Rental Housing Journal Metro December 2015 by Professional Publishing, Inc

Rental Housing Journal Metro

December 2015

3. Credit Screening 4. Portland Apartment Research Report 5. President’s Message – Our Fast Paced World

6. How to Dodge a Tax Hit When Selling Rental Property

11. Ask the Secret Shopper – ‘Tis The Season to be Jolly

7. President’s Message – Gratitude & Appreciation

12. Historic Lending Discrimination Settlement Addresses Allegations of Modern Day Redlining

10. Flipping Edges Out Renting As The Preferred Investing Strategy

Portland/Vancouver

www.rentalhousingjournal.com • Professional Publishing, Inc

Published in association with: METRO Multi-Family Housing Association; Rental Housing Association of Oregon; IREM & Clark County Association

The Top Amenity Trend in 2016 for Today’s Tech-Savvy Residents:

3Q15 Market Overview

Property-Wide WiFi

Multifamily Housing Update

Part I of III

By Eric Markow

Portland, OR Payroll Job Summary Total Payrolls 1 Annual Change RCR FY15 Forecast RCR 2016 Forecast RCR 2017 Forecast RCR 2018 Forecast RCR 2019 Forecast Unemployment (NSA)

,115.9m 39.5m (3.7%) 35.7m (3.3%) 28.1m (2.5%) 30.6m (2.7%) 30.6m (2.6%) 24.8m (2.1%) 5.2% (Sept.)

3Q15 Payroll Trends and Forecast Portland employers found another gear during the summer quarter, hiring at a 18year high 39,500-job, 3.7% year-on-year rate, up from 2Q’s strong 33,000 (3.1%) job performance. Faster hiring in the construction and services sectors was largely responsible for the surge as the foregoing sectors hired at a collective 21,700-job, 4.1% pace, up from 15,600 (3.0%) in 2Q15. Notably, manufacturing head counts continued to rise at a vigorous rate, especially in the transportation equipment industry, which is benefiting from strong foreign and domestic demand for trucks, aircraft and rolling stock. Subsector payrolls increased at an 11.7% y-o-y rate, representing the third consecutive quarter of double-digit growth. Seasonally adjusted data also were strong, recording a net gain of 10,800 jobs July to September, the best quarter since 2005. The period ended on a sour note, however, as workers lost a net of -1,300 jobs in September, the weakest month posted since July 2010. RED Research specified a Portland payroll forecasting equation using current and lagged U.S. payroll growth and lagged ...continued on page 12 Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

ith widespread technology use by residents of all ages and the rise of the Millennial generation, property-wide WiFi, Gigabit speeds, WiFi calling, and smart home features are what’s next in technology trends for apartments in 2016. Rental properties have to provide the technology amenities the market demands, starting with highspeed, reliable internet service. Apartment living is evolving because of shifting population dynamics. With 77 million tech-savvy Millennials (ages 18-36) entering the apartment market, they are transforming the demand for technology-oriented amenities in both private and shared residential spaces. It’s not hard to see why Internet is the No. 1 desired technology-based amenity today. In addition to attracting droves of new residents, new

technologies actually have the potential of opening up untapped ancillary income for owners. High speed access to the internet for information and entertainment is an integral part of the lives of more and more Americans, but especially the millennials who grew up with such services. Dense,

bandwidth intensive content such as YouTube videos, movies, and video games is a given for this market. Millennials want to stay connected on their devices anywhere for social media and real-time interactions on platforms like Twitter and ...continued on page 9

Vancouver, Washington Ordinances Protecting Vulnerable Renters

By Heather Hill, Bluestone & Hockley Real Estate Services

hile the ordinance passed by the city of Portland on October 14 requiring 90-day notices for PRSRT STD US Postage PAID Portland, OR Permit #5460

no cause evictions and rent increases over 5% in a 12 month period gained attention across the region, a similar ordinance en-

acted a month prior in Portland’s sister city Vancouver, Washington may have served as a catalyst. The Vancouver City Council unanimously approved three ordinances on September 21 aimed to protect a low income population they term as “Vulnerable Renters.” The first ordinance, VMC 8.45, prevents landlords from denying an application for rent based on a renter’s source of income, specifically federal and state public benefits or rent subsidies. Oregon Landlord Tenant Law already includes this renter protection. ...continued on page 17

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Rental Housing Journal Metro

Credit Screening

By Jo Becker Education/Outreach Specialist Fair Housing Council of Oregon

teria. The list has been recently updated and is posted at http://www.fhco.org/discrimination-in-Oregon/protected-classes/national-origin/alternative-suggested-documents. This article brought to you by the Fair Housing Council; a civil rights organization. All rights reserved © 2015. Write jbecker@FHCO.org to reprint articles or inquire about ongoing content for your own publication.

t is a common practice for housing providers to screen applicants based on credit score and credit history. From a fair housing perspective, providers can decide how to set their credit criteria as long as they apply it consistently regardless of the protected class status of the applicant. Recently, I receive a call from a landlord who wanted to know how he could apply an exception to the FICO score requirement he has without running afoul of fair housing laws. He wanted to make an exception if a low credit rating is tied to high medical bills2. This is a generous (and, frankly, realistic) consideration, given that the number one cause of bankruptcies in this country are due to unpaid medical bills, outpacing those caused by credit-card bills or unpaid mortgages, according to an CNBC article (http://www. cnbc.com/id/100840148). Reportedly, having health insurance doesn’t buffer many from such financial hardship. If housing providers decide to have exceptions to their screening criteria, the policy includes an explanation of when exceptions would be made. A common exception is for applicants with screening barriers who have completed an approved tenant education program such as Rent Well, Second Chance, or Moving Forward. So the gentleman who called me may require a FICO score of “X” as a general rule, but he could have a policy explaining he would make an exception if there is documentation to verify the lower score was caused by medical bills2.

POOR Of course, he would need to make that exception consistently, regardless of protected class. One area of screening that is confusing to some housing providers is how to screen an applicant without a Social Security number. First of all, it’s important to know that fair housing protections apply to everyone in the US, regardless of immigration status (for more on this read FHCO’s previous article on the matter at http://www.fhco.org/news/read-on view=category&id=81 http://www.fhco. org/news/read-on view=category&id=81. A policy requiring Social Security numbers in all cases probably has a disparate impact on immigrants and falls under the “national origin” protected class under fair housing law. You should know that a Social Security number isn’t the only way that credit bureaus identify us. The bureaus use personal information including full name, date of birth, and addresses, to compile individual credit reports. While, in some cases, having a Social Security number

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GOOD may increase the accuracy of the bureau’s matching process, it is not necessarily essential in running a credit check. FHCO participated in a work group convened by the Credit Builders Alliance due to growing concerns from both housing providers and consumers about credit screening issues. One of the products that came out of this work group is a Tip Sheet on Building Credit Without a Social Security number which can be found at the Alliance’s website at “http:// creditbuildersalliance.org/sites/default/ fi les/Building%20Credit%20without%20 a%20SSN.pdf” http://creditbuildersalliance.org/sites/default/fi les/Building%20 Credit%20without%20a%20SSN.pdf. The Tip Sheet addresses issues of concern to both housing consumers and providers, including using consistent information when interacting with credit bureaus and properly transferring credit history to a new Social Security number. It contains a list of best practices for consumers and businesses, as well as explaining the use of other identifying numbers, such as the ITIN, and how they can be used to pull a credit report? Do take a close look at the Tip Sheet on the Credit Builders Alliance site and remember, too, that FHCO offers a list of suggested alternative documents that can be used to verify identity, bill payment history, and other relevant screening cri-

To learn more… Learn more about fair housing and / or sign up for our free, periodic newsletter at www.FHCO.org. Qs about this article? ‘Interested in articles for your company or trade association? Contact Jo Becker at jbecker@ FHCO.org or 800/424-3247 Ext. 150 Want to schedule an in-oﬃce fair housing training program or speaker for corporate or association functions? Visit www.FHCO.org/learning-resources/ trainings to learn about the trainings we offer for companies and groups. Federally protected classes under the Fair Housing Act include: race, color, national origin, religion, sex, familial status (children), and disability. Oregon law also protects marital status, source of income, sexual orientation, and domestic violence survivors. Additional protected classes have been added in particular geographic areas; visit FHCO.org/mission.htm and read the section entitled “View Local Protected Classes” for more information. 2 This example was this particular landlord’s preference to oﬀer; however, this is one example of a reasonable accommodation request an individual with a disability might request of any housing provider. Regardless of screening criteria, all housing providers are always required to consider reasonable accommodation and modifications requests. To learn how reasonableness is determined and learn more about disability-related protections visit http:// www.fh co.org/learning-resources/downloads/category/3-guides?download=193:resource-guide-2015.

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Rental Housing Journal Metro

Portland Apartment Research Report

Portland Metro Area, Fourth Quarter 2015

ew Portland Apartments Sprout Amid Flood of Demand Employers in the growing tech hub of Portland are expanding headcounts, generating new homeownership and apartment demand. An ever-increasing number of companies call the area home. This year Google will be moving into its first downtown location, adding to the slew of technology startups and businesses nearby. These higher-wage jobs are drawing residents to the area’s live-work-play neighborhoods. To meet the rising need for housing, developers are expanding geographic parameters for where they will build, as land restrictions encourage vertical growth in the core vs. greater flexibility in the suburbs. This

will bring another year of elevated construction. Developers are constructing a majority of new units in the core and just to the east and west of downtown, some with shrinking floorplans that have yet to deter potential residents. Yet, local apartment stock hasn’t kept pace with the need for rentals, trimming the metro’s vacancy rate well below traditional replacement levels. Flourishing demand will continue to tighten this year, supporting further effective rent increases as the number of units available for lease dwindles. Tightening operations in Portland’s apartment inventory draw investors. In the recent 12-month period, institutions targeted stabilized product in the western core, which includes downtown, earning

first-year yields in the 5 percent area. California buyers also sought the stability of Class A assets located downtown and beyond where yields can range from sub-5 to the 6 percent range. Individual buyers concentrated on value-add opportunities, making purchasing decisions based on potential rents after renovations and full occupancy, with prices reflecting these prospective gains. In such a tight investment market, local apartment investors are moving to outlying suburbs, seeking cash flow vs. appreciation. They traded into properties at cap rates in the mid-6 to mid-7 percent range. A lack of listings and an influx of capital will continue to boost interest in the metro’s apartment assets.

How much does the job pay?

