All Forum Posts by: Brian Hughes

to answer the original question,   I think both annual renewal and MtM agreements would still be allowed,   it would just be the case that regardless of which agreement type,  the LL would have to show 'just cause' if not renewing,   and by extension if the tenant chose to fight it,   prove it in court.  

Just cause can be very difficult to prove for some of the supposed just causes like waste/nuisance activity.   Say the tenant smokes in their bathroom.   They can make all kinds of excuses - the unit already smelled like smoke ;  the neighbor smokes not me ; the wind blows it in from next door ; I didn't see the cigarette burns during the move in inspection ; I only did it once ; somebody else left those cigarette butts outside my door, etc.   A judge hearing all of this would be left with deciding based on their own biases likely more than anything else.  

This is a substantial shift from now where (mostly) a LL can opt to terminate the tenancy at end of lease or with sufficient notice for MtM (except seattle) without stating a reason.    In this circumstance of course the tenant can still hold over,    but it is/was a guaranteed  judgement for the landlord assuming they served all their notices right.

this WILL increase the cost and risk to property owners,   and have a negative effect on housing availability and quality especially in "lower income" areas unfortunately;   through fewer small operators,   and higher screening criteria,   higher deposits and rent.

Since one of the major benefits of the renewal lease is (especially in seattle) the option to terminate without cause, I anticipate use of this type of lease will decline substantially. I use them now but probably that would end with statewide just cause in favor of an initial 12 month lease changing to MtM.

fixing up and turning around a foundering property -  and housing your parents -  and rolling your success into a 2nd 4-plex!   congrats and keep it up.

BH

Sounds like you may be renting a house by the room?   Or the home wasn't originally built as a multifamily?   

Screening is absolutely necessary to reduce risks, but "door slammer" isn't something tracked by experian or transunion, nor is something the prior landlord may know anything about depending on the configuration of their last accomodation.

Designing or updating the accomodation to reduce these sorts of conflicts is your best bet.   There are some people out there that while overall responsible people can't be bothered to consider other people all the time.   I've had a few roommates in college that were that way,   including one who was among other things...  A door slammer.   And I've had similar situations involving graffiti (modifying the fence that was being tagged by removing every other slat stopped it cold) and so on.

In addition to prior suggestions about improving weatherstripping and (especially) the door closer you might consider if the door to the downstairs bedroom is a single panel or hollow core type - if so consider replacing it (maybe all bedroom doors) with a heavier solid core or foam core door which will block sound a lot better.   If you have hard surface flooring, consider installing floor surfaces in high traffic areas which are cork backed or (cheapest, but not longest lived) wall to wall carpet or something which will deaden noise from people tromping through the halls (just expect carpet may only last a few years and plan for frequent cleaning of it)    More invasive but you could also look at having insulation added to the interior bedroom walls to block noise as well.   It can be blown in through small drill holes between the studs,    so minimal patchup work after which the contractor would do probably everything of except the paint touchup.

Knock on wood ; drink leprecauhn juice from a horseshoe or whatever..

So far my residents  (7 total) (south seattle ; burien)  are all current on rent.   One resident was slightly late for a few months as they temporarily lost their auto repair job,  but were rehired and caught up.

There are definitely some freeloaders/opportunists out there,  but they are a small minority  (low single digits percentage if not sub 1%) - no comfort if you happen to have one of them -  but odds are fairly low.    Yes,  people who screened well do so for a reason and will most likely do everything they can to honor their agreements.

keep in mind some of these rent assistance programs come with significant conditions;   Some of the assistance programs I've seen in WA require forgiveness of past AND FUTURE unpaid rent for the duration of the pandemic if any rent assistance is received,   as well as required renewal of the tenancy indefinitely regardless of payment balance from COVID period.   the future side of this is still an unknown quantity so its a risk that should be evaluated carefully.

There are also several bills currently proposed in WA legislature which are likely to pass in some form or other which will substantially affect your situation - look at SB 5139 - "temporary" rent control   and SB 5160 - extending COVID protections for 2 YEARS past end of declared emergency,   payment plans based on "tenants ability to pay"  and blocking use of eviction and payment history in tenant screening  (!!!!) 

I'm in WA and am aware of this,  but have not had to use it.   While I've had a few interested parties who were subsidy recipients when advertising/showing my units none applied after receiving screening criteria.   In the market segment I'm in though eventually I'll probably eventually have or inherit a subsidized tenant whether it be Sec8 or some other program.

I'm sure that other WA people would be interested in more specifics around your experience with the program.   Under what circumstances have you had to use it  (change/omit names to protect the innocent or slightly guilty of course)

You and lots of other people have this problem to some degree or other.   I have 7 rental units in burien/seattle.   Most of my rents are probably within 80% of market,    but since the moratorium started one of my properties the county taxes have gone up by 50% and the other by about 20% and of course I can't pass that on right now.   By the time the moratorium expires taxes may well have gone up again.

