Metro ( Portland ) RHJ April 2018 by Professional Publishing, Inc

April 2018

Rental Housing Journal Metro

2. Toys R Us Downfall Reiterates Changing Retail Climate; Potential Retail Replacements to Emphasize Experiences 3.

Real Estate Syndication Investing – 10 Things to Know

4. 10 Ways to Make Small Bathrooms in Your Rentals Look Bigger and Better

RHAOregon President’s Message

6. Dear Maintenance Men: 7.

Apartment Owner Ordered to Pay $1.6 Million in Bed Bug Lawsuit

8. How Your Terms, Conditions Or Privileges Could Mean Discrimination 10. Accommodating Disabled Tenants in Your Rental Property

11. Millennials Spend About 45 Percent of Income on Rent Before Age 30

15. 20 Easy, Affordable Maintenance Projects to Update your Rentals

13. Renters Feelings about Buying Diminish as Rates Climb amid Tight Inventory

16. How a No Pet Policy can be Discriminatory 17. Application of Payments and 72 Hour Notices

14. Confused Over Service, Assistance and Emotional Support Animals?

Portland/Vancouver

www.rentalhousingjournal.com • Professional Publishing, Inc

Published in association with: Multifamily NW; Rental Housing Association of Oregon; IREM & Clark County Association

Research Says More Tenants are Renters for Financial Reasons

ew research shows that more tenants are renters for financial reasons and that a growing number are satisfied with the rental experience, according to Freddie Mac. However, renters in the West say they

How Important is the Front Door to your Rental Property?

he look, feel and features of a rental property’s front door are more important to tenants than landlords and property managers might think.Front door material and look is the maintenance checkup from Keepe this week. The front door is one of those subtle elements that can actually make a big difference to the overall feel of a property. Experts point out that a property’s front door can actually be responsible for significant fluctuations in the value of the property. Potential tenants will likely take notice of a damaged, flimsy or older-looking entryways. They could interpret this as a sign of lack of upkeep for the property or concern for the well-being of tenants. Additionally, a damaged front door can make it easy for burglars to identify a certain property as one that they could successfully break into. Pros and cons of front door material for your rental property Purchasing a brand new front door is not be a routine expense. So if you are thinking of replacing old doors or upgrading doors on your property, here are some front door materials to consider: Wooden front doors Pros: 1. Ultra-customizable - wooden doors ...continued on page 7 Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

are feeling impact of rent increases more than other areas. Among millennials 71 percent say renting is a good choice for them. The spring "Profile of Today's Renter" by Freddie Mac finds a total of 67 percent

of renters view renting as more affordable than owning a home, including 73 percent of Baby Boomers (aged 53-71). Similarly, 67 percent of renters who will continue renting say they will do so for financial ...continued on page 19

Seattle Landlords Must Charge for Parking Separate from Rent

he Seattle City Council has passed 7-1 an ordinance banning Seattle landlords and property managers from bundling the cost of parking with rental payments. Landlords of buildings with more than 10 apartments will no longer be able to include the cost of parking in rent, and must bill tenants separately for parking. Tenants, especially those who do not own a car, will have the option then of not paying the landlord for parking if they choose. “We know that an oversupply of cheap parking has a negative impact on Seattle – it increases driving and traffic congestion, increases our carbon footprint, and makes housing more expensive,” City Councilman Rob Johnson said in a statement. Mayor Jenny Durkan said in a statement she plans to sign the ordinance. "With too many Seattle residents struggle with rising rents, we need to provide more housing. We also have to make frequent transit a reality, and we will continue to work with Metro to increase service on our most popular routes in neighborhoods across Seattle," she said. “Taking a smarter approach to our parking strategies, as we do through CB 119221, an important step is to ensure that we are creating not only a more vibrant PRSRT STD US Postage PAID Portland, OR Permit #5460

city, but a city that works for everyone as we grow. The legislation allows for flexible use parking, so that existing and new parking spaces can be shared and used by more people. It eliminates parking requirements for affordable housing units (up to 80% Area Median Income) so that our affordable housing partners can build more housing, and requires unbundling

of parking in leases so people who do not own a car will not be required to pay for parking spaces they do not use,” Johnson said. “Increasing numbers of transit ridership and those who walk and bike coupled with growing options for shared ...continued on page 1

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Rental Housing Journal Metro