2015 Annual Apartment Forecast Employment: After expanding employment by 31,000 positions last year, employers will generate 34,000 jobs in 2015, a gain of 3.1 percent. Staﬃng in the professional and business services sector will be sizable. Construction: New households in the Portland metro will support the addition of 4,100 rentals in 2015, after the completion of 4,300 units in 2014. Demand will remain strong metrowide, with some residents seeking available apartments farther from the core. Vacancy: A large number of units being delivered through the end of the year will push vacancy up 10 basis points to 2.7 percent in 2015 on net absorption of nearly 3,800 units. Last year vacancy fell 70 basis points to 2.6 percent. Rents: Newer luxury apartment stock combined with tightening vacancy is expanding rental rates metrowide and especially near tech employers in the core. As demand rises and concessions wane, average effective rent for Portland apartments will increase 16.8 percent in 2015 to $1,200 per month. Last year rent rose 6.6 percent year over year. Published courtesy of Marcus & Millichap

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President: John Sage • President Elect: Ron Garcia | Past President: Elizabeth Carpenter Secretary: Lynne Whitney | Treasurer: Elaine Elsea | Office Manager: Cari Pierce

Our Fast Paced World

John Sage, RHA Oregon President

hings move pretty fast in our world today. Something happens across town or a globe away and we hear about it almost instantly. Events shaping our world are available via our phones, internet, or TV for instant viewing. We can check up on changing opinions on Facebook, Twitter and a myriad of other sites. Does all this information or misinformation help us to have better understanding of the issues of today? Does this information/misinformation lead to better decisions for our future? There is a certain secure feeling about having the time to think through an issue and trying to see all sides before coming to a conclusion. Is this something that we are allowed to do today, with the speed at which information comes to us and at us these days? Comedian Steven Wright asked the question “If your car is moving at the speed of light, do your head lights work?” This makes me wonder, if decisions are made at the speed of changing opinions. Does this work for long range planning? Well myself, I think that this is something that we will have to decide when we look back on this period in our history. There was a time in the past when I was a tenant, that I can remember seeing signs on the sides of apartment complexes throughout the Portland Metro area. These signs advertised reduced move in costs, first month’s rent free, and many other inducements to tenants to get them to move to a new location. Why would

the property owners do that? Well, at the time there were more units available than there were tenants wanting units. Rents were lower due to competition for tenants. Life was good if you were a good tenant and wanted to move to a bigger unit with more amenities. That was only a few short years ago. Does anyone else remember those times? Hard times to be a property owner!! Where was the federal or local government then? Did they subsidize our businesses while we were struggling? Was there a “Landlord Crisis” declared? Did they change the rules on tenants and make them give us 90 days’ notice for moving out? Did we have to give them 90 days’ notice to give them a reduction in rent to induce them to stay in the unit? You all know the answer. We were on our own to get by the best that we could. Struggling to maintain properties with lower income and some empty units. I’m not bringing this up to whine

Rental Housing Journal Metro · December 2015

or complain but to illustrate that things change; it is the circle that life seems to always move in. There will be times of feast and times of famine. It is during both times that we need to band together as property owners. The State Legislature will be having a short session starting in February 2016. There will be bills put forth that will again effect our industry. Our Lobbyist Cindy Robert is already working to keep RHA Oregon members and board informed of the proposed bills being put forth by committee and individual legislators. Since 1927, RHA Oregon has set the standard for community participation by landlords providing affordable and quality housing. You have all seen this statement on our website. Did we just create it in a vacuum? No; since I have been involved with RHA Oregon I have seen that our members live this statement. They are involved with working in the community to improve the

10520 NE Weidler, Portland, OR 97220 (503) 254-4723 • Fax (503) 254-4821 info@rhaoregon.com • www.rhaoregon.org

lives of others: Helping out with feeding and clothing the homeless and reaching out to others in need. Now is the time for us to come together and work for our industry. Let’s make our voices heard in the halls of the City Councils throughout Oregon. We have already gotten the ball rolling. First, Vice President Phil Owen and Lobbyist Cindy Robert testified recently in Salem before the Housing Committee about housing. Then Phil and I were interviewed separately by KGW channel 8 about the recent changes made by the City of Portland. So I urge each and every one to get involved. Watch your emails for updates as to proposed changes and or bills from the legislature. Attend meetings on the issues, emails will be sent out concerning the time and dates. As always it is a privilege to serve as President of RHA Oregon. I am proud to be involved with an organization that represents the best of our industry. Sincerely, John Sage President RHA Oregon Stegmann Insurance Agency Inc.

...continued on page 9

Rental Housing Journal Metro

How To Dodge A Tax Hit When Selling Rental Property

By making the right move, sellers can sidestep the Capital Gains Tax

he life of a landlord certainly isn’t easy. There are plumbing issues that eat into time and money. There are tenants who fail to pay the rent. There are broken leases and leaky roofs. And the hassles don’t even end when the beleaguered landlord finally decides to sell the property. After the deal closes, the Internal Revenue Service is waiting in the wings to collect a capital gains tax on the profits from the sale. “Depending on your situation that can definitely end up being a significant hit when tax time arrives,” says Dwight Kay, founder and CEO of Kay Properties and Investments (www.kpi1031.com). But Kay says with the right planning those landlords – and anyone who sells commercial property – can sidestep paying the capital gains tax. Here’s how: When they sell their property, they can invest the proceeds in what is referred to as “like-kind” property using Section 1031 of the Internal Revenue Code. Essentially, they are exchanging one piece of commercial property for another, but hopefully one that better meets their needs, Kay says. “A landlord who decides he’s tired of all the work he has to put in on his rental property could use the exchange to get an

income-producing property where someone else is dealing with all the problems,” he says. All types of commercial properties can be considered “like-kind,” including apartment buildings, vacant land, farmland, oﬃce buildings and warehouses among other properties.

Also, despite the name, the property doesn’t have to be in Delaware. Kay, for example, says his Los Angeles and New York City-based company works with clients and properties in all 50 states. Kay goes on to say, “A Delaware Statutory Trust property could be a property that has a long term lease with Costco or Walgreens or it could be a 200 unit apartment community built in 2014 and located in Denver, Colorado. Investors are able to invest as little as $100,000 into each DST thereby creating a diversified portfolio for there 1031 exchange.”

One drawback is that the seller has just 45 days to identify what property they are going to exchange into. It’s not always easy to find 1031 exchanges quickly, but there’s also a solution to that, Kay says. Kay says there a several potential If the seller qualifies as an accredited investor, which is generally defined as an investor with a net worth of greater than $1 million dollars excluding their primary residence, the seller can potentially invest in Delaware Statutory Trust properties. A Delaware Statutory Trust (DST) is a trust that lets investors buy an interest in commercial property, but managing the property is left to professional asset managers. Because Delaware Statutory Trust properties are pre-packaged for 1031 exchange investors, they provide a viable solution for those concerned about meeting that 45-day deadline.

benefits for investors. Here are just a few:

• Eliminating the day-to-day headaches of property management. The Delaware Statutory Trust 1031 property provides a passive ownership structure, allowing the investor to enjoy retirement, grandkids, travel and leisure, as well as to focus on other things that they are more passionate about instead of property management.

have under-market rents or multiple vacancies. It could be that they have raw or vacant land that is sitting idle. These Delaware Statutory Trust exchange properties provide an opportunity for investors to potentially increase their cash flow on their real estate holdings. • Portfolio diversification. Often times, 1031 investors are selling a property that comprises a substantial amount of their net worth. They want to reduce their potential risk and instead of buying one property they decide that investing into a diversified portfolio of Delaware State Trust properties is a better fit for their goals and objectives. About Dwight Kay

ON-SITE-NW SEA

Dwight Kay, founder and CEO of Kay Properties and Investments, LLC (KPI) (http://www.kpi1031. com/www.kpi1031.com), is a Series 7, 22 and 63 licensed, Registered Representative and Real Estate Professional. His firm, Kay Properties and Investments, specializes in Delaware Statutory Trust (DST) brokerage and advisory services. Kay Properties and Investments currently has offices in Los Angeles as well as in New York City and offers securities through Colorado Financial Service Corporation, Member FINRA/SIPC. Kay Properties and Investments, LLC and Colorado Financial Service Corporation are separate entities. OSJ Address: 304 Inverness Way S, Ste 355, Centennial, Colorado.

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Gratitude & Appreciation

s I compose this final message as your 2015 Multifamily NW Board President I reflect upon how quickly the last twelve months have passed. It has been an honor to be aﬃliated with the board directors, planning committees, the association in general -and all it represents. The membership driven component of this group truly helps establish its success as a recognized leader among rental housing associations. Effectiveness is only as strong as the strength and integrity of its members. Multifamily NW is a formidable association. I also reflect upon significant change. For the past twenty-four years I have been a part of an industry that has evolved on multiple levels- marketing, communications, technology, revenue management, maintenance, and more. Although the tools are ever changing and improving, we cannot lose sight of the fact that we are a service industry. As such, our primary focus is singular in objective: serving people. Following this basic premise, the Multifamily Housing Association was started in 1993 by a handful of local professionals who wisely identified the need for education to establish, promote and maintain professionalism in the rental housing industry. The idea proved a fast success as many soon realized the benefits of aﬃ liation. Membership grew quickly. The association started with 65 members. Fast forward twenty-two years -and sporting a new name (Multifamily NW)- current

Publisher Will Johnson – will@propubinc.com Designer/Editor Kristin Flores – kristin@propubinc.com

numbers reflect 1,524 property management and rental home owners (companies and properties) and 212 industry suppliers! Over time the association expanded the membership footprint across the northwest – Portland, southwest Washington, south through the Willamette Valley to Medford, and central Oregon. Multifamily NW has become synonymous with a few annual events provided through the association. These programs have helped establish the entity as the prominent regional organization it has become today. These are events that recognize and promote talent, provide substantial networking opportunities, further professionalism through education, and simply enhance the perception of the multifamily industry. Events such as the Maintenance Fair, ACE Awards, the Portland Charity Golf, Spectrum Educational Conference and Trade show and Reverse Trade Show and more - have all placed the association on the regional map and established its reputation as a promoter of education, professional development and industry advancement. The annual Apartment Report is now recognized on a national level and cited by numerous industry professionals across the country. None of these events would be possible without the coordination, dedication and drive of the Multifamily NW staff. Recognition is much deserved and I wish to personally thank each and recognize them in this message: Kristen Davies: Director of Operations and Events; Jonathan Clay: Research and Communications; Mac Bergin: Member

Advertising Sales Will Johnson – will@propubinc.com Terry Hokenson – terry@propubinc.com Larry Surratt – larry@propubinc.com

Services; Ashley Carrico Rogers: Education Coordinator; Tryna Hermanson: Accounting; Natalie Osorio: Administrative Assistant; and Cory Vieira: HR generalist. Each of these people is an integral member of a team that consistently strives for the best in performance and results. Their daily “behind the scenes” efforts are key to the forward progress and momentum of the association. It has been a pleasure working with them and their efforts are greatly appreciated. The leadership provided by Executive Director Deborah Imse is the rudder that steers this ship. I have witnessed the passion, tenacity and work ethic of this amazing individual. Her business acumen has helped produce the financially strong and highly respected association that Multifamily NW is today. It has been a privilege to serve the association with her this past year. My sincere gratitude and appreciation go out to the 2015 Executive Council. The collective input of Dave Bachman, Jeff Edinger, Chris Hermanski and past president Pam McKenna helped successfully navigate us through the complexities of many issues this year including Fair Housing and significant legislative issues proposed – all potentially impacting our daily business practices. The real estate legal landscape is becoming more complex as issues surrounding rent control and affordable housing become more prominent on the horizon. The need for sound leadership and balanced decision-making is critical.

