are minimum standards and they should be enforced
Being "GOP" has nothing to do with this. If you truly believed in free markets, you would understand that the government is rarely (if ever) the most efficient mode of accomplishing anything. Building codes are not needed, safe housing is needed. Codes don't stop true slum lords (obviously), it is simply another intrusion into private property rights. Something the "GOP" should probably oppose.
I reference the Oakland fire as building code are needed to help ensure safe housing.
Having said this it seems strange that I can keep my old small windows that met code when built (but no longer meet egress code) but if I replace them I need to meet the new egress code requiring larger windows. So my choice is old, poor, crappy, energy inefficient windows or larger (supposedly safer for egress) energy efficient new windows that require new framing, drywall, paint, etc. Clearly new energy efficient windows of the same size would be an upgrade and no more dangerous than the existing windows. I was tempted to keep the old windows in the bedrooms and replace all the other windows.
Funny you mention this. I owned some 1940s fourplexes with old windows. I replaced one building with brand new energy efficient windows of the same size. Got busted because I didn't get a permit first. So I said "f it then" and left the other building with their old crappy windows.