Toys R Us Downfall Reiterates Changing Retail Climate; Potential Retail Replacements to Emphasize Experiences

ew age of retail forces adaptation. The rapidly evolving retail landscape bypassed Toys R Us, resulting in a bankruptcy protection filing and ultimately the announced closures of roughly 800 locations. Wellestablished brands shuttering stores have become a common theme in recent years as companies who fail to adapt to the new retail reality operate with outdated strategies. The company’s weakened balance sheet hampered efforts to make investments to modernize its business model and compete with Amazon, Walmart and Target. Due to the firm’s limited online capabilities and inability to transform into an experiential retailer, consumers soon found quicker and cheaper ways to purchase toys that bypassed this traditional toy powerhouse. Strong Internet competition led to Toys R Us’ diminishing market share and the competitive gap slowly widened until it was beyond the company’s ability to bridge. Vacated space a boon to some investors and retailers. Markets with low retail vacancy and large Toys R Us footprints may be positively impacted by the company’s liquidation. The soon-to-be

vacated stores could bring much needed retail space to the market. In metros like Boston and Pittsburgh where vacancy is forecast below 3.5 percent this year, tight market conditions hinder retailers’

expansion efforts. An influx of space coming available in San Diego and Northern New Jersey could also provide relief to retailers struggling to find locations, particularly in San Diego due

to its thin retail completions over the past several years. Conversely, metros with high vacancy could encounter new challenges from the addition of available space. Riverside-San Bernardino, Houston and Detroit face this risk; more than 420,000 square feet of Toys R Us space will soon be vacant in each metro. Moving rents to market could be silver lining for some investors. Due to the lengthy leases of many Toys R Us locations, the closures will give landlords opportunities to adjust rents to match current market conditions, as many of the lease agreements include belowmarket rates. The ample amount of space anticipated to come online in the following months should support more competitive rents in neighborhoods most affected by the company’s liquidation. Landlords will soon have the option to choose a tenant better positioned to compete in the dynamic retail climate. Although the number of retailers targeting 30,000- to 40,000-square-foot locations is limited, many retailers capable of filling these spaces have reported strong performances in recent years and are seeking expansion. Strong Group of Retailers Expected to Show Interest Vacant Toys R Us ...continued on page 12

Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Real Estate Syndication Investing – 10 Things to Know by Kim Lisa Taylor, Esq.

f you are thinking of investing in a real estate syndication, especially for multifamily investing, here are 10 things to know from Kim Lisa Taylor, Esq., founding attorney of Syndication Attorneys, PLLC. If you have a self-directed IRA or substantial investment funds, you no doubt have considered investing in real estate, especially multifamily. However, you may lack the funds to invest on your own or the desire to deal with the hassles of property management. A viable option for you may be to invest in a real estate “syndication” (i.e., a group real estate investment, also known as a Private Placement Offering) as a passive investor. What is a Real Estate Syndication? In a real estate syndication, a “sponsor” or “syndicator (which may be an individual or an entity) will typically identify a real estate asset, such as an existing commercial or multifamily property (or vacant land for development) or single-family fix-and-flips that will yield a sufficient return to pay themselves and their investors from cash flow during operations and/or equity on resale. The sponsor may obtain institutional financing for a portion of the purchase price and then pool funds from private

investors to finance the down payment and closing costs, or he or she may raise all of the purchase money from private investors. The sponsor’s job will consist of finding a suitable property, putting the group of investors together and managing the asset on their behalf. In exchange for these efforts, the sponsor will receive fees and/or a percentage of the “distributable cash” (i.e., profits) left after all expenses and loan obligations have been paid. What Kind of Returns Do Syndications Offer? Typical investor returns can range from 6 % to 12% (or more) annualized, calculated against the amount of money invested. The range varies, based on the type of investment and the level of risk to which an investor may be exposed. The higher the return offered, the greater the risk. For example, an investor or selfdirected IRA might take a position as a “debt partner,” in which case the returns will be calculated as interest on the amount invested. Such returns may be in the lower ranges, but the debt partnership position may be “preferred” or “secured” by a lien against the real estate, which is a lower-risk position. Another option for investors is an “equity partnership” position, where the distributable cash is split proportionately between the group of investors and the

sponsor, whose compensation can range from 25% to 50% of the distributable cash. In this case, the investor returns may be greater, but they will be dependent on the performance of the property and the sponsor’s ability to maximize returns by increasing income and minimizing expenses. What Information Should I Get from the Syndicator? Prior to accepting any investor funds, the sponsor is required by securities laws to provide a set of offering documents that explains the terms and discloses the risks of the offering to prospective investors. Further, sponsors typically answer to their investors by means of periodic newsletters, financial reports and/ or teleconferences. Unlike a stock investment, investors may also have some limited voting rights regarding major decisions affecting the company or their investment. Investing In A Real Estate Syndication - 10 Things To Know Before investing in a real estate syndication, you should carefully review all of the offering documents provided by the sponsor and look for (or ask) questions regarding the following things: 1. The Sponsor’s background, education and experience with similar investments, if any.