Thank you to the 2015 Board of Directors. The dedication and commitment of each of these sixteen individuals drives the momentum of the association. The combined experience of these respected property management professionals and industry suppliers provides the strong leadership platform needed for association guidance creative problem solving. It has been an honor to work with each of them. Our multifamily industry continues to grow and change exponentially and all at supersonic speed. Keeping pace with legislative changes, technical advancements, business practices, marketing tools, and a myriad of other “required reading “ is essential not only for success, but survival. The education, opportunities and support provided by Multifamily NW Association builds, nourishes and sustains the professionalism of the property management field and is helping to usher in a new generation of industry professionals. Thanks to the inspiration and foresight of a few local professional back in 1993, thousands have benefitted from the formation and evolution of this association. I am grateful for the opportunity afforded and sincerely appreciates all who make Multifamily NW so successful. It has been a pleasure and privilege to serve and be a part of this amazing organization. Thank you! Best wishes to all for a happy holiday season and prosperous New Year! ...continued on page 13

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Rental Housing Journal Metro

Property-Wide WiFi ...continued from page 1

Snapchat. Mid-life residents (36-55) are also increasingly heavy technology users. With the growth of telecommuting, more workers are based at home and demand reliable Internet. And seniors aren’t far behind, as they want to use email, Netflix, and other websites, and Skype with their grandchildren. To keep up with this societal trend, more and more properties have discovered that technology amenities have become a critical part of the mix of offerings required to attract and retain residents, especially the swelling ranks of younger residents who grew up computer literate and social media savvy. Apartment hunting priorities for these residents still include affordable price and quality living conditions, but high-speed connectivity has risen to equal importance in and plays a key role in decision making. Most apartment hunters want to know they’ll have powerful and reliable internet connectivity, delivered wirelessly and with plug-and-play simplicity. Smart home features such as USB ports, and smart phone docking and charging stations round out the complement of technology offerings that will let residents know that your apartment com-

munity is the right fit for them. Whether building a new facility or upgrading existing buildings, including property-wide WiFi that offers high speed connectivity for both individual units and in common areas is a growing trend, and is proving to be a “win” for residents and owners/managers at properties around the country. New cutting edge technologies have finally made it easy and affordable to offer WiFi solutions at a high level.

Community Space Technology One of the major trends in apartment, MDU, and condo development in 2015 has been the focus on campus-like spaces, especially for urban communities where per-unit footprint has been shrinking. Designers and builders are creating more upscale lounges, club rooms, technology, fitness, business centers, media rooms, and play spaces so residents can gather socially while remaining connected to the Internet. Millennials in particular use these public spaces for socializing with other residents and guests, or as an extension of their own living space. Implementing the newest technology trends like property-wide WiFi and smart home

Rental Housing Journal Metro · December 2015

features allows residents to use these spaces as an extension of their home. Residents can print property wide, turn off their lights from anywhere, adjust their AC on the go, and much more. The perfect solution for a growing number of property owners has been to offer high-speed community-wide Internet service, which a recent survey by the National Multi Housing Council calls “one of the most desired amenities.” More than 70 percent of respondents said that fast, reliable broadband connectivity was either “important” or “very important” in their decision making. Increasingly, apartment communities are installing “bulk Wi-Fi” services and marketing this in-demand amenity as an option to create a new profit center. By eliminating the “big box” cable or DSL Internet companies from the equation, residents receive a superior service at a fraction of the market cost and MDU owners can establish a new revenue source

Modernizing In-Unit Technology Amenities To keep up with tech-savvy residents, modernizing rental units to include additional technology features are a key trend for 2016 and beyond. Simple steps like installing wall outlet covers with USB ports can be a great starting point. Adding the latest technology amenities converts quickly into increased revenue and retention. And while quality Internet service may not be the only factor in a resident’s choice to move in, your bad Internet service can definitely be a reason they choose a competing property.

Conclusion Of all the latest amenities that a property can include, technology access is becoming increasingly crucial in today’s competitive rental marketplace. Highspeed Internet service options that extend from apartment units to community spaces can help set you apart, and don’t have to be an expensive solution to implement; in fact they can bring you untapped profit opportunities. If done right, Property-Wide WiFi, amongst other technologies, are a distinguishing factor for resident loyalty, retention and increased per door revenue. Look for Part II of this three-part Property-Wide WiFi series on in the January issue of RHJ, which will delve more into specific Internet technology options and provide a “how to” on selecting the best community WiFi provider and installer for your property to ensure successful deployment. Part III, appearing in February, will address how to package and market property-wide WiFi and technology amenities to maximize your attraction, retention, and revenue. Eric Markow is Chief Technology Officer of Dual Path, a provider of high speed property-wide WiFi services. Dual Path’s customers include MDU and senior living communities who enjoy fast, reliable connectivity, delivered with old-fashioned customer service. Dual Path’s unique revenue generating model allows property owners to leverage their “Internet real estate” to maximize profits, increase resident satisfaction and retention, and increase property value. Headquartered in Phoenix, Arizona, Dual Path oﬀers property-wide WiFi, Gigabit Internet and WiFi calling solutions to properties and businesses coast to coast. For more information, visit www.dualpath. net or contact 1-800-468-6851.

Rental Housing Journal Metro

Flipping Edges Out Renting As The Preferred Investment Strategy For The Fourth Consecutive Quarter According To Auction.com Real Estate Investor Activity Report™

Price appreciation and inventory constraints continue to dictate investor strategy in the second half of 2015

uction.com, LLC, the nation’s leading online real estate marketplace, today announced the findings from its Third Quarter 2015 Real Estate Investor Activity Report™, a nationwide survey of real estate investors bidding on properties offered for auction during the respective period. Survey data collected from investors bidding on property online and at live events across the country reveals that flipping is still the preferred investment strategy among investors, edging out the hold-to-rent strategy for the fourth consecutive quarter – and since Auction.com began tracking the split in investor intent. “Rising prices and extremely limited inventory make a nearly ideal environment for real estate investors who want to buy, fi x and flip properties, and that is precisely where we are in today’s market,” said Auction.com Executive Vice President Rick Sharga. “But record occupancy rates in the rental market also present opportunities for investors who find moderately priced homes they can rent out at a reasonable rate of return, so it’s not surprising that we’re continuing to see buy-and-hold investing activity in the Midwest and Southeastern states.” Although Auction.com’s findings for the third quarter reveal a propensity toward flipping among investors overall, investor intent varies considerably by the type of auction (live event versus online auction) and investor profile. Survey respondents who indicated that they were making a one-time purchase clearly preferred a hold-to-rent strategy, while respondents identifying themselves as full-time “real estate investors” and those indicating that they were working on behalf of another investor strongly favored flipping.

Q3 2015 National Findings: Investor Intent Investor Profile One-time purchase Real Estate Investor Working on Behalf of Another Investor Total

Flip 27.8% 55.1% 67.6% 53.7%

Rent 68.7% 43.3% 31.9% 45.1%

Undecided 3.5% 1.1% 0.5% 1.2%

Investors bidding at live events appear to be far more likely to flip the properties they purchase based on survey responses collected in the third quarter of 2015, with respondents indicating a preference toward flipping over holding to rent in every state where Auction.com conducted live events.

Q3 2015 Live Event Investor Data: Intent of All Investors Surveyed State Arizona California Georgia Idaho North Carolina Nevada Tennessee Texas Washington Nationwide

Flip 59.8% 67.5% 53.2% 71.6% 54.9% 87.4% 69.5% 56% 73.8% 62.4%

Rent 40.2% 32.5% 46.8% 28.4% 45.1% 12.6% 30.5% 44% 26.2% 37.6%

Undecided 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

Conversely, responses given at online auctions in the third quarter of 2015 show that investors bidding online generally intend to hold the properties they purchase. This was true in every region except the Northeast, which experienced a swing toward flipping in the second quarter due to the region’s inventory constraints and higher purchase prices negatively impacting rental property returns.

continued on page 19

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Rental Housing Journal Metro · December 2015

Rental Housing Journal Metro

SK THE SECRET SHOPPER ‘Tis the season to be jol ly.

owever, for many it’s the season of added stress with the holidays barreling down, year end, wondering how you will ever meet next year’s income and expense goals, etc. All of these factors and MORE combine into the perfect storm for those who already struggle with keeping their emotions in check.

damage their apartments. It’s just the nature of the beast. “Keeping your cool” is not an option. It’s a character quality that is essential to your success in this business, and life in general. If you find yourself in the type of situation described above, please seek some wise counsel regarding your particular circumstances. If you are a person who has the tendency to take your anger and frustration out on the people you work with, then sign up for an anger management course or ask your co-workers to chip in and buy you a punching bag as a holiday gift!

While it may seem like the property management industry is about “managing properties,” it’s really about managing and caring for people. Regional and property supervisors are responsible for meeting the needs of their owners, and the staffs and residents of the communities they oversee. On site or resident managers are required to manage and care for their staffs, residents, prospective residents and vendors. This may not be a “news flash” for most of you. However, what may come as a surprise is that not everyone is treating those in their care with the utmost respect and consideration. This is a very “touchy” subject, yet one that still needs to be addressed based upon the following question:

Question I have a pretty good relationship with my property supervisor, but sometimes when a project isn’t done on time or the numbers just aren’t lining up, he yells and swears at me. I pretend his behavior doesn’t bother me and try to ignore it, but honestly I don’t know how much longer

I can put up with this. Not only do these outbursts hurt my feelings, but it’s so unprofessional that I am losing respect for my boss. What should I do?

Answer There is no room for verbal abuse in the workplace. It’s a form of harassment, and most companies have policies and procedures in place to protect their employees from this type of treatment. Yet, many people don’t speak up for these reasons: One, they’re afraid they will jeopardize their employment situation and/or experience some sort of retaliation. Secondly, the first time an episode of verbal abuse happens, the initial feeling is shock and

Rental Housing Journal Metro · December 2015

perhaps disbelief that it actually occurred. You may even try to convince yourself that it wasn’t so bad or that it was a one time, isolated incident that will “never happen again.” However, if someone loses control even once, he or she has the potential of losing control over and over again.

