Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Seems like Rent control in some form or fashion Is gaining a lot of traction around the US.. Oregon just passed state wide.
Washington some new rules.. California of course has had rent control in many cities for decades.. NY same thing.
Minneapolis has some new bills etc etc..
There seems to be a target on the landlords back.. Is this just along party lines or do you landlords think this Is what the future holds over the next decade and like Cannabis laws starts in one place and will end up nation wide.
It seems these are meant to create affordable rent situations / or keep rents in check.. when I talk to landlords. I hear the oppostie
most say they will raise rents as aggressively as possible.. one to keep from having to rent to renters that heretofore U could have just rejected because of criminal or other issues..
This being a landlord dominated site would be interested in view points from others.. I have no dog in the hunt only a few rentals left but I did own hundreds of them at one time.
Bottom line I can see this in many areas having the exact opposite affect than the law makers envision.
Rental Property Investor · SE Michigan · Member since 2014 · 4k+ posts · 6k+ votes
7y
This month's Unit Magazine (published by NAA) had a great in-depth article on the topic.
There was one data point that surprised. Economists never agree on anything. But, a survey they quoted showed that something like 93% of economists agreed that rent control limits housing development and in the long-run makes housing affordability worse, not better. They even had some quotes from socialist economists arguing against rent control. So, it would seem like most of the best minds agree that it is bad idea.
Of course, many politicians don't care about facts, whether or not what they are doing is effectiveness, or even whether or not it helps or hurts their constituents They just want to get elected.
Rental Property Investor · San Francisco, CA · Member since 2013 · 1k+ posts · 1k+ votes
7y
@Robert C. funny, most of my buyouts were in the $10k range, with only two at $30k, similar to you! (The $30k we’re justified as they were 20+ years paying peanuts, Plus the negotiations were very amiable...meaning the tenant would smile and say hi to me if I saw them walking down the street.)
Like you mentioned, it’s unfortunate that S.F. has made the whole process now so damn adversarial. I agree that it’s just not worth the emotional headaches for me anymore.
I am curious about your 6 plex tenants- is there a category the “difficult” tenants fall into? Meaning, are they longer term, less upwardly mobile, feeling threatened types? Do you have any younger techies? Are they easier? Also are any of the units nicely renovated, and does that make a difference wrt tenant relations?
Investor · San Francisco, CA · Member since 2016 · 338 posts · 444 votes
7y
@Amit M., It's more the first type you mention, plus a sense of bitterness and entitlement from what I can tell. They've mostly lived there about 10-15 years now, pay around $1k in rents each. I can understand a certain amount of fear or feeling threatened in the beginning, but I went out of my way to be super transparent and as pleasant as possible when I took over the building. I fixed everything that they wanted to have fixed, made improvements to the building without doing pass-throughs, and I didn't raise their rents for 5 years. I remodeled two of the units and re-rented at market with no problems with the new residents.
I don't really compare the older residents to the techy-types and other renters. I recognize that there are generational and socioeconomic divides. However, it's really hard for me to feel sympathetic towards their attitude when I look at non-rent controlled buildings that I rent to blue-collar and immigrant families who are working really hard to get by, but they have a totally different attitude when it comes to the landlord tenant relationship.
Also, to be fair, I don't think the previous owner knew what he was doing (inherited the building), and he probably contributed to creating poor communication and relationships.
Rental Property Investor · San Jose, CA · Member since 2015 · 401 posts · 221 votes
7y
It is election year & the politicians are hungry to buy vote. And the best way to buy vote is by using other people money, landlord in this case (or tax payers’ in case of free health care, free college tuition, cancel all tuition debts ...). Lol, or in case of Andrew Yang, he straight up saying that if you vote for him and he win, he will give you $1000 per month (and never say anything about where the money come from)
Pro: Rent control helps limit supply, and raise rent. It’ll benefit the landlords that know how to work the system.
Con: It has hit the nice, long term landlords pretty back. No good deeds goes unpunished! They are nice and keep rent low for their long term tenants. Now they are stuck with them and can’t sell their apartments (or have to sell at deep discount).
Rental Property Investor · San Francisco, CA · Member since 2013 · 1k+ posts · 1k+ votes
7y
@Robert C. makes perfect sense, as I’ve heard that exact dynamic play out before time and time again. Once you get a unit vacated and renovated, you’re on a different playing field. The trick is getting there ;)
So are you planning to sell off the triplets as individual tic’s? That would max out value, unless you want to rehab and re-rent. Also it sounds like you’re not buying in SF anymore, focusing more on Redwood City? But you’re not managing your rentals directly are you, you have a PM?
Investor · San Francisco, CA · Member since 2016 · 338 posts · 444 votes
7y
@Amit M., Most likely remodel and rent the triplex at market rates. I live in SF, but I've never been that focused buying here. The two I own were sort of flukes - I would have been an idiot not to buy at the prices offered. The other "investments" I've had in SF have been places where I lived for a couple years and then sold. I've actually been in Redwood City since I started investing in 2010. As far as management, I have someone I hired a couple years ago to do all the property management internally. So, as much as I complain, I don't have to deal with the tenants directly any longer.
Are you considering any changes with your portfolio? The local regulations do get tiresome after a while, even if there is money to be made.
Rental Property Investor · San Francisco, CA · Member since 2013 · 1k+ posts · 1k+ votes
7y
@Robert C. no, I'm happy with my portfolio and I'm getting all market rents with tenants that turn over on a regular basis. Plus a couple of my bldgs are 2002 build, so no RC :) Overall it's not that bad to manage, and gives me something to do. With good tenants I really don't mind. At some point, I imagine, I'll tire of it and will probably look to outside management. So far I'm not convinced that executing 1031 exchanges into commercial NNN or DST funds is right for me. I'd rather sit on S.F. property and have a manager, if I want (semi) hands off. Chiefly because I believe that we'll still have strong appreciation over the next 10-20 years, so I might as well capture that. I'm not really thinking of acquiring more properties, as I already have plenty of rental income and equity for our needs, so playing defensive is my orientation.
Interesting that you hired someone to PM for you. How many units do you have, and what was the breakout number where you felt it made sense to hire someone? (What I like about that approach is that they can do things the way to tell them; with a pro PM firm you loose some control over the process.) I’d be interested in your take on that. Cheers.