2. The team members involved in acquisition and operation of the property, including attorneys, CPAs, other members of the sponsor, property managers and affiliates that may receive fees, etc. 3. Cash distributions to investors during acquisition, operation and disposition of the property, including the proposed timing and anticipated percentage returns. 4. Sponsor fees and cash distributions. 5. Anticipated duration of the investment. 6. Property information, including its type and condition, the purchase price, financial history, proposed “value add” and exit strategies and pro forma financial projections. 7. Dispute resolution provisions. 8. Voting rights of investors. 9. Provisions for removal of the sponsor. 10. Information about the law firm that structured the offering and drafted the offering documents, and whether the firm is experienced with securities offerings. Seek Professional Advice In addition to satisfying yourself with respect to all of the items listed above, you should seek the advice of your own attorney, financial adviser or accountant regarding the investment. Your attorney should determine ...continued on page 8

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HOW THE DEAL GETS DONE. JASON WAXBERG Principal Broker

CHUCK BRAZER Broker

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Call 503.327.8237 www.equitypacificrealestate.com Rental Housing Journal April · March 2018

Rental Housing Journal Metro

10 Ways to Make Small Bathrooms in Your Rentals Look Bigger and Better

mall bathrooms in your rental properties can be made to look bigger and keep tenants happier with small, affordable changes in this maintenance checkup from Keepe Being able to enjoy a spacious bathroom is on the wish list of many tenants,. However many properties - especially rental unit clusters - are designed to optimize space. That means that the sheer size of a property’s rooms might have to be reduced to squeeze in extra storage space or living areas. While an extra small bathroom or powder room is certainly better than having one less bathroom in the property, it can be a hard point to sell, especially when a small bathroom is a property’s only bathroom. A room expansion or remodel is expensive, labor intensive and timeconsuming. It is also unlikely to be feasible for units that have been purposely designed to host certain numbers and types of rooms of specific dimensions.

No. 1 - Opt for white on white Avoiding dark, overly bright or coordinated color schemes is a must. Avoid contrasts and colors from emphasizing how small a space is by highlighting where the walls and/or ceiling end. White creates a spacious and airy feel. White also allows natural and/ or artificial light to illuminate the space as opposed to being absorbed by dark colored paints or wallpapers. No. 2 - Match tiles, walls and ceiling Matching the color of painted walls, tiling and ceiling erases the visible contrast that would result if they were of different colors. Uniformity and continuity of color makes the space look significantly larger, thus making more elaborate tiling patterns or color schemes an element to avoid. No 3 - Extend tiling If showers and other areas are surrounded by tiled walls, it’s ideal to extend tiling all the way up to the ceiling to avoid trims to “mark” a clear point on the walls and “shorten” them as a result.

No 7 - Use mirrors to your advantage Large mirrors can create an optical illusion that makes the room look larger. You can almost double the perceived space with them. Larger mirrors can be pricey, but generally still cost less than a tiled wall. This makes them an advantageous substitute.

doors give back this space as they slide open without taking up space from the room. No 6 - Use bright lighting in small bathrooms Poor illumination can make a small bathroom look dark and claustrophobic. The combination of bright lighting with the white color scheme of its surroundings creates an airy, fresh look.

No. 4 - Lengthen the space with vertical tiling Instead of opting for regular or squarelike tiles and laying them horizontally, choosing longer tiles and laying them vertically tricks the onlooker to perceive the space as being taller or wider than it really is.

No. 8 - Invest in sleek fixtures and furnishings Elaborate design elements are distracting and overwhelming is a small space. Modern bathroom fixtures and furnishings showcase sleek and harmonious lines, which work well with the minimalist look of uniform white paints and tiling to create an elegant space. No. 9 - Go with glass Instead of boring and cheap-looking shower curtains, opt for a glass panel for your shower. It modernizes and opens up the space by allowing for greater visibility past the “visual wall” that a shower curtain would create. For added privacy if preferred - glass paneling can be tinted or frosted. No 10 - Be smart about storage In small bathrooms, any extra room made available by eliminating “bulky” furnishings goes a long way. Adding floating vanities, shelving and wall cabinets maxmizes storage space while still maintaining a neat and polished look.