I think (but you need to confirm it) that you can give NOTICE of rent increase right now,  but you must clearly state that it will not go into effect until the governor's emergency declaration and moratorium ends;   and of course by then we are probably going to have some form of rent control thanks to Sen. Kuderer.   (Also 2 years of extended tenant protections such as additional screening rules,  mandatory lease renewals,  etc also Sen. Kuderer)  The current proposal allows 3% plus inflation per year increase,   and is supposedly temporary.   Yeah,  right.

If you want to keep holding the property,   I would probably try something like this:   Give the tenant notice of increase now which is compliant with all laws / and emergency declarations.   You can add some wording saying if your stated increase (like 6% or something) exceeds any limits imposed before it takes effect it would be reduced,   e.g.  if we get rent control as described above with 2% CPI it would be 5% instead),   and explain to the tenant that owing to the work the home needs  (you can provide estimates of this)  you need to get closer to market rents in order to finance and justify the improvements.   Hopefully the tenant will understand and either accept the gradual increases,  or move out,  allowing you to ask more of an incoming tenant.

Or, since its a SFR if the home itself is in decent condition somebody WILL buy it given the housing market around here. Fixing the exterior issues may or may not pay off in the sale price, talk with a couple agents and get some estimates to figure out what pre-sale improvements would pay off.

If you do sell,  that is grounds even under the moratorium to terminate the tenancy,   assuming it is MtM and of course you give proper notice.   

Good luck.

PS if you have not joined a WA LL association like WLA or RHAWA please do.

 

My OCD won't let this go.   The other major thing I forgot is fire safety.    At minimum every rented room should have a smoke detector  (ideally hardwired,  batteries WILL walk away) and a fire extinguisher.   The rooms to be legally usable as sleeping areas need a minimum size,  and must have a properly sized and positioned egress window.   Rules on this are partly waived if a bedroom was built before a certain date (I forget when,  sometime in 70's)  but if a room doesn't have two practical escape routes, either FIX it or don't rent it.    If a room is not on ground floor,  provide an escape ladder.    If the window is too high,  add a built in step below it.    If the window is painted or jammed shut,  fix it.    Replace flimsy hollow core interior bedroom doors with solid core for better security, fire safety,  and noise reduction for the room resident.

There is definitely a need and a niche for congregate housing / boarding houses,  but the management can be a lot of work.

While I don't do rent by room I do have some tangential experience / observations : There are several well established such properties in the neighborhood of one of my buildings,  I have had several roommate situations (one lease agreement though)  and my current personal residence was previously a boarding house hosting at least,  but probably more than 4 separate tenants.   I live in in Seatle and my rentals are in Burien and Seattle.    I also spent cumulatively 4 or 5 years living in boarding houses, mostly in U district during college,  and some ran batter than others.

1)  I would not try to go past 8 residents.   One question to be asked though is what if say 2 residents are "related" and share a room such as a couple?   That might mean 9 total people,  but (except for utility billbacks) you can't charge more for the same rental for more people.

2)  Check how this interacts with Seattle's recent roommate ordinance.   Your desired approach may actually be the only way to partially work around it,  IF you do separate leases for each room.   But you will still have to be prepared for boy/girlfriends and other tangentially/dubiously related indivdiduals to come and go and swap themselves out within rooms.  But at least you would have some control with the individual rooms,  vs. if it was full building lease,  in which case it could very likely become an unmanageable free for all especially given current moratoria on enforcing most rental agreement terms.

3)   It is absolutely a good idea as you are thinking to provide common area cleaning and services,  not just to keep the peace among residents,  but also to keep an eye on the property.   Trying to put a kitchenette in every bedroom though may be a bad idea,  though minifridges could be a good peacemaker since people could keep more of their food there.   In fact,  I'd probably add to leases no cooking in the bedrooms,   only in designated common kitchen area.    8 hotplates and microwaves going at once == fried wiring or worse.

4)   Decent,  durable common areas aren't a bad thing,   so trying to make tenants avoid them I don't know.   But definitely don't install or provide anything that you don't expect to wear out very fast or walk away.   Old TV,   Old but sturdy furniture,  hard surface floors,  etc.    I would not buy consumables like toilet paper.   No landlord I ever had did that in any boarding house,  and whenever somebody (ahem me) tried to get people to chip in for things like TP,  I ended up buying the first bulk package,  and it all disappeared literally overnight.    Let people keep TP and such in their own rooms and bring it to the bath.   The only exception I would make to not providing common consumables is I would ensure a supply of cleaning equipment  (brooms, mops,  (old) commercial grade vacuum cleaner, etc.)    If you do decide to supply other consumables,   put it in everybodys lease that you supply X amount per month to be shared,  and any excess use is tenants responsiblity to buy for themselves,  and you do not referee or apportion use except that taking it all for yourself is not permitted.    If you provide washer/dryer,   make sure they are card or coin operated.   Otherwise they will be abused to death.