Remember This is a “people” business where every “person” deserves to be treated with respect and consideration; no matter what the circumstances. Property supervisors are going to continue to slash budgets, on site managers will at times overspend and miss deadlines, and certain residents are going to be late with rent payments and

Note Please don’t take your anger and frustration home with you either. - Your family deserves to be treated with respect and consideration too! If you are interested in leasing training or have a question or concern that you would like to see addressed, please reach out to me via e-mail. Otherwise, please contact Jancyn for your employee evaluation needs: www.jancyn.com Ask The Secret Shopper

Rental Housing Journal Metro

3Q15 Market Overview ...continued from page 1 values of S&P500 returns to achieve a 97.6% adjusted-R2 (S.E.=0.4%). The model projects strong growth through mid-2016, before weaker macroeconomic conditions lead to a mild slowdown. Annual net gains in the 25,000- to 30,000job range are the probable outcome. Occupancy Rate Summary Occupancy Rate (Reis) 96.0% RED 50 Rank 22nd Annual Chg. (Reis) -0.3% RCR YE15 Forecast 95.3% RCR YE16 Forecast 94.7% RCR YE17 Forecast 94.2% RCR YE18 Forecast 94.6% RCR YE19 Forecast 94.7%

3Q15 Absorption and Occupancy Rate Trends Tenant demand for apartment space weakened during the third quarter as renters leased a net of 628 units, according to Reis, down from 727 and 665 in the prior and year earlier quarters, respectively. By the same token, supply levels increased as the service added 1,135 units to the Portland inventory, giving rise to a -40 basis point sequential occupancy rate decline to 96.0%, the lowest rate observed in this market in nearly five years. Axiometrics surveys of 248 stabilized, professionally managed properties recorded a 96.2% average occupancy rate, up 30bps year-on-year. Class-C maintained a longstanding lead at 97.5%, followed by classes–B and -A at 96.1% and 95.5%, respectively. Northeast submarket enjoyed highest occupancy (97.5%), while amply supplied Northwest (95.6%) was the only submarket to record a metric be-

low 96%. Sixteen properties in lease-up absorbed an average of 12 units/month, up from 9 during 2Q15. RCR specified a 94.8% ARS (S.E.=0.4%) occupied stock growth model using payroll, rent, inventory and home price growth as independent variables. The model projects absorption of 3,302 units over the next five quarters, falling 1,715 units short of expected supply. As a result, occupancy is likely to decline 130 bps by YE16. Portland is likely to return to equilibrium in 2017, and recover in the out years. Effective Rent Summary Mean Rent (Reis) Annual Change RED 50 Rent Change Rank RCR YE15 Forecast RCR YE16 Forecast RCR YE17 Forecast RCR YE18 Forecast RCR YE19 Forecast

$991 7.1% 4th 7.3% 3.7% 2.7% 4.3% 4.0%

3Q15 Effective Rent Trends After upwardly revising rent growth over the past five quarters from an average of 4.4% to 5.2%, Reis report that the average effective rent of Portland apartments surged $29 (3.0%) sequentially during 3Q15 to $991. Expressed on a year-onyear basis, rents advanced 7.1%, the fourth fastest gain among the RED 50 and the largest annual increase ever posted in the 26-year Reis Portland data series. Axiometrics surveys of stabilized, samestore properties uncovered a stronger result. This service recorded 15.8% growth, up from 12.9% during the prior quarter and the strongest metric recorded in at

least eight years. Class-B properties enjoyed the fastest gains (17.0%), maintaining a lead that dates to 2012. Classes-A (14.6%) and C (12.1%) followed. Beaverton rents increased more than 20%, while East Gresham and Vancouver notched 18% increases. Only Northeast and Northwest failed to reach double-digits. RCR statistical analysis finds that metro payroll and home price growth and sequential vacancy change and Baa bond yields are significant predictors of Portland rent growth. The resulting 94.8% ARS (S.E.=0.6%) model foresees a gradual deceleration to the high-2% area by mid2017, followed by a rebound to 4% - 4.5% by 2H2018-2019. Trade & Return Summary $5mm+ / 80-unit+ Sales Approximate Proceeds Average Cap Rate (FNM) Average Price / Unit Expected Total Return RED 46 ETR Rank Risk-adjusted Index RED 46 RAI Rank

19 $655mm 5.1% $181,265, 6.8% 26th 5.78 14th

3Q15 Property Markets and Total Returns The Portland property market continued to gain momentum as 19 multifamily properties valued at $5 million or more exchanged hands during the third quarter, a likely record for this market. Aggregate proceeds were about $655mm, up 36% from 2Q’s strong $481mm performance. The increase was largely attributable to a move up in class by buyers, who concentrated increasingly on higher $/sf infill and class-A suburban product. As a re-

sult, the average price per exchanged unit metric increased 27% sequentially from $142,933 to $181,265, also a new record. Although infill trophy properties may trade to yields in the low-4% area, most class-B/B+ infill product commanded pricing equating to cap rates in the mid– to high-4% range. Class-B+ suburban properties were exchanged at going-in yields in the high-4%- to low-5%-ballpark, while class-B-/C product was available in the high 5%- to mid-6%-region. RCR elected to stick with 5.2% as our proxy B+/B asset cap rate. Using this purchase level, model derived rent and occupancy point estimates and a terminal cap rate of 6.1%, we estimate that a Portland investor would expect to achieve a 6.8% total rate of return on a five-year hold. Among the RED 46, this ranks 26th. Low model standard errors boost risk-adjusted returns, however; the metro’s 5.78 risk-adjusted Index ranks #14, ahead of Seattle (#20).

By Daniel J Hogan

Director of Research djhogan@redcapitalgroup.com 614-857-1416 Office 1-800-837-5100 Toll Free

...continued on page 15

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Rental Housing Journal Metro · December 2015

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Single Family Forms Single Family/Condo/Multiplex Rental Agreement M201 OR House Rules & Regulations M204 OR-WA Exterior Care Addendum M205 OR-WA Home Care Addendum M206 OR-WA

SAMPLE

ORIGINAL MOVE-IN DATE_________________________

CHANGES

DATE

tal Agreement related to this Rental Agreement. Failure to check the validate any cco-signer n agreements. box does not invalidate

Choice Voucher

PROPERTY NAME

c ne or more co co-signer agreements X Check if there are one

Section 8

c X Housing

c FILE X

PROPERTY #

SAMPLE

____________________________________________

COUNTY

RESIDENTS: (NAME ALL ADULTS)

CITY

_________

EMAIL SAMPLE ____________________________________________________________________

STATE

SAMPLE ______________________________________________________________

ADDRESS

MAIL

__________________________ ______________________________

_____

STATE

SAMPLE

c X MONTH-TO-MONTH BEGINNING:

SAMPLE

THAN FIRST):

MONTHLY STATED RENT SAMPLE

SAMPLE

OTHER SAMPLE

MONTHLY CHARGES

SAMPLE

OTHER SAMPLE

SAMPLE

OTHER SAMPLE

SAMPLE

OTHER SAMPLE

SAMPLE

OTHER SAMPLE

SAMPLE

TOTAL MONTHLY CHARGES L MONT

SAMPLE

_ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ __ __ ___ ___ ___ ___ ___ ___ ___ __ __ _ _______________________________________________________________________

___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ ___ __ ___ ___ ___ ___ ___ __ __ __ __ __ _ _______________________________________________________________________

DISHONORED D ON CHECK FEE

SMOKE ALARM/CARBON MONOXIDE ALARM SM

TOTAL DEPOSITS CHARGED

SAMPLE

DEPOSITS PAID

SAMPLE

BALANCE OF DEPOSITS OSITS DUE DU

SAMPLE

DEPOSITS

___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ _______________________________________________________________________

c X IF CHECKED, DEPOSITS WILL BE HELD BY OWNER

c X IF CHECKED, SEE SEC CHARGES/ADJUSTM

c X FREEZER

c X REFRIGERATOR

c X DEHUMIDIFIER

c X DISHWASHER

c X OTHER

_______________________________

c X STOVE

c X OTHER

_________________________________________

c X MICROWAVE

c X OTHER

___________

___

(FORM # M004 OR) OR

M035)

ES: ____

__________________ ___ __ ___ __ __ ___ __ __ __ ___ __ __ __ ___ __ __ __ __ _____ __

__________________ ___ __ __ __ ___ __ __ __ ___ __ __ __ ___ __ __ __ __ __

SAMPLE

____________

____________________________________________________ __ __ __ ___ __ __

_______________________________________________________

_____________________________________________________________________________________

_____

_______________________________________________________________________________

_____________________________________________________________________________________________________________________ __ __ __ ___ __ __ __ ___ __ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __

SAMPLE

_____________________________________________________________________________________________________________________ __ __ __ ___ __ __ __ ___ __ __ __ ___ __ ___ ___ ___ __

SAMPLE

________ _

NAME DATE ___________________________________________________

_______________________________________________________ ___ __ _ ______________________________________________________________

___

SAMPLE _ SAMPLE _______________________________________________________

OTHER OCCUPANTS

SAMPLE

TH’S ACCOU TING FOR ADDITIONAL ADDITION

SAMPLE

DISCLOSURES D

APPLIANCES

c X BARBECUE

c X DRYER

SAMPLE

____________________________

(SEE E #1 ON PAGE 2)

SPECIAL PROVISI

__________________ _

c X WASHER

SAMPLE

____________________________

c TED RENT E EVERY 5 DAYS X 5% OF STATED

PRO-RATE METHOD: c XA c XB c XC

___________________

OWNER/AGENT PROVIDES THE FOLLOWING APPLIANCES:

SAMPLE ___ __ ___ ___ ___ ___ ___ ___ ___ ___ __ __ _SAMPLE __ _ ___________ ______________________________________________

______________________________________________________________________________________________________________________

KE MODEL COLOR STATE LICENSE PLATE # _________________________________________________________________________________________

SAMPLE

SAMPLE SAMPLE SAMPLE SAMPLE _________________________________________________________________________________________

SAMPLE SAMPLE __ __ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ _______________________________________________________________________

SAMPLE SAMPLE _______________________ ________________________________________________

VEHICLES

SAMPLE ___ __ ___ ___ ___ ___ ___ ___ ___ __ __ _SAMPLE __ ___ __ __ __ _ ___ __ ___ ___ ___ ___ ___ __ _______________________________________________________________________

SAMPLE

SAMPLE SAMPLE SAMPLE SAMPLE _________________________________________________________________________________________

SAMPLESAMPLE SAMPLE SAMPLE SAMPLE _________________________________________________________________________________________

SAMPLESAMPLE SAMPLE SAMPLE SAMPLE _____________________________________________ ____________________________________________ SAMPLE

SAMPLE ON SITE

c X PER DAY @

LATE FEE BECOMES DUE WHEN RENT IS NOT RECEIVED BY THE END OF THE 4TH DAY OF THE RENTAL PERIOD.