No. 5 - Save space with a new door Regular doors demand a certain radius of space available at all times to adequately swing open. This forces the layout of all elements within the space to accommodate the clearance. Sliding

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Form of the Month of Violation Form M040

Upcoming Events

4/10/2018

CAMT: Appliances Part I

4/10/2018

After the Boom

4/10/2018

Landlord/Tenant Part II

4/11/2018

CAM: Legal Responsibilities

4/11/2018

Law and Rule Required Course (LARRC) (Bend)

4/11/2018

HR Issues: Equal Pay

4/13/2018

It's the Law: Habitability Issues: The Grand Chess Game With Unreasonable Tenants

4/17/2018

CAM: Financial Management & Industry Essentials

4/18/2018

Spring Apartment Report Breakfast (Portland)

4/19/2018

Law and Rule Required Course (LARRC)

4/20/2018

Capital Planning

4/24/2018

CAMT: Appliances Part II

4/26/2018

Landlord Tenant Law (Eugene)

5/2/2018

Landlord Study Hall: Is it time to sell? Is greater cash flow possible? Increase profit? 1031 Exchanges and Exit Strategies

5/8/2018

Landlord/Tenant Part I

5/9/2018

HR Issues: Appropriate Workplace Behavior/Harassment

5/11/2018

It's the Law: Four Notices, One Envelope: How a Multiple Termination Notice Strategy Can Save the Day

5/15/2018

NSPF® CPO® 2 day Certification Class

Holding tenants responsible for violations of the Rental Agreement is one of the most critical roles of a landlord or property manager. The Notice of Violation form provides an easy template to take the initiative to enforce the rules to help maintain peace and order to your property. Although this form does not terminate the tenancy, it does assertively and politely remind the tenant of the violation and creates a useful written record your response.

Rental Housing Journal April · March 2018

President: Ron Garcia • Vice President: Phil Owen President Elect: Mark Passannante • Past President: John Sage Secretary: Lynne Whitney • Treasurer: Sandra Landis • Office Manager: Cari Pierce

RHAOregon President’s Message

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

Social and Economic Policy

by Ron Garcia

he City of Portland enacted its Renter Protection ordinance in February 2016, as a temporary emergency measure to address the city’s housing crisis. When they did this, they decided to leave exempted any owner with only one Portland rental unit from being affected. As this all occurred, there was a lot of discussion, but not an uproar. A lawsuit was filed against the city, however it lost in court. On March 7, 2018 the Portland City Council voted unanimously to both remove that single owner exemption, and also make the ordinance permanent. Additionally, they have signed off on a program requiring mandatory landlord registration, and there are many questions remaining as to what the collected data will consist of and for what purposes it will be used. Next on the list, per the mayor’s Residential Services Commission (of which I was formally a member, but resigned due to its overwhelming bias against landlords), three issues remain to be “accomplished”: 1. Revise and regulate landlords’ screening criteria, making it nearly

Rental Housing Journal Metro · April 2018

impossible to deny an application, under the guise of “disparate impact”. (In other words, the thinking is that felons and child molesters deserve housing too!) 2. Revise and regulate landlords’ security deposit requirements, capping the amounts that can be charged and regulating the way they must be refunded. (In other words, the thinking is that the pet stain left on your carpet, is only worth the 8 inch square, pro-rated amount of an already depreciated flooring material, and not the actual cost to replace the damage that was done.) 3. Create and foster a “regional” relationship with neighboring communities designed to make the ordinance consistent across city and county lines because the marginalized tenants most affected by the housing crisis are being pushed further away from the city’s core. (In other words, just because you own rentals in Beaverton, Gresham, or Milwaukie, etc. doesn’t mean you are safe from this rising tide.) While there was a lot of discussion last year at the state capital during the 2017 legislative session about the housing crisis, (HB 2004 was only narrowly defeated) it is notable that there was almost no mention of it in this year’s just-completed 2018

session. The reasons why are three-fold: 1. The same politicians that voted HB 2004 down are still in power this year. 2. The tenant activists look to this next election cycle and hope it will significantly change the make-up by 2019. (Democratic Senator Rod Monroe is largely credited with holding the line against rent control measure, and he is being aggressively challenged for his seat.) 3. The City of Portland has taken the lead to permanently change Landlord Tenant Law. You may ask, “What is really going on?” That’s a good question. We know that Portland is a “destination-city” with a worldwide reputation that will continue to attract new residents at a significant pace because of its “quality of life.” We know that Oregon is likewise a destination-state that continues to attract people nationwide to migrate here and live in the “Great Northwest.” Lost in the discussion is any real effort to help bring more housing units online faster with less regulations and fees. None of the testimony politicians rely on is coming from developers, builders, zoning, permitting or planning commissions who could actively and aggressively make changes and adjustments that would on-

board the thousands of housing units much needed in the coming years. Unfortunately, the ears of our elected officials have been plugged by an activistoriented tenants’ rights coalition, whose sole aim is to adjust the balance of power between renters and owners. They want to diminish private property rights and justify their actions by claiming discrimination and predatory practices (which, by the way, are already heavily regulated by local, state and federal laws). This is neither a liberal vs conservative nor a democrat vs republican debate. It’s not even a property owner vs renter argument. While these policies may provide temporary relief for a marginalized demographic of the tenant population, they are destined to make rental units even more scarce and more expensive, which in turn would only serve the current trend of thought to enact even more punitive legislation and thus continue the spiral. In other words, the solutions being adopted are bad economics for all parties. Look to any city that has rent control. San Francisco, New York City, and Seattle all have the highest rents in the country! Tenants are not winning even with these ...continued on page 14

Rental Housing Journal Metro

Dear Maintenance Men:

By Jerry L'Ecuyer & Frank Alvarez

Dear Maintenance Men: I own a small apartment complex that I manage myself. The property is starting to experience repetitive sewage backups. I’ve called the plumber several times and the problem is never resolved. The plumber is recommending the installation of a 4-inch main line clean out, running a camera down the line and few other things. It is all starting to sound expensive and I don’t know what to do. Why can’t the plumber just do the job right the first time? Bryan Dear Bryan: Your plumber is giving you good advice. Using the camera will determine exactly what the problem is and will help you decide the best course of action to solve your plumbing problem. We highly recommend adding an exterior mainline cleanout. In the long run, a 4-inch cleanout will save you money by making the plumber’s job easier to do. The plumber can run a larger snake without going on the roof or removing a toilet or disturbing the residents. The 4-inch clean-out is key to help keep your drains clear on a preventive maintenance basis. We would follow the advice of your plumber and get bids on: 1. Running a camera down the line to

the wall; cover the glass with a blanket or tarp and tape it to the top edge of the mirror. Be sure to cover the entire mirror top to bottom. You are now ready to remove the mirror and should it shatter, the blanket will contain the shards, protecting you and making the clean-up much easier. Dear Maintenance Men: What is the normal time frame for a one or two bedroom make ready? I have always heard the three-day rule to get an apartment ready for rent. My units seem to be on the three-week rule! How can I tighten up the process and turn my units faster? Martin determine the actual cause of your problem i.e. Roots, sewer line break, corroded pipe or cracks, etc. 2. Install a 4-inch main line clean out with street sweep and repair the sewer line as needed. 3. On a preventive maintenance basis, Hydro-jet annually to clean your main line. This work may not be cheap, but in the long run you will benefit from lower plumbing bills, late night emergency calls and happier residents.

Dear Maintenance Men: How do I safely remove a large mirror from a bathroom wall without shredding myself or my helper in the process? Tom Dear Tom: Removing a large piece of glass or mirror can be spooky. Safety first, be sure you are wearing eye protection, gloves and a sleeve long sleeve shirt or jacket. Next, use duct tape diagonally in both directions on the face of the mirror. This will help keep the mirror whole if it cracks or breaks. If the mirror is glued to

Dear Martin: The “Three-Day Rule” is a nice goal to strive for and can be done. But, most units are not in rent ready condition when we get them back from our departing residents. Here’s a useful time table and work schedule for a one or two bedroom apartment requiring complete paint, carpet, flooring, minor repairs, window coverings and cleaning. Day 1 & 2: Paint prep, trash out, minor repairs, removal of blinds, drapes, switch outlet plates etc. Day 3: Paint Day 4: Carpet/Flooring ...continued on page 8

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Apartment Owner Ordered to Pay $1.6 Million in Bed Bug Lawsuit

jury has awarded a California family $1.6 million in one of the largest single bed bug case awards ever reported against an apartment owner, according to a release. Liliana Martinez told NBC in Los Angles her family suffered for months with bed bugs at the Kahala Islander Apartments in Inglewood, California in 2010. She said her child, a baby at the time, was covered in bites. "Just seeing how he would scratch all the time and nothing would heal because it would start bleeding again. It was very emotional, very stressful," she told the television station. The family says they complained to apartment management and were told to throw out all of their furniture and sleep on the floor. But it took months to eradicate the bugs. The lawyer who represents the

the pest control operator left handfuls of chemical all over their belongings and carpet. When the plaintiffs complained about the chemical, the management told them there was nothing they could do, and they should vacuum a square area in their living room to sleep on with their 2 young children. Although they then agreed to change the carpet, it took them 3 months to do so, and all the while, the bed bugs were feeding and breeding in the carpet until it was changed. The family continued to receive bedbug bites the entire time.

