Vote against new tenant RLTO in Chicago

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Vote against new tenant RLTO in Chicago

Henry Lazerow
Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes

I encourage everyone to respond to this call to action regarding the changes to the RLTO being proposed by the Mayor. This ordinance will impact landlords' ability to renovate their units as well as for new conversions/construction projects to continue within the city of Chicago. 

The proposal:

-Increases the tenant notification of lease termination to 90 days, up from 30 days.

-Mandates that even if the tenant is given proper notice, if a landlord renovates, converts to condominium or demolishes their property within 3 months of the tenant moving out, they will have to pay the tenant a $2500 relocation fee.

Cast your vote against here... https://www.votervoice.net/ILRealtors/Campaigns/74776/Respond

Thank you for your support.

    11Reply
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    Most Popular Reply

    Sarah Lewis
    Investor · Chicago, IL · Member since 2017 · 40 posts · 33 votes
    6y

    I think if we want to make an effective case against this legislation, we need to think about unintended consequences that will end up hurting tenants. We already know people/politicians don't 'feel our pain'. 

    When I read the legislation, as written, it seems that it would be safer for landlords to NOT sign yearlong leases. 

    Seems like that will mean that tenants will have less, not more, security. 

    Remember when everyone took security deposits? Then the laws fining landlords for technicalities, like not keeping deposit in a separate account, or being 5 cents off on interest came to be. I don't know about your, but I have moved away  from security deposits altogether and no do a 'move in fee' of $300 or $400 dollars. Works out great for me! I get to keep the entire fee as opposed to returning the entire security deposit.

    3Reply
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    • John Warren
      Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
      6y

      @Henry Lazerow thanks for posting this. I had sent in my response previously. This is the kind of legislation that adds insult to injury in tough times for land lords and developers. 

      2Reply
    • Brie SchmidtBusiness Member
      Moderator
      Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
      6y

      @Henry Lazerow - thanks for posting.  All landlords in Chicago and cook county need to take 5 seconds to submit an opposition 

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      1Reply
    • Sarah Lewis
      Investor · Chicago, IL · Member since 2017 · 40 posts · 33 votes
      6y

      I think if we want to make an effective case against this legislation, we need to think about unintended consequences that will end up hurting tenants. We already know people/politicians don't 'feel our pain'. 

      When I read the legislation, as written, it seems that it would be safer for landlords to NOT sign yearlong leases. 

      Seems like that will mean that tenants will have less, not more, security. 

      Remember when everyone took security deposits? Then the laws fining landlords for technicalities, like not keeping deposit in a separate account, or being 5 cents off on interest came to be. I don't know about your, but I have moved away  from security deposits altogether and no do a 'move in fee' of $300 or $400 dollars. Works out great for me! I get to keep the entire fee as opposed to returning the entire security deposit.

      3Reply
    • Baris Yuksel
      Investor · Chicago · Member since 2019 · 20 posts · 19 votes
      6y

      Voted!

      1Reply
    • Ivy Pierce
      Hazel Crest, IL · Member since 2017 · 38 posts · 11 votes
      6y

      Thanks Henry I’ve signed & shared.

      0Reply
    • Andy Nathan
      Rental Property Investor · Chicago, IL · Member since 2019 · 203 posts · 119 votes
      6y

      @Henry Lazerow Thanks for sharing! Voted!

      0Reply
    • John LaRocca
      Real Estate Broker · Chicago, IL 60605 · Member since 2017 · 7 posts · 3 votes
      6y

      @Henry Lazerow

      I'm in as well!

      1Reply
    • Account Closed
      Member since 2020 · 6 posts · 6 votes
      6y

      Hi there, thanks for posting about this Henry! I'm new and just starting out in the Chicago market and there are a dizzying amount of laws/legislation. I just read the text of the legislation and it looks like this does not apply to owner-occupied buildings containing six units or less. Is that everyone else's understanding?

      I'm also wondering and couldn't quite tell, but does the "Relocation Assistance" apply in cases where the landlord intends to not renew the lease in order to significantly rehab the unit? (as opposed to terminate a lease before it is up)?