SEE INSTALLMENT PAYMENT AGREEMENT OR SPECIAL PROVISIONS IF BALANCE DUE _______________________________________________________________________

SAMPLE SAMPLE ___ __ ___ ___ ___ ___ ___ ___ ___ ____ ___ __ __ _ __ _ ______________________________________________

c X FLAT AMOUNT OF

LATE RENT PAYMENT FEE: (CHOOSE ONE)

c X IF CHECKED, SEE MOVE-IN ACCOUNTING

_______________________________________________________________________ ___ __ ___ ___ ___ ___ __ ___ __ ___ ___ ___ ___ ___ ___ __

TAMPERING FEE (NOT TO EXCEED $250) ($250 IF BLANK) ________________________________________________________________________________________

__ __ __ __ __ __ __ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ ___ __ __ __ __ _______________________________________________________________________

$35 + BANK CHARGES

________________________________________________________________________________________ _ __ ___ __ ___ __ __ _

___ __ ___ ___ ___ ___ ___ ___ __ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ____ __ __ ___ __ ___ __ _______________________ ________________________________________________

SAMPLE

RESIDENT

SAMPLE

MAIN OFFICE (IF REQUIRED)

c X

TYPE OF CARBON MONOXIDE ALARM:

c X BATTERY

PAID FOR / PROVIDED BY:

ELECTRIC

c ERY BACKU BACKUP X ELECTRIC WITH BATTERY

ELECTRICITY

WATER

SEWER

c X

OWNER

c X ELECTRIC

c TH BAT BATTERY A TERY BACKUP AT CKUP X ELECTRIC WITH

c X

RESIDENT

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c X c X

c X

BASIC CABLE

GAS

OTHER

c X

SAMPLE

___________________________ _ __ ___ __ __ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ __

c X IF CHECKED, SEE UTILITY BILL-BACK ADDENDUM (FORM # M047)

c X

THE FOLLOWING UTILITIES OR SERVICES PAID FOR BY SER SERVICE CE C CHARGE FOR SAMPLE ___ __ __ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ __ __ ___ __ __ __ ___ __ ___ __ ___ __ ___ ___ __ CABLE / INTERNET / ETC. ($ or %): RESIDENT WILL BENEFIT OTHER RESIDENTS OR OWNER/AGENT: _____________________________________________________________

c R ERTY X IF CHECKED, PETS ARE NOT ALLOWED AT THIS PROPERTY

SAMPLE

______________________________________________________________________________ ________________________________________________________________________________________ ___ __ ___ ___ ___ ___ __

___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ____ ___ ___ ___ ___ ___ ___ __ _______________________________________________________________________

SAMPLE

ZIP

EARLY TERMINATION FEES MAY APPLY—SEE SECTION 4 OF THE TERMS AND CONDITIONS

FEES S

TENANCY

SAMPLE c X LEASE TERM BEGINNING:

______________________________________________________

c X 10-YEAR BATTERY

SAMPLE

______________________________

ANY YARD INCLUDED IN THE LEASED PREMISES WILL BE MAINTAINED NTA T INED BY: c TA R SIDENT (SEE SECTION 11 FOR MAINTENANCE REQUIREMENTS) X RESIDENT c NS BELOW FOR OWNER/AGENT OWNER/A / G /A ENTRY RIGHTS) X OWNER/AGENT (SEE SECTION 19 OF THE TERMS AND CONDITIONS

PHONE SAMPLE ___________________________________________________

OWNER /AGENT

ZIP

SAMPLE SAMPLE _____________________________________________

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F ACT

UTILITIES

DESIGNATED CONTACT INF

SAMPLESAMPLE SAMPLE

c & TYPE: ROVED BY B OWNER/AGENT—NUMBER WNER/ R/A R/ /AGENT— X IF CHECKED, THE FOLLOWING PETS ARE APPROVED

OTHER

SAMPLE ____________________________________________________________________________________ c X ACTUAL NOTICE BY EMAIL ALLOWED

(COLLECTIVELY “RESIDENT”) _______________________________________

PARTIES

PREMISES ADDRESS

_ ___________________________________

____________ _____

TYPE OF SMOKE ALARM:

I have received instructions on the proper use of the smoke alarm and carbon monoxide alarm, larm r , if app rm applicable. p lilic pp icable l . le

SAMPLE SAMPLE ______________________________________________________________________________________________________________________________________________________________________ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ ___ __ ___ ___ ___ ___ __ __ SAMPLE __ SAMPLE SAMPLE SAMPLE ________________________________________________________________________________________________________ SAMPLE SAMPLE _________________________________________________________________________________

SMOKE ALARMS & CARBON MONOXIDE ALARMS: Resident acknowledges and Owner/Agent certifies that the unit is equipped with a smoke alarm and, if required, a carbon monoxide alarm and that the smoke alarm and the carbon monoxide alarm have been tested and are operable at this time. It is Resident’s responsibility to test the smoke alarm and carbon monoxide alarm at least every six (6) months, replace dead batteries as required, and notify Owner/Agent in writing of any operating deficiencies. Resident shall not remove or tamper with a functioning smoke alarm or carbon monoxide alarm,, inclu including removing working batteries, and Owner/Agent may charge a fee of up to $250.00 for any such conduct.

APPROVED FOR USE:

c X WATERBED

c UARIUM X AQUARIUM

c RE ED X IF CHECKED, RENTER’S INSURANCE IS REQUIRED

SMOKING POLICY:

_________________

c X SMOKING ALLO KI c ALLOW X SMOKING

THE DWELLING UNIT IS LOCATED LOCAT A ED W AT

OKING PROHIBITED—ENTIRE PREMISES KING POLICY ADDENDUM)

RESIDENT XSAMPLE

____________________________________________ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ ___ ___ __ ___ ___ ___ __

RESIDENT XSAMPLE

RESIDENT XSAMPLE __________________ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ __

MAILBOX: ________________________________________________________

LISTED ON ALL PAGES OF THIS AGREEMENT.

_____________________________________________________________________________________________________ __ __ __ __ __ __ _

ATE

SAMPLE

RESIDENT XSAMPLE

DATE

SAMPLE

RESIDENT XSAMPLE

DATE

SAMPLE

DATE

SAMPLE

___________________________________________________________________________________________________________ _ __ __ __ __ __ __ __ ___ __ ___ ___ ___ __ ___________________________________________________________ ___________________________________________________________ ___ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ __ ___ ___ ___ ___ ___ ___ ___ ___ ___ __ ___

DATE SAMPLE RESIDENT XSAMPLE SAMPLE ________________________________________________ ___ __ ___ ___ ___ __ __ _DATE _TE__ __ ___ _ __ __

PERSON TO CONTA CONTACT THE EVENT T CT IN TH TA ENT OF AN EMERGENCY

SAMPLE

PHONE

_____________________________________________________________________________________________________________ ___ __ ___ ___ ___ ___ ___ ___ __

PERSON TO CONTACT IN THE EVENT OF MY DEATH

_________________ _ __ __ ___ __

SAMPLE

_________________________________________________________________________________________________

ADDRESS, CITY, STATE, ZIP SAMPLE ___________________________________

SAMPLE

_______________________________________________________________________________________ _ __

SAMPLE

__________________________________________________ _ __ __ __ __ __ __ __ ___ __ __ __ __ __ __ ___ __ ___ ___ ___ ___ ___ __

ADDRESS, CITY, STATE,, ZIP ____________________________________________ ___ __ ___ ___ _SAMPLE __ __

OWNER/AGENT X

SAMPLE

_____________________________________________________________________

SAMPLE POLICY #_____________________________________________________________

N: c X YES c X NO

I / WE HAVE READ AND AGREE E TO THE

____________________________________________ ___ __ ___ ___ ___ ___ ___ __

____________________________________________ ___ __ ___ ___ ___ ___ ___ ___ __ ___ __ ___ ___ ___ __ _ __

SAMPLE

_____________________________________________________________________________________

c X TTHE FOLLOWING MUSICAL INSTRUMENTS:

SAMPLE MINIMUM IN INSURANCE RANCE AM AMOUNT $_____________________________________ ($100,000 IF LEFT BLANK)

INSURANCE COMPANY NAME____SAMPLE

IF APP

___

SAMPLE

_________________________________________ _ _ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __

_________________ ___ __ ___ _ BLE, REAL ESTATE BROKER APPROVAL BLE

SAMPLE

INITIAL________________________ DATE______________________________

TERMS AND CONDITIONS

1. RENTS: Unless another date is set forth above, rents are due and payable on the first of the month and must be paid on time. If rent is not paid by the end of the 4th day of the rental period a late fee in the amount stated on this Rental Agreement will be imposed on the 5th day of the rental period and Owner/Agent may require the rent payment and late fee to be paid by certified check or money order. Partial payments will not be accepted without prior Owner/Agent approval. To protect Own r n its Agents, Owner/Agent may refuse to o ac payments of rent, rent payments ts fro other than Resident or multiple . e check If any check from Resident hass been d o for any reason, Owner/Agent ent ma Resident to make all future rent payme tified check or money order. Month-to-month rents may be increased with a 30-day* 0-day* written writt notice. The daily prorates of rents and other her monthly charges will be based on one of the following methods chosen by Owner/Agent, Agent, which method will be consistently applied lied throughout the rental term: a) a 360-day year composed of twelve months of 30 days each;

b) a 365-day day year; ye or days in the he current month. m th. The daily amount amou will be m ctual c al number of days off occup nt month. NOTE: Unless Unle otherwis e pro-rate shall sh be based b n a 365-d ain loc ctions, time ctions the minimum mini gen rease rents nts is i longer. NT RENT OR OTHER r nt is not paid when due, ue a 144-hour notice of or after the 5th day of the our o notice of nonpayment th day of the rental period. ident to timely pay any other m Owner/Agent is a material nonith this Rental Agreement. I N OF PAYMENTS: Except as set forth below, all payments made by Resident to l Owner/Agent Own after the tenancy commences, no matter how designated by Resident, may be mat applied by Owner/Agent as follows: first to any ap outstanding amounts due Owner/Agent for damages/repairs, utilities, deposits, fees, etc.; second, to any rent outstanding from prior months; and third, to the current month’s rent. Owner/Agent ON SITE

RESIDENT

may not deduct a previously imposed late charge from a current or subsequent rental period rent payment, thereby making that rent payment delinquent for imposition of a new or additional late charge or for termination of the tenancy for nonpayment of rent. Owner/Agent may not deduct a noncompliance fee from a rent payment. 4. EARLY TERMINATION OF FIXED TERM TENANCY: Upon any failure of Resident to occupy the Premises for the full term of a fixed term tenancy, for any reason other than as provided in ORS 90.453(2), 90.472 or 90.475, Owner/ Agent may charge Resident either: A) all of the following: i) all rent, unpaid fees and other non-rent charges accrued prior to the date that Owner/Agent knew or reasonably should have known of the abandonment or relinquishment of the Premises; ii) all damages relating to the condition of the Premises; iii) an early termination fee in an amount not to exceed one and one-half month’s stated rent and which is due on the earlier of the date Resident gives notice to vacate or the date the Premises is vacated; iv) interest on the above amounts at the statutory rate from the date each was due, and v) all other amounts are

MAIN OFFICE (IF REQUIRED)