apartment building declined to comment on the case. The defendant in the case, Amusement Six Apartments LLC owns an apartment complex in Inglewood and simply didn't

respond appropriately to the Plaintiffs complaints about bedbugs, according to Yahoo news. According to the suit, it took management 9 days to initially schedule bedbug treatment, and when they did,

Bed bug verdict the largest in U.S. Brian Virag, attorney from the law firm of mybedbuglawyer.com, obtained the $1.6 million verdict for the family and said in a release it was the largest verdict for a single family for bed bugs in the U.S. He ...continued on page 18

Front Door to Your Rental Property...continued from 1 wood varieties are naturally more resistant and sophisticated-looking, which contributes to their one-of-a-kind appeal and/or ability to last through the years without needing major attention. Premium varieties, such as mahogany or cedar, will be considerably pricier.

can be tailored to match countless designs, shapes and color schemes, while also being able to house additional decorative elements, such as glass mosaics and panels 2. Flexible price points - the unique natural look of wood can be accessible for most budgets as different varieties of woods are available at a variety of price points 3. Unique look - Many property owners and designers find wood to be worth the investment as it presents a naturally variegated and “high-end” refined look that other man-made materials cannot replicate Cons: 1. Weather-sensitive - wood is a material that is prone to be affected by its exposure to the weather and other environmental elements. Direct sunlight can fade the natural coloring of the wood, and high-moisture levels in the air (or from precipitation alone) can lead to warping and even rotting of the wood 2. High-maintenance - to ensure that the wood ages well and without being damaged by the natural elements discussed above, it’s essential to regularly treat the wood. Tinctures and sealants should be regularly applied by a reliable maintenance professional, which will be an added maintenance cost to consider. 3. High-price for top-quality - some

Steel front doors Pros: 1. Super safe - when it comes to property intrusions, reinforced steel doors are known to be safest against breaches, allowing for increased confidence in a property’s overall defenses against unwanted visitors. 2. Affordable but effective - when considering its wood and fiberglass counterparts, steel stands out as being far more affordable, while still offering the safety element that it shares with fiberglass and being much more lowmaintenance than wood and its issues with exposure and aging. Cons: 1. Insulation is not its forte - steel is a known conductor of heat and electricity, which makes it problematic when it comes to wanting to keep a property’s interior temperature at a set level. Steel will contribute to heating up the space when heated by outside temperatures and/or sunlight and will struggle to keep the cold out during the winter months. Insulating layers and treatments can improve this downside, but they will come at an added cost. 2. Denting - steel can easily become dented or chipped following impact, and this often results in unappealing marks that are difficult to completely erase. To effectively get right of the unappealing

Rental Housing Journal April · March 2018

look of those visible surface damages, an entirely new door might need to be purchased. 3. Rusting - while steel is not as sensitive to moisture as wood, it can easily rust over time as it is exposed to moisture and precipitation. Our experts encourage consulting the manufacturer to understand whether and how professional treatments can help Glass front doors Pros: 1. Unique look - solid glass doors can be made to match a great variety of preferred styles, with varying cuts, shapes and opacity available to be reproduced as desired. 2. Luminosity - glass allows natural light to enter the home like no other material can, which some property owners find to be a valuable addition to the look and feel of their property. Cons: 1. Fragility - experts agree that glass is naturally delicate even when it is reinforced, making it essential to be mindful of potential scratches, cracks and chipping that could easily occur. 2. Privacy - while some might be excited about the way glass allows for natural light to illuminate the home, some can be put off by the way glass makes it easy for passerby’s to peek inside a property 3. Questionable safety factor - glass door made for the purpose of being utilized as a property’s front door are generally reinforced to make it difficult for intruders to gain access by easily shattering the glass surface. This being said, glass remains rather fragile and much more easy to break than wood, steel, and fiberglass combined. Fiberglass front doors Pros: 1. Versatile - fiberglass paneling is manmade, which allows for creating a variety of unique textures and styles. Fiberglass doors can be made to resemble a natural wood grain, or also present smooth and glossy or matte and satin surfaces for distinguished coloring that can match a variety of architectural elements. 2. Resistant - many property owners

