All wanted to share with you an ongoing heated dsicussions between City of San Jose, Landlords and tenants about rent control. Share your thoughts here and with the city...
Summary of proposal: http://www2.caanet.org/webmail/77272/98976067/206f...
Draft proposal: http://www.sanjoseca.gov/DocumentCenter/View/54657
Amos
Amos,
So they take something that doesn't work elsewhere and try to apply it here. That's typical bureaucracy for you.
Since 2000 until now, they had 14 debt pass through and one capital improvement petitions, that's averaging one/year in a city of more than 1 million people, and they're making a big deal about it. They say they want landlord and tenant to have a relationship while they're squeezing themselves in the middle regulating rent control and collecting permit fees. It's all about building a legacy for themselves, and it has nothing to do with the people IMO. :>)
They say they want to be a leader while it's obvious that they're followers of San Francisco, Oakland and Berkeley. If they truly want to be a leader, they should abolish rent control, but I digress. :>)
If this rent control ordinance passed, I bet they would see more dilapidated buildings as landlords would likely not put money back into improvements as they don't get their returns. My partner and I thrive with these issues. We see opportunities where others don't. In fact, we were strategizing our next move over a golf game yesterday. Life is good when you don't have to work on other people's schedule. :>)
Thanks for sharing.
Thanks for this Karen. California seems to be more and more of a luxury to live in. I can say that's very much the case living here in LA, and most def where you're at.
I'm looking around for a rental property and there seems to be many 4plexs coming to market of San Jose recently. 1) do you guys think the rent controll is causing this rush to sell? 2) now that the supply is high, what do you think of buying a property even though its rent controlled for a better price?
I'm analyzing a 4 plex right now and I've yet to hear back from the sellers agent but I'm eager to hear what the current rental rate is. That will be a large deciding factor on if it will cash flow what I want it too. If rents are low then it will take several years to get up to market and has a heavy impact on the cash flow.
I'm looking around for a rental property and there seems to be many 4plexs coming to market of San Jose recently. 1) do you guys think the rent controll is causing this rush to sell? 2) now that the supply is high, what do you think of buying a property even though its rent controlled for a better price?
Good question... this is what the price behavior has been in the last 5 years for instance in San Jose:
If you bought in San Jose in 2011, you likely have experienced price increase of 50% or more in property value.
Regulators obviously don't want rent to escalate at such a dramatic rate, outpacing wage levels but the landlords of course will be wailing about how an attempt to align rent price increase to inflation (and up to 8% it seems which is higher than inflation of 3%), will somehow likely trigger their bankruptcy.
Would you rather cash flow (and barely in some markets) but experience stagnant or declining property values? We all would like to eat our cake and still have it too wouldn't we?
San Jose City Council will meet next week to vote on additional rent control measures, including changing the current 5% rent cap to an inflation based index. The CAA has issued a Call to Action here:
https://caanet.org/san-jose-consider-draconian-ren...
A broker forwarded me the form letter below. If you own investment property in San Jose and oppose rent control, you may want to consider sending.
Email addresses to send to can be found in the table at the bottom of this link: https://www.sccaor.com/call-for-action-tell-the-sa...
Dear Mayor and City Council,
As a property owner in the City of San Jose, I am concerned with the changes to the Apartment Rent Ordinance recommended by the Housing Department. I value the relationship with my tenants and I am committed to providing a safe, clean and desirable place for my tenants to live.
But the changes that have been recommended will hinder my ability to provide that quality housing. The current cap of 5% has been in effect for less than a year and we haven’t seen any data to determine what impact the current cap has had. It’s important to remember that a 5% cap only allows rents to go up by no more than 5%. So I’m asking that you maintain the current cap of 5%.
RUBS, Ratio Utility Billing System, provides property owner the ability to share utility costs with our tenants. By sharing the cost of water and trash with our tenants, they are given a metric to understand their consumption and a motivation to take actions to reduce their costs. San Jose has a set of green goals to reduce our environmental footprint. With ARO apartments making up a third of all housing units, providing property owners with the ability to encourage our tenants to conserve will assist the City in meeting those green goals. So I’m asking you to maintain the use of RUBS.
Since 2015, the City Council has reduced the rent increase limit, eliminated the ability to save unused rent increases, and imposed eviction controls. Every problem that was surfaced, has been addressed. It’s time to stop punishing the city’s housing providers and evaluate what’s been done.
I appreciate the time and energy you have spent on this very important topic. As a housing provider, I take the responsibility of providing my tenants with a safe, clean and desirable place to live very seriously.
Thank you,
Property Owner.
Thanks for sharing. I just found out duplexes will be included in the discussion tonight to be under rent control. This was a late add on with no transparency or warning. The official meeting will start at San Jose City Hall today at 1PM. Everyone should make an effort to show up to represent the landlords. This is extremely unfair without hearing both sides and only favoring the tenants. Here's the Agenda: