Wow - Landlords Gone WILD!

[tryan]

This is how silly/dangerous things can get when FOOLs over pay for a rent controlled building -

The charges stem from tactics the Macys allegedly used after they bought a six-unit, three-story apartment building on Clementina Street for $995,000 in 2005 and started eviction proceedings against the five tenants living there.

When one of the tenants, Scott Morrow, successfully fought eviction, the couple allegedly told workers in September 2006 to cut the beams that supported his apartment's floor. They also shut off Morrow's electricity, cut his phone line and had workers saw a hole in his living room floor from below, prosecutors said. Morrow has since sued the Macys.


The couple were also charged with terrorizing two other tenants in the building who began paying the Macys reduced rent after concluding that they were being overcharged under the city's rent control law.

S.F. landlords charged with tenant terror

 

[RunningBum]

Is there any truth to the rumor that the landlord was heard muttering "4% appreciation my *ss"?

 

[honobob]

Is there any truth to the rumor that the landlord was heard muttering "4% appreciation my *ss"?

Actually this is a case of where the normal 11%+ appreciation in SFBay can be greatly enhanced. Since rent controlled buildings are sold at a value based on actual rents and property taxes are based on that lower figure if the tenants appear to possibly be short timers (read elderly or sick) the new buyer has a chance of literally doubling his value in a very short time and retaining the low tax base.

I think the Macys may have been transplanted East Coast landlords looking for the quick "cash flow" instead of the steady 11%+ appeciation.

 

[ERD50]

weird. Probably both of the owners have mental issues, but I gotta wonder if they are not upside-down on that mortgage, so they don't care if they cut the beams, etc? They are just trying to bleed it for any cash flow they can?

Can you imagine coming home to 'dismantled furniture'? Oh the horror! Maybe the strangeness of that is what makes it so scary?

On a related note - I must remind myself to make a list of cities with 'rent controls', if/when I decide to relocate. That is just bizarre, IMO. Why should the govt be getting into people's lives to that degree? What's wrong with a free market in rent?

-ERD50

 

[W2R]

On a related note - I must remind myself to make a list of cities with 'rent controls', if/when I decide to relocate. That is just bizarre, IMO. Why should the govt be getting into people's lives to that degree? What's wrong with a free market in rent?

Nothing at all. Besides, if I can't afford to rent there via the free market, why would I want to live there? Either I would be paying an unaffordable rent (or purchase price), or I would be severely limited in my choice of residence. Sounds like large quantities of misery and bureaucracy all around.

The Macys were certainly creative. Changing the locks, dismantling the furniture, and then pouring ammonia on their tenants' clothing and electronics? I have had bad landlords in my youth, but never that bad.

 

[RunningBum]

I guess the argument on rent control is that you want teachers, fire fighters, etc, to be able to live in your community, right? I'm not saying it's the correct answer, but I think some places don't have the patience to let the market determine rent, and that if the schools can't find enough teachers then real estate there is less valuable.

 

[RunningBum]

Maybe I shouldn't have replied, because I'm sure it's a lot more complicated than that, and I've never been a landlord or lived in a city with rent control and I haven't given it much thought. But I don't think it was done just for the hell of it. So I'll leave my post and others can give better answers.

 

[ERD50]

and that if the schools can't find enough teachers then real estate there is less valuable.

which in turn results in lower rents, and ....

That's the beauty of the free market and the 'invisible hand' - these things self-correct. Bureaucrats are seldom* as effective as the laws of economics.

-ERD50

* bureaucrats are needed when the 'true cost' of an item is not reflected in it's price - for example, the damage from the pollution emitted by cars was not in the price of the car. So it took federal regulations to dictate pollution controls. There is a time and a place, but it should be restricted to the areas where the free market does not reflect the 'true cost'. IMO.

 

[tryan]

Actually this is a case of where the normal 11%+ appreciation in SFBay can be greatly enhanced.

Of course, if you're hemoraging $10k/month ... chasing the fairy's gold (11% appreciation) is a mute point.

These fools (owners) are obviously VERY desperate for a reason - they're triing to stop the bleeding.

 

[CuppaJoe]

My landlord's spokeperson describes buying a rent-controlled building as similar to going into the desert, you know it's going to be hot.

edited to add a quote from Wikipedia, with my landlord's company name changed to "my landlord" I believe the buildings are deep within REIT-style deals:

"Shaky finances
[my landlord] has bought buildings on credit from outside investors, with down payments as low as 8% of the total purchase price (as opposed to 30-40%, which is more common for comparable commercial real estate purchases). Because of the high prices paid for buildings, and the high amount financed, this means the buildings have negative cash flow and cannot support their mortgage. Critics complain that in the event of a market downturn or other unexpected event, [my landlord] may default on its mortgages and have to sell them at distressed prices or in foreclosure, which would have a ripple effect that depresses commercial real estate throughout San Francisco."

 

[Texarkandy]

I guess the argument on rent control is that you want teachers, fire fighters, etc, to be able to live in your community, right? .....

Then perhaps "those" communities need to pay their teachers, firefighters, etc. more if they want them to live in the same community.

 

[Khan]

Then perhaps "those" communities need to pay their teachers, firefighters, etc. more if they want them to live in the same community.

Without raising taxes?

 

[Walt34]

Without raising taxes?

You get what you pay for.

 

[Texarkandy]

I guess the argument on rent control is that you want teachers, fire fighters, etc, to be able to live in your community, right? I'm not saying it's the correct answer, but I think some places don't have the patience to let the market determine rent, and that if the schools can't find enough teachers then real estate there is less valuable.

Then perhaps "those" communities need to pay their teachers, firefighters, etc. more if they want them to live in the same community.

Without raising taxes?

Teachers & firefighters do ok in my community - we have a moderate property tax (high compared to some) & no state income tax. All things considered, I don't mind the property tax although I do think the State & local school district could manage the money better.

My point is - if a community with very high priced housing (SFR for example) wants their public school teachers & firefighters to live within that community, then they need to make this possible via compensation that allows them to obtain suitable local housing - if that requires increased local taxes, that is a choice for that community to make.

The community, however, has no business socializing the rental units that belong to private persons & companies with "rent controls".

An alternative solution might be for the school district and city to provide housing supplements to the teachers & firefighters - but then that is a local decision.

If taxes need to be raised to increase teacher/firefighter salaries or provide supplements so they can afford live in the high-priced community it can be voted upon - then we'll see how much the locals really care if their teachers & firefighters live locally when it's coming out of their pocketbooks rather than the landlords.

If this is the goal, why put it on the backs of landlords.

 

[Walt34]

And to think I complained to the apartment management when the hot water didn't work three or four times a year. I didn't know how good I had it.

 

[haha]

If taxes need to be raised to increase teacher/firefighter salaries or provide supplements so they can afford live in the high-priced community it can be voted upon - then we'll see how much the locals really care if their teachers & firefighters live locally when it's coming out of their pocketbooks rather than the landlords.

If this is the goal, why put it on the backs of landlords.

I think it is because there are many taxpayer voters, but relatively few landlord voters. When pols set out to steal from someone, they are usually pretty good at picking out the vulnerable victims.

Ha

 

[Texarkandy]

I think it is because there are many taxpayer voters, but relatively few landlord voters. When pols set out to steal from someone, they are usually pretty good at picking out the vulnerable victims.

Ha

All the more reason not everyone should be allowed to vote IMO -

or perhaps some folks votes should count more than others, which BTW seems to be the theory of the Democratic party

 

[mathjak107]

i own apartments over looking central park in nyc that are rent stabilized. let me start by saying rent controlled and rent stabilization have nothing to do with income... all it means is the person has lived in a building for a long time qualifying them for special reduced rates. income is not a factor. it all depends if you moved in prior to certain dates..period.

sorry the pictures of grand mothers living on social security are not the deal.....

soooo the lucky few who live in a building get a lower rent then everyone else who pays way more.,... yes way more because there hasnt been a rental building built in ny or the boroughs in 30 years. they all are co-ops or condos as no landlord wants to deal with this crap.

people in these rent controlled apartments play games trying to pass them on to others at the same rate claiming they live there too.

on the flip side my wife and i live in a rent stabilized building because my wife has been there 25 years. even though we get a lower rent then everyone else its still bull crap. its all smoke and mirrors and the idiots of our city think its a good thing even though it drives up everyone elses rent.

 

[mathjak107]

as far as getting tenents out... well most leases contain a clause about you can be evicted for modifications to the apartment. if so much as a light fixture has been changed you can start eviction preceedings.

a ploy of the unethical landlords is to wait until something breaks. dont respond to fixing it and hope the tenant goes out and buys a new faucet or new light fixture. bingo got em...

the tenant has to really go to tenant court first and get a court order to fix the issue on their own before doing it when a landlords unresponsive. since no one does that a landlord can start eviction

 

[mathjak107]

what i cant figure out is why in no other walks of life or business does anyone come in and tell you how much you can charge for your business or services and then tell you that you have to subsidize the person who shouldnt even be living in your building if they cant afford it. only in real estate do we see this bull.

when you go to buy food do you tell the grocer i im only giving you a dollar for that quart of milk so you pay for my milk out of your own pocket.

our apartments which are valued between 1 and 2 million should be getting around 4,000-5,000 a month rent. our highest rent stabilized tenant pays 2100. its less than costs at this point.

we have a standing offer of 50,000 bucks to anyone who moves out. we had 5 out of 9 tenants take the offer but so far we have 4 who are staying.

if you think i have alot to say about this nonsense i sure do..... ill contain myself for now

 

[mathjak107]

i got an idea, if the state or city wants subsidized housing let them build it.!.