Landlord Regulations – Should I Just Give Up?

Landlord Regulations – Should I Just Give Up?

Veteran property manager Cory Brewer weighs in on landlord regulations.

By Cory Brewer

Here in Washington, and specifically in Seattle, the residential rental-housing community has faced wave after wave of new legislation over the past five years or so.

Similar things have been taking place with our neighbors to the south, in Oregon and California with landlord regulations.

Anecdotally, we hear “enough is enough, I’m selling,” from rental-housing providers in the area, and we have even heard this from our own clients.

But I am here to offer some words of encouragement to the landlord who is thinking about walking away from his or her investment property.  I’ll start with this:  “Don’t panic.”

Rather than get too specific (details of the Seattle winter-eviction ban, and last year’s SB 5600 “eviction reform” bill, have been well-documented), I’d like to speak in more of a general sense about what I see happening in the local legal community.  There is a very vocal group (or groups) of people who have identified landlords – scratch that, HOUSING PROVIDERS – as a key contributor to the very real homelessness problem that we face in our region.

They paint a very unfortunate “Us-vs.-Them” picture.

Time after time, lawmakers and policy drafters are looking for a solution by manipulating the relationship between landlords and tenants with landlord regulations.  I suppose it’s an easy target, and an easy public-opinion campaign to manipulate.  But the reality is that a unique chain of events takes place for each person that ultimately faces eviction or homelessness, and there are other ways that lawmakers can attempt to assist without placing unfair risk in the laps of landlords.  Many of those other solutions, such as providing more mental-health counseling, are far more complicated than slapping a new restriction on a landlord.

That said, I am encouraged by what I have seen transpire in legal proceedings thus far in 2020.

While the winter-eviction ban still poses some serious questions about infringement upon property owners’ rights, the perspective of the “small landlord” is fortunately being heard in a more significant way than in years past.

Thanks in large part to grass- roots efforts by landlords, property managers, and professional organizations such as the Rental Housing Association (RHAWA) and NARPM, the voice of the “small landlord” is being heard.

Representation of the “small landlord” is my primary objective in my role at my property management firm, and that is the perspective I write from.

As a quick example, the original proposal for a winter eviction ban in Seattle would have captured all rental properties across the board.  What ended up passing makes an exemption for landlords who own four or fewer rental housing units.  So there is a silver lining for your everyday, “regular” investor (as opposed to large corporations).  I am by no means endorsing the winter eviction ban be applied to landlords of any shape or size, I’m just saying that the mom-and-pop types were factored heavily in the final version of the law.

We are seeing this type of consideration at the state level, as well.

Landlord regulations

Bills were introduced this year covering a wide range of aspects within the landlord/tenant relationship, chiefly among them rent control and just cause.  I think we’re all familiar with the concept of rent control, so I will not elaborate here other than to say it was voted down and is not an immediate concern in Washington (we’ll talk again next year), and that the version passed recently in Oregon is more of an anti-gouging measure, at least in its initial roll-out.

Just as importantly, there was a bill proposed that would effectively turn every term lease into a month-to-month tenancy after the first 12 months, and thus subject to a just-cause eviction process.  This would have been a potentially devastating blow to the stock of single-family rental-housing supply, and fortunately there were enough lawmakers in Washington wise enough to recognize this.

It’s not uncommon for a small landlord to put a home up for rent on a temporary basis – say a year or two – while they move out of the area on a work assignment.  They intend to move back, so they don’t want to sell and they don’t want it to sit empty, either (their insurance provider might not be too happy about it if they did!).  So they offer the home into the pool of available rental housing, and in the process they do the community a much-needed favor.  It is crucial that this homeowner be allowed to set very specific term-expiration dates on their leases.  Compare this situation to a large corporate landlord running thousands of apartment units … their goals for tenant occupancy two to three years down the road are quite different from the goals of the small, temporary landlord described here.

Every time I’ve personally had a chance to speak to a lawmaker in Washington, on any level, I continue to make the argument that blanket policy on landlord regulations does not work.

Considerations have to be made for the different types of landlords out there, the different types of properties that are being offered for rent, and the different priorities and perspectives that people have.

I am encouraged that this message seems to be resonating.  And my message to the housing provider who is worried about what legislation might come along next?  To them, I say “Perhaps it’s time you speak with a property manager.”  We are doing everything we can to ensure that rental property remains a solid investment option, which translates to contribution of housing supply.  A win-win!

The personal involvement of housing providers is important, too.  Write your representatives when you have concerns, and tell your side of the story.  Often times these policies are proposed without a thorough review of the unintended consequences.  As we’ve seen so far in 2020, the more we can band together and make our voices heard, the better.

We should all be working together – landlords, tenants, and lawmakers alike – toward the common goal of sufficient, successful, affordable housing for everyone, and policies that incentivize investors to make the supply of rental housing available in the first place.

About the author:

Cory Brewer is the General Manager at Windermere Property Management / Lori Gill & Associates. Cory oversees a team of property managers in the Greater Seattle Area with a portfolio of approximately 1,500 rental properties. Active in the local real-estate community since 2003, he has held his current position since 2011. Cory may be reached via www.wpmnorthwest.com or coryb@windermere.com

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