Thursday, June 19, 2008

I saw this article on MSN recently which sort of stuck in my craw a bit.

Here the article speaks of the renting of an apartment as a brutal task, but I don't think they parse the transaction in fair terms. I freely admit we live in a world where slumlords are more than happy to bilk tenants for all they are worth while not providing the services and facilities as promised in the contract. However, every major city in the USA has a health department and most of these cities have renters' rights organizations who come to the aid of renters for little or no money. Landlords who do not deliver goods and services as promised contractually should be subjected to the maximum penalties for reneging. As intimidating as the rental contract may be, it is as much for the protection of the tenant, if not moreso, than it is for the protection of the landlord/property owner. Renters should be aware of this and do all in their power to hold bad landlords accountable. However, most apartment communities fall in the middle of the road between the high-end luxury accommodations and the outright slum, so hopefully most of us will never have to deal with a nightmare scenario rental.

From the article:

It begins with a strip-search of one's personal data, a "privilege" for which the renter pays via a $35-plus screening or application fee, moves through an automated revenue-management system that imposes upon him the highest possible daily market rent and ends with add-ons such as mandatory renter's insurance, multiple pet fees or extra coverage for the owner's pool lest another tenant cause damage.

In truth, since I first rented an apartment more than 20 years ago, I always have understood a screening of my personal data and a check of my references would be included in the administrative process of determining if I were a good candidate for their community, as well as my ability to pay. What is so difficult to understand about this? Staff need to be paid for the time they spend vetting applications. We also pay a fee to a credit reporting service through which we check the applicant's history. This is reasonable. Why should anyone be indignant about proving themselves worthy of access to hundreds of thousands (or millions) of dollars' worth of property? When I hand a person the keys and the gate opener, I need to be absolutely confident that this new tenant will be respectful of their neighbors and of the community and property in general. I think our application process is the best method available to be worthy of the confidence other residents have placed in these apartments.

I don't use the credit number system as assessed by the credit reporting agencies, but instead have a process by which I contact employment and rental references, and check the credit report. If a person has outstanding medical debts, for example, we overlook those particular debts. That's a judgment call, and I think it's a kind and fair one. Perhaps my community is the exception, but the final call is mine to make, and I'm glad of it.

The article goes on to breathlessly proclaim that the following are realities just around the corner as made possible by online data:

Rents that change from day to day
Rental-specific credit scores
Checks of criminal, sex-offender and terrorism databases
Checks of housing courts, eviction notices and rental histories
Income verification that can include pay stubs, letters of employment and tax returns
Fees that effectively raise monthly rents

Um, okay.
Rents that change from day to day-- If you are in a binding lease agreement, the property is bound by law to provide your apartment at the agreed-upon rate and for the agreed-upon term. This may be the most misleading portion of this article - it implies that like the price of gas, the amount you pay for your apartment may change from day to day. I believe what they actually mean is that the community may change the rate for future rentals from day to day. This is natural. You may have signed a 2 or 3 year lease, yet the taxes on the property may have increased to such a degree that higher rents must be charged, and thus the person who moves in to a unit identical to yours may be paying significantly more.

Rental-specific credit scores-- I don't know what they mean by this, but some apartments do report to credit agencies when a tenant has stiffed them
Criminal checks-- If I'm letting some random bloke from off the street move into the apartment next door, wouldn't you prefer I vetted him/her to see if they are a sex offender, for example? The fact that my community excludes people with violent or sexual felonies is a plus, in my opinion. Martha Stewart could live here. Mike Tyson couldn't.
Checks of housing courts/rental histories - So? Your history indicates your likelihood to pay and in many ways tells of your character. I'm an open-minded person, and I know that people can change. If they have a bad rental reference, I'm willing to hear them out and have in some cases concluded that the record did not necessarily reflect reality. In the cases where I have erred in favor of the applicant, they have always proven my leap of faith well-founded.
Income verification - Duh, ability to pay. If you are self-employed and I can't contact your human resources department, then I need some tangible proof to demonstrate to the property owners that you, indeed are who you say you are and are able to afford to live here. Those income-related documents also demonstrate that you didn't make your money by running a meth-lab, most likely.
Fees that effectively raise monthly rents - I quite agree that the upcharge for things like vehicle parking fees can be over-done. I once chose NOT to lease an apartment I really wanted because they charged $65 per vehicle for residents to park on the property, even though they were in an underpopulated industrial area with boatloads of space available. But that is the marketplace-- I took my business elsewhere, and that is everyone's prerogative.