PAGE 1 OF 4

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RENTAL AGREEMENT

due at the times specified in this Rental Agreement; or B) all actual damages resulting from the early termination, including but not limited to: (i) repayment of concessions; all rent through the earlier of the date the Premises is re-rented and the lease termination date; (ii) advertising and administrative costs to re-rent the Premises; (iii) concessions given to re-rent the Premises; (iv) the difference in rent if a lower rental rate is received from a replacement resident during the remaining term of the original Rental Agreement; (v) damages related to the condition of the Premises, and (iv) interest on all amounts at the statutory rate. TERMINATION OF MONTH-TO-MONTH TENANCY: A 30-day written notice to terminate will be required for Resident to terminate a monthto-month tenancy. Any termination notice from Resident may not be revoked without Owner/ Agent’s written consent. Owner/Agent must give at least 30* days’ written notice to terminate a month-to-month tenancy during the first year of the occupancy. Except as otherwise provided by law, after the first year of occupancy at least 60* days’ written notice will be required. First year of the occupancy includes all periods in which any of the Residents has resided in the unit for year or less. If Resident fails to vacate at t of any termination notice, Resident will for Owner/Agent’s actual damages. *In certain local jurisdictions, the minimu period for Owner/Agent to terminate using of tenancy notice is longer. CONVERSION OF FIXED-TER NCY: TER fixed-term tenancy will automat t to tomat a month-to-month tenancyy unle has properly terminated the tena least 30* days’ written notice pr the fixed term, or 60* days by th r if such termination nation is after aft the fi pancy. n local jurisdictions, jurisdic *In certain the e period for d or Owner/Agent Owner/ nt to termin of tenancy ncy notice is longer. PETS, WATERBEDS UWAT WA ATERBEDS AND MUS MENTS: No cats, dogs or other c ble of causing damage are mage to persons p ns or property pr allowed on the Premises or living ses (either visiting visit there) without a signed payment ned pet agreement, agreem of any deposit, and nd providing insurance, as Agent Resident will be required by Owner/Agent. responsible for any and all damage caused by his/her pet(s). Waterbeds and/or aquariums are permissible only with proper insurance and written approval by Owner/Agent. Musical instruments which can be heard outside the confines of the dwelling unit are not allowed without the prior written consent of Owner/Agent. OCCUPANTS: The Premises will be used only for housing persons listed on this Rental Agreement. Additional Residents must be approved by Owner/Agent and are subject to full screening procedures. Persons other than those specifically listed on this Rental Agreement shall be strictly prohibited from staying in the Premises for more than 10 consecutive days, or a total of 20 days in any 12-month period. For purposes of this section, “staying in the Premises” means presence on the Premises for a substantia amount of time, whether during the day o overnight, and shall include, but not be limited to, long-term or regular house guests, live-in babysitters, visiting relatives, etc. Resident shall notify Owner/Agent in writing at the earli r the Resident expects any guest excess of the time limits containn agraph; or when such person si excess of such time limits. Subsi shall be required to submit a Owner/Agent identifying any pe e fied on this Rental Agreement and staying iin the rental unit for more than 10 consecutive utive days, ys, or 20 nonconsecutive days in any 12-month period, eriod, and shall state whether such person is contributing ributing to the income of Resident and to what extent. xtent. Owner/Agent may require any person listed on page 1 as an “Other Occupant,” upon reaching the

age of 18, to submit an application and screening charge to Owner/Agent, be screened and if the person meets all current screening criteria, be added to this Rental Agreement as a Resident. Failure to submit an application and screeningg charge within 10 days of Owner/Agent’s request, est, failure to meet the screening criteria, or failure to execute documents to be added as a Resident ning, will be within 10 days of a successful screening, eement. a material violation of this Rental Agreement. 9. SUBLETTING: Transfer of any interestt in this es, or Rental Agreement or subletting the Premises, any part, is not permitted without Owner/Agent w ent written approval. Subletting etting means allowing anyone to stay in y onsideration, including but not limit short-term rentals. 10.CARE OF P k all areas of from an and s ma t sh artic re ar nd oth R lammable azll not store personal in amounts which: is es proper air cirte h; impedes safe ; ors; encourages t creates the poteno the Premises or danger for hbors living on the Premises. onsible for all damages to furonsi ises caused by his/her neglii d normal wear and tear. Smoke ver be considered normal wear R ident shall report leaky or defective once. Resident must pay for any and nse due to damage to the building or furngs, other than ordinary wear and tear, uding but not limited to damage caused by stoppage of waste pipes or overflows of bathtubs, toilets or wash basins. Resident is responsible for replacing lightbulbs which fail during the tenancy. 11. YARD MAINTENANCE: If the yard is to be maintained by Resident, it must be maintained in a clean and well groomed manner, including but not limited to, adequate watering of all lawns planted areas, mowing and edging the law fertilizing the lawn(s) and all plants as neede and removing invasive weeds. If y adequately maintained, in additio remedies for material non-com Agent may, after at least 10 d perform maintenance work n Resident for such work. 12.WINTERIZATION: R winterize the Premi on all exterior hos g tems and ensurin Premises during t . hat inclu Premises that s responsible ble for ke in snow and ice 13.BAR ly comply laons rela . any , fire co ther charropa conies or s ec ed by a fire or t building surstible. The only i tric-style barbecues barbecues that utilize linders. These may be ell away from combustible b es and unplugged or with cylinder applicable) when not in use. Fire bited. ND CHANGES TO PREMISES: Resident will: (a) use all electrical, plumbing, Res sanitary, heating, ventilating, air conditioning san and other facilities and appliances on the Premises in a reasonable manner; (b) immediP ately obtain, pay for and not allow to be disconnected or discontinued the utilities for which Resident is responsible; (c) make no changes or additions to the Premises of any nature; (d) not ON SITE

RESIDENT

install or attach anything on the walls, ceilings or in the windows that will cause damage to the unit without the prior written consent of Owner/Agent; (e) not hang anything on or tamper with any fire safety system; (f) not engage in any conduct that violates any applicable laws. Satellite dishes t and/or antennas will be allowed only in strict compliance with Owner/Agent’s satellite dish com policy and applicable law. 15.DAMAGE: Resident agrees not to destroy, dam15.DAMA R age, deface age ace or remove any part of the Premises or permit to do so and to assume o rmit any persons pe all liability other than ordinary wear iability for damages d and tear. CURITY CURIT DEPOSITS: All refundable deposits, wever wev designated, may be used by Owner/ ent en to offset any damage, unusual wear and ear or unpaid accounts (including rent) either uring the tenancy or at the time of move-out. Owner/Agent may deduct the cost of carpet cleaning from the deposit regardless of whether Resident cleans the carpet before delivering possession of the Premises back to Owner/Agent. If any portion of the deposit is used during the tenancy, Resident will replenish it upon demand. If applied at move-out, any excess will be refunded within the time required by law. Any deficiency will be due from Resident at the time the accounting is sent to Resident. Any amounts not paid by Resident within 31 days of the due date will incur interest at 1% per month. Sending the accounting and/or refunding any deposit does not waive the Owner/Agent’s right to payment for charges discovered or finalized after the accounting was sent. Any security deposit received from multiple Residents shall be refunded only when the last Resident vacates the Premises and terminates his/her tenancy less other arrangements are made with gent in writing. Security deposits osited into an interestbearing nterest shall accrue to the benefi n uant to any agreement betw n interest will be paid to R its. If the “Deposits Held e e 1 of this Rental A s eposited by Agent i uired by Oregon law. Agent will then forward the deposits to the Owner of the property, who wh will manage deposits pursuant ant to Oregon Oreg law. N N FEES Owner/Agent may N-COMPLIANCE FEES: rge a fee for or a second se nd noncompliance or for ubsequent with written rules ubseq nt noncompliance noncom policies that describe the prohibited conduct desc the fee for a second noncompliance, and for se an third or subsequent noncompliance, that sub occurss within one year after a written warning notice. The fee may not exceed $50 for the second noncompliance within one year after the warning notice for the same or a similar noncompliance or $50 plus five percent of the rent payment for the current rental period for a third or subsequent noncompliance within one year after the warning notice for the same or a similar noncompliance. Owner/Agent may charge a fee for occurrences of noncompliance with written rules or policies for the following types of noncompliance: (A) The late payment of a utility or service charge that the tenant owes the landlord. (B) Failure to clean up pet waste from a part of the premises other than the dwelling unit. (C) Failure to clean up garbage, rubbish and other waste from a part of the premises other than the dwelling unit. (D) Parking violations. (E) The improper use of vehicles within the premises. (F) Smoking in a clearly designated nonsmoking unit or area of the premises. (G) Keeping on the premises an unauthorized pet capable of causing damage to persons or property. 18.JOINT RESPONSIBILITY: Each Resident is jointly and severally responsible for rent, all other performance and financial obligations hereunder and any damage caused to the Premises or common area by Resident, any Resident or Occupant of the same Premises or his/her guests. Cost of repairs for damage must be paid within 30 days after receiving a bill unless other arrangements have been made, in writing, with Owner/Agent. Any valid termination notice

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RENTAL AGREEMENT

received from any one Resident may be considered by Owner/Agent a termination notice from all Residents. Any Resident not giving the notice who desires to remain in the Premises may be required to submit updated financial information and requalify under Owner/Agent’s then-current criteria. 19.ACCESS: Resident agrees not to unreasonably withhold consent to Owner/Agent to enter the Premises in order to inspect the Premises, make necessary or agreed repairs, decorations, alterations, or improvements or to show the Premises to prospective buyers or residents. Owner/Agent may enter the Premises without consent in an emergency or at any reasonable time with 24 hours’ actual notice or after receipt of Resident’s written request for maintenance. If Owner/Agent is obligated to maintain the yard, Owner/Agent, or its contractors, may enter the yard (but not the dwelling unit) without notice, at reasonable times and with reasonable frequency, to perform the maintenance work. Owner/Agent may enter the Premises (but not the dwelling unit) without notice to serve notices permitted under this Rental Agreement or by law. 20.ABSENCE: Resident agrees to notify Owner/ Agent of any absence in excess of seven (7) days no later than the first day of absence. 21.LEGAL ACTION: In the event Owner/Agentt has to bring an action to enforce any provisionss of this esidential Rental Agreement or the Oregon Residential Landlord and Tenant Act, the prevaili shall be entitled to, in addition to costs, re able attorney’s fees. 22.LOCKS: Doors of Resident shoul be kept locked. Residentt s ner/ Agent in writing if locks failil Agent will not be liable or way for loss or damage to belonging to Resident. Reside c the locks without hout Owner/Agen Owne Resident shall hall immediately immediate provid with a key / ey to any new locks inst Agent is not required k s. requ d to o provi 23.RENTER’S ’ e R’S INSURANCE: If is required t, ent ed by this Rental Ag will obtainn and maintain ins it ability coverages off at least the listed. th minimum mum amount am Resident will supply Owner/Agent wner/A w evidence //Agent with of such insurance prior or to occupying the Premises. Owner/Agent mayy require documentation that docu Resident maintains the renter’s renter’ liability insurance on a periodic basis related to the coverage period of the renter’s liability insurance policy or more frequently if Owner/Agent reasonably believes that the insurance policy is no longer in effect. Failure to maintain such insurance in full force will be considered a material non-compliance with this Rental Agreement. Owner/Agent may require that Resident obtain or maintain renter’s liability insurance only if Owner/Agent obtains and maintains comparable liability insurance and provides documentation to any Resident who requests the documentation, orally or in writing. Owner/ Agent may provide documentation to Resident in person, by mail or by posting in a common area or office. The documentation may consist of a current certificate of coverage. If insurance is not required by this Rental Agreement, Resident should maintain renter’s insurance to cover Resident’s liability to Owner/Agent, as well as damage or destruction of Resident’s property. Whether or not renter’s insurance is required, Resident is not a co-insured under, and has no rights to, Owner/Agent’s insurance policies. Except to the extent law, Owner/Agent is not respons insurance does not cover dam to, Resident’s property. 24.CONDUCT: The Premises is a dwelling. The Premises may conduct of any commercial ac customers or clients coming to the he unit (includ(includ ing but not limited to day care) or the delivery or deliv o storage of inventory or equipment. Each Resident dent is responsible for his/her own conduct, as well as that of the other Residents in the Premises mises and their guests. Noisy or other conduct that disturbs the quiet enjoyment of any other resident or neighbors or drunk or disorderly conduct will