choose fiberglass front doors as opposed to wood because they are not vulnerable to discoloration and damage from exposure, while still closely resembling the look of wood. They are also more resistant to wear and tear than their steel counterpart. 3. Low-maintenance - these door should be maintained occasionally as they age, but they do not require sealants to be regularly applied, which does help with saving considerable amounts when it comes to maintenance expenses. 4. Secure - our experts confirm that fiberglass doors are just as secure as their steel counterpart, which allows them to stand strong and dent-free following forced impact 5. Efficient - while all door types can be treated to add insulating properties, fiberglass vastly surpasses wooden and steel door when it comes to insulation. While steel will always struggle with efficiently insulating and wood is vulnerable to temperature and humidity changes, fiberglass is not affected by any of these issues. Having optimal insulation can help ensure lower energy use and expenses as it allows for a property to easily remain hot or cool temperatures as desired. 6. Affordable - while aesthetic additions - such as integrated wood or glass decors - will rise costs, basic fiberglass door models are generally rather affordable. Cons: Pricey add-ons - fiberglass doors are fairly affordable, but can get expensive as they are further customized with the addition of decorative elements or coats. Keepe is an on-demand maintenance solution for property managers and independent landlords. The company makes hundreds of independent contractors and handymen available for maintenance projects at rental properties.

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Rental Housing Journal Metro

How Your Terms, Conditions Or Privileges Could Mean Discrimination By Ellen Clark

group, is treated unfairly or differently than others for a reason related to their membership in a certain category or group. In other words, if someone is treated in a different way than someone else because of the color of their skin, their age, their nationality, their ability to speak English (to name just a few) they are being discriminated against. A person does not need to be harmed to have been discriminated against—just treated differently.

he Grace Hill training tip of the week focuses on the issue of how your terms, conditions or privileges you provide prospective tenants and existing tenants could be discrimination under the Fair Housing Act. You must treat all prospects and tenants in a consistent way in how you use terms, conditions or privileges to avoid discrimination under the Fair Housing Act. Setting different terms, conditions, or privileges for buying or renting housing is a little less direct than other illegal practices, such as an outright refusal to rent or sell to an individual. But it is just as illegal. Requiring higher security deposits from families with children and demanding higher application fees from minorities are examples of discrimination in terms, conditions, or privileges. These practices violate fair housing laws. To avoid discrimination in terms, conditions or privileges, treat all prospects and residents fairly and consistently. 3 ways in leasing to be consistent and avoid discrimination If you require a photo ID from prospects to tour your community, be sure to get one from every prospect. No matter how non-threatening someone appears, it is important to require the same thing from all prospects. If a prospect’s rental application is denied, follow-up with them both verbally and in writing. Follow this exact procedure for every application that is denied. If you have a prospect who does not meet your income requirements but

you let her sign a lease by pre-paying six months’ rent, you should offer this option to other prospects in a similar situation. 3 ways in maintenance to be consistent and avoid discrimination If you charge one resident for a lock change, you should charge all residents the same amount for the same service. Respond to service requests in the order in which they were received. Faster response to emergencies is expected, but be sure to clearly define and document what constitutes an emergency service request. Document all correspondence with residents in your records. If you make an exception to any policy or procedure, make sure you provide the same information and options to all prospects and residents who are in the

same situation. Being consistent in how you apply policies and procedures will help you make a habit of treating all current and future residents fairly and equally. This will help you comply with the FHA, but just as importantly, it will create a more welcoming atmosphere for all people who meet your qualifications and wish to live in your community. Summary on consistency and discrimination The Fair Housing Act is intended to prevent housing discrimination. The Fair Housing Act describes a number of illegal practices relating to housing discrimination. One of these is discrimination in terms, conditions, or privileges. Discrimination is when a person, or a

Ellen Clark is the Director of Assessment at Grace Hill. Her work has spanned the entire learner lifecycle, from elementary school through professional education. She spent over 10 years working with K12 Inc.’s network of online charter schools - measuring learning, developing learning improvement plans using evidence-based strategies, and conducting learning studies. Later, at Kaplan Inc., she worked in the vocational education and job training divisions, improving online, blended and face-to-face training programs, and working directly with business leadership and trainers to improve learner outcomes and job performance. Ellen lives and works in Maryland, where she was born and raised. For nearly two decades, Grace Hill has been developing best-in-class online training courseware and administration solely for the Property Management Industry, designed to help people, teams and companies improve performance and reduce risk.

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Syndication Investing ...continued from 3

Dear Maintenance Men: ...continued from 6

whether the offering complies with applicable securities laws. A sponsor that disregards the applicable laws (or drafts its own documents) may expose itself and the entire investment to unnecessary civil or criminal liability, or it may be unaware of its fiduciary obligations to its investors. Your CPA or financial adviser should evaluate the financial merits of the investment based on past financial statements for the property and pro forma projections provided by the sponsor, as well as its suitability for your investment portfolio.