5)   If and when you get responsible longer term tenant(s) you might want to see if they are willing to act as a resident manager to help keep an eye on things,  but be sure to square this with WA employment law,  or you can get into a lot of trouble.   I would also strictly limit their responsibility to watching things,   basic cleaning,  trash removal, keeping walkways clear, reminding people of responsibilities,  and reporting to you.   I would not have them doing things like trying to collect rent, show units,  or enforce any issues.   Too legally risky these days.

6)  Screening, written and enforceable rental agreements,  and deposits:   Even with cheap rooms,  DO IT ALL.    Obviously you aren't looking at "high end" tenants for rent by room,  but that makes this even more important.   Unfortunatey some of the best tools in my experience for screening on the low end of the spectrum are now blocked in seattle -  You have to offer payment plans on deposits and last months rent unless they are a pittance (25% of rent)  and there is literally no recourse if they fail to pay.   So if you are aiming at students,  I would look very closely at things like getting as many parents and guardians as cosigners as possible,   and require people to actually do have verifiable income and relatively stable employment  (not necessarily same job a long time,  but a succession of same kind of work,  ideally with increasing resposniblity)  Even at minimum wage full time I'm guessing it should be possible to afford a rented room in a 6-8 bedroom house no problem,  so don't compromise on that.

7)   Parking:   if you have onsite parking,   you probably won't have 8 spaces,  so reserve and charge for it.   But don't go after people or tow cars unless the renter of the space complains somebody else is taking it.   They may share/swap the space(s) among themselves which is fine as long as they are all agreeing and it is being paid.

8) I definitely have had utility hog roommates in both my own experience living in a boarding house and with roommates in my rentals.   Unfortunately there is very little you as landlord can do about it short of trying to submeter every room for water and electricity which is not feasible.    Even if you do things like install lockable thermostats,  etc people can and will plug in their baseboard heaters if they like it at 90 degrees.     In that segment people generally expect water and electric to be paid so I would probably just roll it into the rents,  allocated equally by occupants  (so a room with 2 people would pay double a room with 1 person)  and adjust annually in rent increases for actual usage.     One way to keep peace might be post monthly bills,  especially if there is a big jump.    Other tenants are your friend in the case of a utility hog - they won't want to be paying for them either.

9)   Definitely install,  and periodically verify presence of,   low flow showerheads,  toilets,  LED lighting throughout etc.

10)  bedbugs, cockroaches, ants, and viruses -   there is more risk of all of this given the current times and the type of housing you are looking at.   Its not uncommon at by the room housing for basic furniture to be provided including a mattress,  and if you go that route you should have some kind of a procedure on turnovers and regular inspections to look for bugs.   Hard surface floors instead of carpets will be helpful there too.   On viruses, cockroaches, and ants,   already planning on providing periodic common cleaning is a good start,   you may want to consider other strategies to limit virus spread in common areas,  or at least state in leases what you will and won't provide.    In addition to common cleaning there should be 6 month room inspections too,   even if just opening the door and looking in ;  making sure they aren't cesspools or drug labs.

11)   the biggest thing I think is you should be planning a great deal of hands on involvement.   You may get stable periods when a group of roommates really hit it off and stay together for a few years,   but there will be other times with constant drama and turnover.   

Good luck.

I had a similar situation with my first investment property, a triplex in seattle.   the south facing  (front) wall had noticeable settling around some of the windows.   I initially didn't think too much of it and inspectors didn't notice anything, but when having the windows and exterior doors replaced we discovered a lot of rot in the window and door frames.   The old single pane aluminim frame windows somebody had drilled holes along the bottom of the frames,  which let all the water hitting the windows drain into the wall.   Not sure if it was some long ago attempt at sabotage or some kid playing with a drill or what,  but damage was done.    Also this building was built without any kind of a vapor barrier,  just T-111 siding right over the studs.  The only vapor barrier is the paint.    Cheap construction.

On next turnover of the affected units I had to tear out and replace pretty much all the framing around the affected windows and door frames from the middle of the windows down to the floor joists and rim joist.   Fortunately the rot petered out at about the subfloor plywood.   I got a bit creative to avoid having to remove the window frames completely,  but still had to replace a fair amount of framing, subfloor plywood, and exterior sheathing as well.    the most fun part was in the lower unit I had to jack up the whole upper story about 3/4 of an inch to take out most of the settling over the worst window frame.   This wasn't quite as hard as it sounds as I had access to some equipment big enough to do it and some major beams in the building were in about the right places to make it easy(ier).   That removed most of the settling that had occurred.

I would not expect framing damage to extend much past the wall around and below the windows,  but it just depends on how severe the moisture intrusion was and how long it went on, and also the age of the building is a factor as that may affect what types of wood and other materials were used,  different kinds of wood handle moisture and rot better than others.   If there is framing damage throughout the issue is probably more than just a window leak,  the bigger issue in the rest of the unit might be mold,  which may not damage the structure but could still require remediation.

Good luck.