not be permitted at any time. Between 10:00 p.m. and 7:00 a.m. the level and/or type of noise emitted from the unit may not exceed what is normal and customary for similar housing. Residents will not be permitted to play in halls, stairways or entrance of buildings, gardens or landscape ape areas except where specifically permitted ed by Owner/Agent. The use, possession, manufacture, ufacture, or distribution of illegal substances, as defined in either federal or state law, either on n or in the vicinity of the Premises is strictly prohibited. hibited. Resident may not allow any person to: a) be on the Premises who has been excluded from the common areas by Owner/Agent; er/Ag or b) stay in his/her Premises, as ction 8 above, who has had his/he ment terminated by Owner/Agent. Resident any occupant or guest of Resid sid agement of the material it al non Agreement. ew e in c ement. N endangers l ers. N ll ngers the enter property t are ente or use a not intended ents such as roofs, inte ed fo attics, crawl enance shops, etc. cra sp 25.MALFUNCTIO t will immediately 25.MALFUNCT report in writin s of equipment, failures of esse needs for repair. Resident h the heating sysesident shall system appliances, locks, doors, tem plumbing system, smoke alarms or carbon monoxide ala OSSES: Owner/Agent shall not O S da damages of any kind caused by at, refrigeration or other services ises arising out of any accident, act r occurrence beyond the control of r Agent. Resident shall be limited to the s and remedies specified in the Oregon esidential Landlord and Tenant Act. . CO-SIGNER: If the obligations under this Rental Agreement are guaranteed by a co-signer, Resident agrees that Owner/Agent would not have rented without the guaranty. In the event the guaranty is terminated or becomes unenforceable for any reason, this will be considered a material non-compliance with this Rental Agreement. 28.HOUSE RULES: Owner/Agent’s custom r and regulations for the property, as well a rules and regulations contained in Multifamily form M204 OR-WA (House Rules & R ) apply and are incorporated by refe 29.WRITTEN NOTICES: All notices this Rental Agreement or stat ing shall be served person s or by first class mail an e by first class mail and Owner/Agent to R served on the d t mailed by first c Premises and attach n main entrance nce tha which Reside eside first cl Resid d served s ail to Ow h on ental Ag a secure the complex ists, wner/Agent’s o t of this Rental to Owner/Agent’s cured building, the to the main entrance is authorized to accept lf wner. TICE: Whenever state law requires such notice may be served by the following methods: (a) verbally gent or Resident or by leaving a message on Owner/Agent’s or Resident’s mes answering machine or voicemail system; (b) ans written notice that is personally delivered to wri Owner/Agent O or Resident, left at Owner/Agent’s rental office, sent by facsimile to Owner/ Agent’s residence or rental office or to Resident’s Premises, or attached in a secure manner to the main entrance of Owner/Agent’s residence or ON SITE

RESIDENT

Resident’s Premises; (c) written notice that is delivered by first class mail to Owner/Agent or Resident, which notice shall be considered served three days after the date the notice was mailed; or (d) if an email address is included on t front of this Rental Agreement for Owner/ the Agent and/or Resident and the “Actual notice by g email ema allowed” box is checked, an email sent to such address, or such other email address as a either party ty may supply from time to time. Resident for keeping Owner/Agent Res t is responsible res advised to his/her email address. ad ed of any changes c 31.CONTROL OF COMMON AREAS: Owner/Agent and any person designated by Owner/Agent pe retain control over any common areas of the co property propert of which the Premises are a part for the purposes of enforcing state trespass laws and purp shall be the “person in charge” for that purpose as that phrase is defined at ORS 164.205(5). If Owner/Agent excludes a person from the common areas, Resident may not invite such person into their unit or grant permission to such person to enter or remain on the common areas. 32.REQUESTS FOR REASONABLE ACCOMMODATION/MODIFICATION: As required under federal, state, and local fair housing laws, Residents with disabilities may request reasonable accommodations/modifications related to their housing. All requests must be made to the Owner/Agent specifying the nature of the requested accommodation/modification. It is recommended, but not required, that such requests be made in writing. 33.TERMINATION FOR FALSE INFORMATION OR CRIMINAL CONVICTION: If any information supplied in conjunction with application for this Premises is later found to be false, or if any occupant is con d of a crime during the tenancy that wo titute grounds for denial of tenancy r/Agent’s current rental criteria, t or termination of tenancy. 34.RESC esident authorizes Own b or updated consu investigative consume r to transfer to anot ither the Owner or nt leaves or a new Res ner/Agent; or for any other rpose. A conmer credit repor gative consumer t may incl g of the Resident’s inco t, rental history, and and may include inforharacter, general reputateristics, and mode of living. E as the right to request addition s provided under Section 606 (b) of the redit Reporting act, and a written summary of your rights pursuant to Section 609(c). Each Resident has the right to dispute the accuracy of the information provided to the Owner/Agent by the screening company or the credit reporting agency as well as complete and accurate disclosure of the nature and scope of the investigation. Residents agree to reimburse Owner/Agent for the costs of such report(s). 35.SALE OF PROPERTY: Upon any sale of the Premises, Resident will look solely to the new Owner for all future performance under this Rental Agreement, including but not limited to return of the security deposit. Nothing contained herein makes the new Owner liable for occurrences prior to the sale or releases the selling Owner from liability that accrued during his/her ownership. 36.C O M P L E T E A G R E E M E N T: T h i s R e n t a l Agreement, any rules and regulations for the Premises, and, except as provided below, any other written addenda executed by the parties on or after the date of this Rental Agreement contain the entire understanding of the parties. There are no prior oral or written agreements unless they are referenced herein. If this is a renewal of an existing Rental Agreement, all written addenda executed on or after the date of the original Rental Agreement, to the extent consistent herewith, remain in effect and are incorporated herein.

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c X RENEWAL

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Rental Housing Journal Metro · December 2015

Rental Housing Journal Metro

Will 2016 be a Super El Niño Year?

4 Reasons Why Women Will Lead The Business World In The 21st Century

By Jerry L’Ecuyer and Frankie Alvarez of Dear Maintenance Men

e have been living with drought in the Western United States for a long time now. So the prediction of a strong, wet El Niño year is quite appealing. Will it fill our reservoirs, recharge our aquafers, and bring us back to normal? Hard to tell; many experts say we may need multiple years of El Niño to be back to pre-drought conditions. First a short explanation by some of the experts as to what an El Niño condition is. An El Niño is a weather pattern produced by unusually warm ocean temperatures in the Equatorial Pacific. The El Niño phenomenon is associated with extreme weather around the globe and in California it typically means a wet winter with higher than normal rain levels. As early as last spring, the National Oceanic and Atmospheric Administration (NOAA) was predicting a 60 percent chance that the El Niño conditions will continue all year. Now that we are much closer to the end of the year, the experts are predicting closer to 100% that 2016 will being a strong or super “El Niño” year. Dr. Dough Gillham a Meteorologist, PhD tells us: “We are in the midst of a rapidly strengthening El Niño event which will likely peak later in fall as one of the strongest El Niño events on record.” El Niño has a reputation for bringing mild winters to much of the country, especially across the northern States. The two strongest two El Niño events on record prior to this year (1982-83 and 1997-98) were quite mild from the Pacific Northwest to the Northeast. Only the Southwestern States saw below average temperatures during those winters. However, a review of other El Niño winters shows that a strong El Niño does not guarantee a mild winter. A unique feature of the upcoming winter compared to other strong El Niño winters of the past is the expected persistence of the warmer-than-normal ocean-water temperatures south of Alaska. Some have referred to this feature as “the Blob” and it has been a key contributor to the dominant weather pattern across North America for the past two years. This pattern has been associated with extended periods of warm and dry weather in the West and two of the coldest winters in recent memory further to the east, especially in the Great Lakes and Northeast. If “the Blob”

does indeed persist through the upcoming winter, then the threat for a cold conclusion to winter in the East will increase. Now that we know what an El Niño weather condition is, how do we prepare for El Niño? First order of business is to take a long hard look at your apartment building and surrounding property. Inspect your building’s roofs, gutters, drains, flashing and trim overhanging trees. In other words, don’t wait for it to be raining to find out your roof is in poor condition. Get the work done now while it is dry and the roofing companies are not busy. Don’t forget about large trees that hang over your roofs. In wet windy weather, they can cause a lot of damage to a roof if a limb breaks or a tree falls because of soggy soil. Flat roofs are especially vulnerable to blocked scuppers and roof drains. The backed up water will find the slightest weakness in any roof system and may even cause a roof to collapse. Make sure the landscaping around your property is designed to drain away water quickly. Connect downspout extenders at the ground level. The extenders will direct water away from the building. Check for stucco cracks. A surprising amount of water can be sucked into a building because of damaged stucco. Clean out window weep holes to stop water from finding its way through window frames and damaging interior walls. If you have wooden garage doors, check that the doors are painted or sealed and that the springs are in good order. The garage doors can get quite a bit heavier when wet or allowed to soak up water. A little bit of preventive maintenance now will save both you and your residents a lot of discomfort later. And last but not least, don’t forget to turn off your sprinklers. Bio: Please call: Buffalo Maintenance, Inc for maintenance work or consultation. JLE Property Management, Inc for management service or consultation Frankie Alvarez at 714 956-8371 Jerry L’Ecuyer at 714 778-0480 CA contractor lic: #797645, EPA Real Estate lic. #: 01460075 Certified Renovation Company www.BuffaloMaintenance.com www.ContactJLE.com www.Facebook.com/BuffaloMaintenance

hen you let women be women in the business world, they do better. That’s according to a recent report from the Harvard Business Review, which makes the case that traditional thinking – that women should be treated no differently than men in corporate settings – is simply flawed and regressive. A major point the post makes is that only about 20 percent of businesswomen make partner. By expecting from women what you would expect from men, the corporate world is consciously and

unconsciously excluding female leadership. That’s a very bad thing, according to many. For example, Kevin O’Leary of “Shark Tank” fame says that of his 27 companies, only the ones with female CEOs make him money. “Women are good for business, so it follows that what’s good for your best women will be good for your bottom line,” says Debora McLaughlin, CEO of The Renegade Leader Coaching and Con...continued on page 19

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Rental Housing Journal Metro

3Q15 Market Overview ...continued from page 12

The information contained in this report was prepared for general information purposes only and is not intended as legal, tax, accounting or financial advice, or recommendations to buy or sell currencies or securities or to engage in any specific transactions. Information has been gathered from third party sources and has not been independently verified or accepted by RED Capital Group. RED makes no representations or warranties as to the accuracy or completeness of the information, assumptions, analyses or conclusions presented in the report. RED cannot be held responsible for any errors or misrepresentations contained in the report or in the information gathered from third party sources. Under no circumstances should any information contained herein be used or considered as an oﬀer or a solicitation of an oﬀer to participate in any particular transaction or strategy. Any reliance upon this information is solely and exclusively at your own risk. Please consult your own counsel, accountant or other advisor regarding your specific situation. Any views expressed herein are subject to change without notice due to market conditions and other factors.

...continued on page 17

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Rental Housing Journal Metro · December 2015

Rental Housing Journal Metro

DEAR MAINTENANCE MEN By Jerry L’Ecuyer & Frank Alvarez

Dear Maintenance Men, I have given my residents information on how to prepare a personal emergency preparedness kit for their families. My question is for you is: does my Apartment or commercial building need an emergency preparedness kit? And if so, what should be in it? Diana

Dear Diana, A quick list of what should be in your family disaster preparedness kit: Flashlight with batteries, canned goods, a Gallon of water per person, a knife, Meds and blankets at minimum. Now this works ok for a family, but may not be appropriate for an apartment building. The residents may very well shelter in place during a disaster and be fine. What may be in danger is your property! Start with a bit of preventive disaster maintenance. 1. Locate the main water shut-off valve and any minor shut-off valves. Make sure the valves are in working order. If they are gate valves, it might be time to upgrade them to ball valves. Old gate valves are notorious for breaking valve stems at the moment you need them to work. 2. Locate and clearly mark the main electrical panel. 3. Locate and mark the main sewer clean-out. Run a mainline snake or hydro jet at least once a year.