I suppose what bothers me more than anything is the perpetually whiny-arsed worldview that every transaction involves a villain and a sucker. There is a vast array of rentals available in every American city, and if you take the time to shop, you'll find a place that suits you, I guarantee it. That is how the marketplace works. If you take the time to look around and educate yourself, there is no reason you can't find a perfect place. ALSO, look for inroads with the leasing agent or manager to open up possible negotiation. I have sometimes taken a little off the rent occasionally, or have thrown in a free covered parking space or found small ways to make the move-in easier for the new tenant. Sometimes someone asks for something I simply can not give, but I will try to find other ways to help. Perhaps instead I can change fixtures which will be improvements which will remain after you leave--please feel free to ask me to install a new dishwasher, stove and/or refrigerator. Remember that every decent apartment community expects to replace these appliances sooner or later, and this can be a great way to enhance your rental experience while not hugely impacting the landlord's bottom line. It never hurts to ask, and I want you to choose my community, and I do genuinely want my residents to be happy.

The sad fact is that if economy is your prime consideration, you will make some compromises in the areas of comfort, luxury and even possibly safety. This would also be a great time to consider that if you opt to live in a state which allows you the right to protect yourself in your own home, then your home will be as safe as you make it. I recommend Texas, in particular.

In conclusion, I think that rather than parasitic, the tenant/landlord relationship is best when viewed as symbiotic. Renters need a place to live, and landlords provide same. Yes, someone is making money in the process, but often times less than you might think, and the tradeoff is that you as renter are not dealing with tax issues, city code compliance and the host of other tediousness that is involved in keeping a property of any size running and legal. The landlord who agreed 10 months ago to the rate you are paying may have had a massive property tax hike and they are paying increased energy costs to keep the community utilities running, and all this must be paid for on the rental income they agreed to in 2007. Caveat emptor applies as much now as ever. True, renting an apartment is not of the gravity of buying a home or a car, but it is where you'll hang your hat for 6, 12 months, or more, so it behooves you to take the time to really poke around and investigate what's out there. By all means, trust your gut instincts and don't rent from someone you feel is disingenuous. But more than anything, look at it as an exciting opportunity to try on a different slice of life than you have experienced before and without the scary connotations of the longer-term commitment of maintenance etc. of buying a property of your own. Unlike the trials of home ownership, in most apartments when your terlit or your A/C go on the blink, well, that's the landlord's problem. I call those very easy terms, indeed.


Thud said...

I have been involved in all aspects of property and building for 20 years and still own a number of rental properties.In Britain the landlord is treated by all and sundry as a grasping criminal so the whole rental process is fraught with many pitfalls.i have always tried to be decent with potential tenants but experience has long washed away my altruism....I now stick to building and leave the tenants at arms for both of us.

Anonymous said...

I have an Aunt in Houston that has the same job you do. Screening applicants is a must, and she goes about like you do. It's a must nowadays. Very easy terms indeed.

Anonymous said...

Reads to me like another liberal reporter with no real knowledge of how the real world works. You know, the world owes me everything and I shouldn't be responsible for anything. And I wonder if she has a personal ax to grind maybe? And what the hell is wrong with trying to maximize income? As long as it's not done at the expense of maintenance and safety anyway.

SpeakerTweaker said...

It is comforting to know that there are landlords/apt. managers out there that realize their place between the tenant and the owner.

I had a place in SA that had a wonderful manager, who made sure that we were taken care of (which, as per the contract, shouldn't have been much of a problem). She was replaced by a more evil woman, and the unanswered phone calls, refusal to service, etc. started within two weeks.

FORTUNATELY for us, we had a clause in our contract that would allow us to break lease if we actually purchased a home. We did.


Rabbit said...

Wife's kids' girlfriend used to manage a complex in E. Dallas; nicest property in the area, but that's like having the best house on the block in a slum. To the company's credit, no Section 8, no Katrinite carte-blance, and thorough background checks on all occupants, no exceptions. An applicant with almost any felony conviction was grounds for denial, as was a drug conviction. She tended to have an older population that was in balance with community race demographics and seldom had any police calls to the property as a result of the screening. Yes, she was a hardass manager.


NotClauswitz said...

