TACOMA WASHINGTON – Rental Proposal

The city of Tacoma, Washington is considering a Just Cause Eviction Ordinance similar to Seattle’s.  The drafted provisions include:

• 60-day notice requirement for rent increases

• 60-day notice requirements for termination of tenancy

• Relocation assistance ordinance which requires owners to host in-person meetings with tenants

• Move-in fee installment payments

• Requirement that owners inform tenants of any code violations at the property within the past 12 months – even if caused by the tenant

• Requirement that owners provide an “information for tenants” packet to renters

While they consider these provisions, the city has passed an ordinance which requires landlords to give tenants a 90 days’ notice when tenancy is being terminated due to “demolition, substantial rehabilitation or change of use of a residential dwelling.”  This law goes into effect on September 30, 2018.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

RENT vs. BUY

According to Realtor.com’s July 2018 renting vs. buying report*, home prices rose more than three times faster than rents.  The monthly cost of owning a home rose 14% last year while the cost of renting rose by 4%.  According to the report:

• Only 41 percent of the nation’s population lives in a county where a median-income family can afford to buy a home.

• In July, buying a home was cheaper than renting in 35 percent of counties, compared to 44 percent of counties last year.

• The top five counties where purchasing a home was more affordable than renting last month were: Clayton County, Ga.; Baltimore City, Md.; Wayne County, Mich.; Cumberland County, N.C.; and Madison County, Ill., with the share of income to buy being 4 percent to 14 percent lower than the share of income to rent.

• Renting remains much less expensive than buying in Manhattan, N.Y.; Brooklyn, N.Y.; Monterey County, Calif.; San Mateo County, Calif.; and Santa Barbara County, Calif.

• In the last year, 20 counties with 100,000+ residents flipped from being cheaper to buy to being cheaper to rent, three quarters of which were in the South and Midwest.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

*https://www.realtor.com/research/july-2018-rent-vs-buy-report-home-prices-rise-three-times-faster-than-rents

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

PROTECTED CLASS – Marital Status

Marital status is a protected class in Washington State.  Marital status includes being single, married, separated, engaged, widowed and divorced.  In the City of Seattle and in King County marital status includes cohabitating. This means that landlords must treat roommates or unmarried couples the same as married couples.  In other words, a landlord can’t limit tenants to what he or she defines as a family.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

INVESTOR LOANS with a catch

Freddie Mac has a new program that will offer lower cost financing to investors of apartments who agree to cap rent increases for the life of the loan. The goal is to create rent control by keeping units in private hands and controlling the rate of rent increases.

Recently investors have been buying less expensive buildings in need of renovation and then raising rents, resulting mid-priced apartment rents raising even faster than luxury units.  According to RealPage Inc., average rents for midrange Class B properties rose by nearly 20% from 2012 through 2017, while high-end, Class A rents rose by 16.6% on average.  This initiative will help Freddie Mac fulfill its mandate from the Federal Housing Finance Agency to lend to underserved communities.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

SEATTLE & Property Ownership

The City of Seattle contracted with the UW to study the impact of recent changes in rental ordinances. The Seattle Rental Housing Study (SRHS) was published in July 2018.  Tenants surveyed expressed skepticism about the effectiveness of the ordinances while the landlords surveyed found the ordinances highly burdensome and ineffective.  Highlights of the study follow or you can read the entire study at https://www.seattle.gov/Documents/Departments/CityAuditor/auditreports/UWSRHSFINAL.pdf.

• Legislation targeting landlords has led to, and is leading to, an increase in owners selling rental properties (40% of respondents), especially for mom-and-pop landlords (47% of respondents own/manage one unit). Every time landlords sell, rents are pushed up.

• Small rental owners charge lower rents and have more flexible screening criteria than large, corporately held rental housing.

• A large majority of rental housing owners (61%) rely upon their rental property as a long-term retirement asset or secondary source of income. Only 12.7% of respondents rely on rental income as their primary source of income.

• The large majority of landlords are not wealthy; 59% are cited as earning less than $75,000 per year. Only 8% reported incomes over $150,000 per year.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance. 

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

 

CHANGING TENANTS

The tenants in a lease cannot be changed without the signatures of all parties to the lease.  This is important when roommates share a rental and one wants to move out before the other.  Unless all roommates, any co-signers, and the landlord agree in writing otherwise, the vacating tenant remains responsible for all terms under the lease, including payment of rent and repairs for tenant caused damage.  The vacating tenant will remain responsible until either all of the original tenants vacate or a written amendment to release the vacating tenant is signed by all.  This is true even if the original agreement has expired and the tenancy has converted to a month-to-month agreement.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

 Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

 

BUYING A TENANT OCCUPIED PROPERTY?

What you need to ask for if you represent someone buying a property with a tenant in place?  The following should be requested as part of the buyer’s due diligence:

• Lease and any addendums – the property is subject to the lease terms.  At the end of the lease or if a month-to-month rental agreement, terms can be changed with a 30-day notice.

• Move in inspection report – the tenant cannot be charged for any damages unless there is a written move in inspection report.

• Rent ledger – this will tell the buyer whether the tenant pays rent on time.

The following need to be transferred at closing:

• Any deposits and prepaid rent (last month’s rent).

• Pro-rated rent for the month of closing.

• Keys (easy to forget if buyer isn’t taking possession at closing).

• Tenant contact information.

The seller must notify the tenant in writing that the deposit has been transferred to the buyer and the buyer must notify the tenant in writing of the Washington State bank and branch where the deposit will be held in trust, where to mail rent and who to contact in case of a problem.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

 Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

RENTAL RATES – UP OR DOWN?

The increase in new construction apartments has resulted in higher vacancy rates and lower rents.  In Seattle, new apartments are offering up to two months free rent.  According to CoreLogic, vacancy rates in apartments range from 3.9% in Des Moines to 25% in downtown Seattle.  This has impacted the single-family rental market as well, which had the slowest increase in rents since the recession this year.

In 2017, Seattle’s rent growth was the highest in the country with a 5.2% increase year-over-year.  In 2018, Seattle’s rent growth dropped to 22^nd in the nation, according to ApartmentList.com.  Rent growth also slowed in Portland.  Nationally, rent grown has slowed from 3.6% in 2015 to 1.5% year over year in 2018.

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

RENTERS INSURANCE

The content found above was created by Amica Insurance Company. Coldwell Banker Bain is not affiliated in any way with Amica insurance and this video was posted for informational purposes only. You are advised to obtain multiple quotes from different insurance carriers.

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.

FAIR HOUSING – BETWEEN THE LINES

You know that fair housing laws require you to treat everyone the same, but that that means you must treat all rental applicants and tenants the same in even the subtle aspect of the rental process.  Examples include:

–          If one tenant moves in mid-month and you allow him/her to pay pro-rated rent rather than a full month’s rent, then you must do the same for everyone.

–          If you require photo I.D. from one applicant, you must do so from all applicants.

–          If you ask one applicant if s/he is a legal resident, you must ask all applicants if they are legal residents.  (There is no requirement to verify proof of legal residency when providing housing in Washington State.)

We are here to help you and your clients with all aspects of the rental market. Please contact us for further assistance!

Nothing found herein should be construed as an attempt to offer or render a legal opinion or otherwise engage in the practice of law. You should not rely solely on this information. We encourage our clients to work with a lawyer experienced in commercial and/or residential real estate matters as they can be complicated and confusing.