Emergency Preparedness (A Friday evening main back-up is a disaster.) 4. Locate and mark the main gas or fuel oil shut-off valve. 5. Write down and post this information in a public area of your apartment building, including emergency phone numbers and how to get hold of management. Alternatively; Post this information on the inside of a kitchen cabinet door in each rental unit. Dear Maintenance Men, I am starting my planning for a major kitchen cabinet remodeling project in my rental units. However, I am having a difficult time making material and design decisions. What recommendations can you give? Allen

Dear Allen, When doing a kitchen or bath material selection, cohesive and functional design is important. Kitchen and bath rehabs are some of the most expensive work you can do in an apartment unit and proper planning is a must. In order to appeal to a larger segment of the population, try to keep the interior color scheme to neutral earth tones. Cabinetry quality varies greatly. Don’t let the cabinet fronts fool you. Manufactures designed their cabinets to look good at first glance. Keep in mind, being in a rental environment, the

cabinets also need to hold up to abuse. Look at the actual construction of the cabinet box or frame. There is no need to use custom cabinets to fit your existing layout. The use of prefabricated modular cabinetry can greatly reduce the time and cost to have a finished kitchen or bathroom. Using real wood cabinet fronts with 3/8” plywood sides is essential for durability. The drawer fronts and sides should be connected with a dovetail or other positive lock construction. Drawers that are held together by nails will not hold up to tenant abuse, nor will particle board constructed cabinets. On a side note; if you are gutting the kitchen or bathroom, use this time to relocate and add more electrical outlets and under cabinet lighting.

Dear Maintenance Men: I am a property supervisor for a local property management company and I am looking for solutions to my maintenance issues. How do I keep the cost of maintenance down while still maintaining good living conditions for my residents? Sally

Dear Sally: Prioritize and bundle is the short answer. To elaborate, you will want to prioritize all of your non-emergency maintenance work by unit, building and area and then bundle enough work for each unit, building or area to use your main-

tenance tech or vendor efficiently. The less your tech or vendor needs to travel between jobs the lower the cost of each job will be. Essentially, you would accumulate all non-emergency routine maintenance work placed on a P.O. or work order and forward it to your vendor or tech as authorized. This dramatically reduces the costs related to gas, trip charges, mobilization, purchase hours, etc. (It works even better if your parts are already onsite) Establishing a “time and material” (not to exceed) approach to billing vs. a per unit price method would also give you more bang for your buck. Talk to your venders or techs about bundled service to help cut costs. Most will appreciate a more organized approach to servicing your properties. Bio: Please call: Buffalo Maintenance, Inc for maintenance work or consultation. JLE Property Management, Inc for management service or consultation Frankie Alvarez at 714 956-8371 Jerry L’Ecuyer at 714 778-0480 CA contractor lic: #797645, EPA Real Estate lic. #: 01460075 Certified Renovation Company Websites: www.BuffaloMaintenance.com & www.ContactJLE.com www.Facebook.com/BuffaloMaintenance

Rental Housing Journal Metro · December 2015

Rental Housing Journal Metro

3Q15 Market Overview ...continued from page 15

Protecting Vulnerable Voters ...continued from page 1 The remaining two ordinances address the current low vacancy rates and increasing rental rates now common in the Metro area. VMC 8.46, like the Portland ordinance, extended the prior notice period landlords must provide in order to levy a rent increase. In Vancouver’s case they Source of income protection Prior notice for no cause evictions Extended notice for rent increases over threshold Threshold for extended notice

extended the time from 30 days’ notice to 45 days’ notice for an increase of 10% or more in a 12 month period. Ordinance VMC 8.47 extended the length of prior notice a landlord must give for no-cause evictions. Where landlords

once only needed to provide 20 days’ notice, they now must provide 60 days’ notice. Landlords owning fewer than five rental units are exempt from this ordinance, and the rules regarding for-cause evictions stay the same.

Like the Portland ordinances, these changes were designed to make it easier for low-income renters to secure new housing in this market if evicted or priced out of their current unit. They took effect October 21, 2015.

Vancouver prior to 10/21/15 No

Vancouver after 10/21/15 Yes

Portland after 11/13/15 Yes

20 day notice 30 day notice

60 day notice with < 5 unit exemption 45 day notice

90 day notice 90 day notice

n/a

10% increase

5% increase

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Historic Lending Discrimination Settlement Addresses Allegations Of Modern Day Redlining

By Jo Becker Education/Outreach Specialist, Fair Housing Council of Oregon

arlier this year the Department of Housing and Urban Development (HUD) announced an agreement with Associated Bank to resolve a disparate treatment redlining case. Redlining is the practice of refusing to lend or insure homes in areas deemed to be a poor financial risk due to the ethnic demographics of the areas. At approximately $200 million, this is the largest fair housing settlement of this sort against a mortgage lender. The settlement stems from a HUD-initiated complaint alleging that from 2008-2010, the Wisconsin-based bank denied mortgage loans to African-American and Hispanic applicants and provided different levels of loan services in neighborhoods with significant African-American or Hispanic populations – both violations of the FHA’s race and national origin protections. Associated Bank’s mortgage lending activity indicated that, compared to other lenders, the firm made few loans in majority-minority census tracts in five metropolitan areas, but did make loans in nearby predominantly white tracts.

The terms of the settlement include: • Nearly $10 million over three years in lower interest rate home mortgages and down payment/closing cost assistance to qualified borrowers in majority-minority census tracts in Chicago; Milwaukee; Minneapolis-St. Paul; Racine, Wisconsin; Kenosha, Wisconsin; and Lake County, Illinois; • Nearly $200 million committed to increased home mortgage lending activity in majority-minority census tracts in the same areas; • Nearly $3 million to help existing homeowners repair their properties in these predominantly minority communities; • $1.4 million to support aﬃrmative marketing of loans in the above census tracts; • $1.35 million for community reinvestment and fair lending education and training; • Four new loan production oﬃces in majority-minority census tracts in addition to three branches Associated opened or

has planned to open since HUD’s complaint was filed; • Fair housing training for all residential lending employees; • A second level review process for all denied residential loans. You can read the full agreement here – http://portal.hud.gov/hudportal/ documents/huddoc?id=ExecAssBankConAgrmnt.pdf In announcing the settlement HUD Secretary Julián Castro said, “Discriminatory lending practices have too often cut off too many credit-worthy families from the opportunities they need to thrive. This agreement will ensure that more Americans can fulfill their hopes and aspirations.” This article brought to you by the Fair Housing Council; a civil rights organization. All rights reserved © 2015. Write jbecker@FHCO.org to reprint articles or inquire about ongoing content for your own publication.

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Rental Housing Journal Metro · December 2015

Rental Housing Journal Metro

4 Reasons Why Women Will Lead ...continued from page 14

Flipping Edges Out Renting ...continued from page 10

sulting Group (www.TheRenegadeLeader.com), and author of “Running in High Heels: How to Lead with Influence, Impact & Ingenuity.” “I’ve long advocated this position, and that symbols of female business identity, like high heels, are signs of a businesswoman’s ability to elevate business results, consistently providing a better return for stakeholders.” McLaughlin discusses why women will be essential for leading businesses into a new paradigm this century.

Q3 2015 Online Investor Data: Intent of All Investors Surveyed

• The old way doesn’t work. Since 1955, more than 90 percent of the companies on the Fortune 500 list have gone bankrupt, shrunk in size, become inconsequential, been mopped up by their rivals or closed their doors. Sixty percent of CEOs think their current business model is only sustainable for another three years. Sticking too closely to your old guns, including discouraging a woman’s nature in the corporate world, will likely involve your company in that 90-plus percent failure rate. • The business world has already changed. While technology continues to revolutionize how we do business, it has also changed the workforce. Today’s employees are smarter, more innovative, more creative and full of potential – and it’s not only due to technology. As Generations X and Y emerge as tomorrow’s leaders, Millennials are proving to be very resourceful workers. Old models like “command-and-control” don’t fit with a company’s most precious resource, its people. • Women are more social and excel in collaboration. We shouldn’t general-

ize to strictly regarding gender norms. However, it’s probably fair to say that women are more nurturing for in-group members. Much of the traditional management method centralized authority; a woman’s leadership is more prone to sharing influence and, perhaps, fostering a creative culture of collaboration. “Of course, this is not a strict gender rule,” McLaughlin says. “But I think it’s the experience of many that women are, in the aggregate, more nurturing. • Momentum will continue to build for women leadership. Momentum tends to build upon itself, and that includes social change. While that change has been slower in the corporate world, we’re already seeing signs and opinions of change, as exemplified by Kevin O’Leary. “More importantly, if the Harvard Business Review’s post is an indicator, women in business will feel more comfortable being themselves in a professional environment,” she says. “Unlocking those invisible shackles from a woman’s high heels will be a game-changer.” About Debora McLaughlin

Debora McLaughlin is the best-selling author of “The Renegade Leader: 9 Success Strategies Driven Leaders Use to Ignite People, Performance and Profits.” Her new book, “Running in High Heels: How to Lead with Influence, Impact & Ingenuity,” is a how-to leadership companion for women in business. She is CEO of The Renegade Leader Coaching and Consulting Group (www.TheRenegadeLeader.com). As a certified executive coach, McLaughlin helps business owners, executives and managers nationwide ignite their inner renegade leader to unleash their full potential, drive their visions and yield positive results, both in business and in life.

Region

Flip

Rent

Undecided

West Midwest South Northeast Nationwide

45.8% 41.3% 38.6% 52.7% 43.3%

51.8% 56.6% 58.1% 45.5% 54%

2.4% 2.1% 3.3% 1.8% 2.7%

Less active investors (those indicating that they purchase one or fewer properties per year) demonstrated a strong preference for renting properties, while flipping was prevalent among investors who purchase multiple properties per year. This preference appears to be growing among investors purchasing more than 50 properties per year: nearly 68 percent of respondents in this group favored flipping in the third quarter – up from 62 percent in Q2 and 54 percent in Q1.

Q3 2015 Investor Data: Intent By Purchase Profile Purchase Profile 0-1 Property/Year 2-49 Properties/ Year 50+ Properties/ Year

Flip 37.3%

Rent 60.1%

Undecided 2.6%

58.8%

40.4%

0.8%

66.7%

33.3%

About Auction.com:

Auction.com, LLC, is the nation’s leading online real estate marketplace. Founded in 2007, the company has sold more than $32 billion in residential and commercial real estate assets. Auction.com has over 900 employees and headquarters in Irvine and Silicon Valley, Calif., as well as offices in key markets nationwide. Visit www.auction.com for more information. SOURCE Auction.com, LLC

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Rental Housing Journal Metro · December 2015