      0Reply
    • Lumi Ispas
      Real Estate Consultant · Chicago, IL · Member since 2014 · 720 posts · 439 votes
      6y

      @Account Closed, I have sold a condo for an owner that lived in a 12 unit with a fire door that separated the building in 6 units. The client lost 3 times the deposit to the tenant and $69,000 in attorney fees because he thought the law does not apply to him. Imagine how the law got interpreted in this case. My client was ordered by the court to list the property immediately to pay the attorney fees! 

      Chicago is 70% occupied by the tenants. The judges and aldermen are tenant-friendly not landlord-friendly. If the law passes the way it is, the attorneys will have fun with it. "Major improvements" of just paint and buying new appliances due to raising rent by 30-40% as the previous tenant was long term in the property and paid under-market rent, can be counted as "major improvements", and tenants can demand that $2500 up to 3 months after the tenants moving out. 

      As @Sarah Lewis mentioned, a lot of these laws start with the good intention of protecting the tenants, however, due to the fact that economics is not a linear model, most tenants get hurt by these new laws. Think of how many investors will not buy in Chicago or chose not to remodel, which in turn will not help neighborhood grow, not help prices going up, not increase property tax - which will hurt the 70% tenant occupied city further as they will miss out on benefits the city will get from property tax payments, plus the staying buyers will find a way to either increase rents even further or add some fees to the new leases. 

      While I agree that a 60-day notice would help tenants, 90 is pushing it, especially as we are in an area that has seasons and our rental market is seasonal.

      I've personally voted and sent it to all my clients and realtors I know. Hope you all do the same so we share with the City leadership our personal beliefs and the fact that every decision has a lot of unintended consequences that hurt exactly who is intended to be protected.

      1Reply
    • Derrick Washington
      Member since 2020 · 17 posts · 2 votes
      6y

      Thanks VOTED

      0Reply
    • Sarah Lewis
      Investor · Chicago, IL · Member since 2017 · 40 posts · 33 votes
      6y

      Looks like the legislation passed. Does anyone have the actual text and when it goes into effect?

      0Reply
    • Ivy Pierce
      Hazel Crest, IL · Member since 2017 · 38 posts · 11 votes
      6y

      @Sarah Lewis I have not. Thanks for letting us know it passed. I’ll be on the look out.

      0Reply
    • Henry Lazerow
      OP
      Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
      6y

      It's only applicable if you have over 6 units in building so won't affect most of us but is pointing to a downward trend for private property rights in Chicago. It's important everyone voices their opinion when it comes time to vote for local leadership in our city to help keep these Marxists out of power who clearly never paid attention in history class. 

      I believe this was the closest to final call before it passed. Not sure on the exact results. This is from July 16th.....

      During the latest City Council meeting, many Aldermen voiced reservations about the relocation fee, so it was pulled from consideration and replace by substituted provisions, including:

      • Allowing a tenant to pay back rent after an eviction process begins
      • Rent must be accepted at any time prior to a judgment being entered
      • Tenancy of fewer than 6 months get 30-days notice, tenancies of 6 months to 3 years get 60-days notice, and tenants of more than 3 years get 120-days notice
      2Reply
    • Sarah Lewis
      Investor · Chicago, IL · Member since 2017 · 40 posts · 33 votes
      6y

      @Henry Lazerow

      Pretty sure it applies if 6 units or under AND owner occupied.

      0Reply
    • Henry Lazerow
      OP
      Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
      6y

      Below are the exclusions in city file under RLTO chapter. Sounds like will apply once you stop house hacking even if below 6 units. @Mark Ainley care to help explain? 

      Rental of the following dwelling units shall not be governed by this chapter, unless the rental agreement thereof is created to avoid the application of this chapter: (a) Dwelling units in owner-occupied buildings containing six units or less; provided, however, that the provisions of Section 5-12-160 shall apply to every rented dwelling unit in such buildings within the City of Chicago; (b) Dwelling units in hotels, motels, inns, bed- and-breakfast establishments, roominghouses 

      0Reply
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