A dirtbike buddy and his brothers inherited a couple of big apartment complexes after their dad died. Despited putting on new (gigantic) roof, upgraded landscaping and full re-paints costing around $1Million+, they had no end of trouble with graffitti-taggers and deadbeats - who are hard to remove here in CA without a LOT of paperwork and documentation - so everybody got a file folder and documentation was kept religiously.
He was elected by the others to spend most of his time down at the courthouse with said documentation and file folder(s).
We own our own home-condo, and it's paid-for. Kinda makes you stuck in one place but retirement looms...

none said...

I hated renting because at the time they would only do 6 month leases and my rent always incresed $80 each renewal even when new tenents were moving in at lower rates.

I guess they figured most people would eat the cost rather than go through the trouble of moving.

Dedicated_Dad said...

As an aside, I once had a building sold while I was leasing. Woke up one morning to hear someone struggling to unlock my door. No knock, just a key in the lock. He finally got in and wasn't too happy to find my pistol in his face.

He claimed he'd been given permission to "inspect" the property, it turns out (I later found) he'd guessed the combination to the realtor's box. He walked into every Apt. in the building. Others were too scared, I escorted him from the property at gun-point.

He ended up buying the property. Harrassment? Ha. Cut off my AC in my 3rd-floor/attic Victorian Apartment. Temp over 110 inside, I had (2) little kids -- I had to break into the box (cut off the padlock) to turn it back on.

Every month he went to Court to have me evicted. I'd lose a day's work, show up, they'd call his case, he'd ask to have it dismissed. First time I didn't show up he got an eviction writ by default. I fought him for a while until I found a better place, but damn, what a jerk.

Shoulda shot him when I had the chance...


Attila the Mom said...

Fabulous analysis!

When Hubby and I were living in sin, we rented out both of our homes and lived in a condo that was closer to work.

Never ever ever ever again. Evah! The jackass in my house pulled up the new carpets, threw them out on the side of the house to get rained on and painted the hardwood floors red.

The jackass in his house broke into Hubby's storage space and used the glass and frame of a rare antique print to cut an enormous amount of cocaine on (chunks were stuck in the frame and residue was all over everything). gak

g bro said...

Man, you really touched a nerve! The comments are almost as long as the post. My rental experience has been limited - these past 3 months are the only time I've spent in a complex since 1974 - duplexes until 1996, our own house since then. Personally, I am glad to know that the person next door has a credit history and a job. Call me classist, I don't care.

phlegmfatale said...

thud - One certainly learns quickly to keep the B/S at arm's length. Else you'd never have a moment's peace.

lainy - It's no small feat on the best of days.

myron -I wondered if they were grinding an ax, too. They doth protest much.

speaker - glad you got out of there. Trust me when I say I learned how NOT to manage from someone this company used a couple managers back - she was beneath ineffectual-- she was uncommunicative, uncaring and unresponsive. When I got this job, I felt it was my opportunity to do things they way they should be done.

rabbit - Hardass is the only way to go with a most aspects of the job

dirtcrashr - It's an uphill battle - trying to keep a place decent when others are determined to trash it. Best of luck to your friends. And here's to owning things on a less grand scale-- more easily maintained.

hammer - When I have to raise rates on tenants, especially long-term tenants, I refuse to do a big hike 2 years in a row. I am at a phase in which I HAVE to raise everyone's rent, so if someone got a big hike last year, they're only getting a $5 or $10 increase from me this time. I think people need to be given a break if they've been a faithful tenant for a long time.

dedicated dad - You should have been notified someone was coming to inspect the property. This guy was obviously an heinous dirtball and an absolute reprobate to have treated potential clients in such a way. Yes, the world would have been better had you shot him the first time. Glad you moved on, though - he didn't deserve your money.

attila the mom - terrible experience. Renting out one's home is a path fraught with pitfalls and nightmares. It's worth paying a full months' rent to a management company to oversee the leasing/management of same. They'll do the screening, etc. You have to have a lot of nerve and determination to hold people accountable. Some really great renters are out there, but there are a lot of bad ones, too.

g bro - Me too - I like the idea of communities with a high deposit (i.e., one full month) - that way, everyone has something on the line to keep them on best behaviour (mostly)

Anonymous said...

If Wonder Weenie, Cub Reporter, thinks that renting in the average market is an invasive and degrading pain, he/she should try doing it in a city that has the kind of Rent Control and Tenant Protection laws that he/she obviously believes in.

While I've never done it myself (I suffer from OTHER sorts of insanity), I have for years observed and talked to people who - for various reasons- rented in New York City.


High rents, grey market or black market rentals due to regulations (I knew a guy who lived, and payed 'rent' for years in a condemned building), under-the-table fees taken for granted......