Day 5: Installation of window coverings, doorstops, switch/outlet plates, fixtures, accessories, toilet seat etc. Touch up paint if needed. Day 6: Cleaning – General cleaning including windows & final inspection. If you have done a pre-inspection of the unit before the resident moves out. You can plan what needs to be done before the unit is vacant. Organize the maintenance techs and contractors ahead of time. Have all the repair and replacement parts ready to go. The key is to plan each day and try to stick to the plan. WE NEED Maintenance Questions!!! If you would like to see your maintenance question in the “Dear Maintenance Men:” column, please send in your questions to: DearMaintenanceMen@gmail.com

Where Can I Meet Syndicators? Become a member of your local real estate investment clubs and attend their meetings on a regular basis, and attend the informational seminars offered by your self-directed IRA administrator. The discussion herein is of a general nature only and is not to be construed as specific legal advice, which requires the establishment of an attorney-client relationship and fee agreement. An issuer represented by securities counsel should rely on his or her own attorney’s advice with respect to the matters

discussed in this article. Kim Lisa Taylor, Esq., is founding attorney of Syndication Attorneys, PLLC, a boutique corporate securities law firm that helps clients nationwide with their federal real estate securities offerings. She has been licensed in California since 2002 and in Florida since 2012 and has made securities transactional law the focus of her practice since 2008. The firm employs one additional contract attorney with securities experience as well as other support staff. Kim and her team are available for consultation in St. Augustine, Florida.

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Bio: If you need maintenance work or consultation for your building or project, please feel free to contact us. We are available throughout Southern California. For an appointment please call Buffalo Maintenance, Inc. at 714 956-8371 Frank Alvarez is licensed

contractor and the Operations Director and co-owner of Buffalo Maintenance, Inc. He has been involved with apartment maintenance & construction for over 20 years. He is also a lecturer & educational instructor and Co-Chair of the Education Committee of the Apartment Association of Orange County as well as being Chairman of the Product Service Counsel. Frank can be reached at (714) 956-8371 Frankie@BuffaloMaintenance. com For more info please go to: www.BuffaloMaintenance.com Jerry L'Ecuyer is a licensed contractor & real estate broker. He is currently on the Board of Directors and Past President and past Chairman of the Education Committee of the Apartment Association of Orange County. Jerry has been involved with apartments as a professional since 1988.

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

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Rental Housing Journal Metro

Accommodating Disabled Tenants in Your Rental Property

s a property manager it is fundamental to understand the laws pertaining to disability and accessibility for prospective disabled tenants. The maintenance checkup from Keepe this week involves 15 maintenance ideas to make your property more accessible to disabled tenants. Researching and studying actual accessibility law should be a priority to prepare and protect yourself. The Fair Housing Act and the Fair Housing Amendments Act make it unlawful to reject a prospective tenant because of their disability as you know. However it also prohibits asking a prospective disabled tenant about whether they are disabled and about the nature of their disability, visible or not. While such questions are unlawful, the law allows for clarifying whether a prospective tenant qualifies for demanding a rental unit designed for disabled tenants only, or for a unit designed to accommodate certain disabilities in particular. Accommodations are a core element to accessibility law. The law states that disabled tenants may request reasonable accommodations to be provided, added or allowed for them to use and access their living space and common areas

within the property. Disabled tenants request for accommodation should be reasonable Accommodating Disabled Tenants In Your Rental Property The nature of the accommodation requested should exhibit a reasonable relationship to the disability. Such reasonable requests include allowing a service animal to live on the property or a designated parking space. To handle requests properly, it is fundamental to have an open discussion with a tenant

regarding their needs. Deciding what represents a “reasonable” request can be challenging considering that it can vary from case to case and property to property: the US Department of Housing Development requires a “interactive process" for reaching a reasonable compromise between a tenant and property manager/landlord/ owner, generally justifying the rejection of demands for certain accommodations only when they represent an “undue” financial burden.

Accessibility Through Property Modifications Requesting or making changes to a property fall into the category of “reasonable” requests that may or may not be granted. Before any modifications can be made, they must be approved by a property manager/landlord/owner in charge, who can ask the tenant to provide information regarding how proposed changes are necessary and/or ideal for them. State laws can also apply to residential requirements, and should be considered when handling a request for building modifications. Why You Should Invest In Accessible Modifications Accommodating Disabled Tenants In Your Rental Property Generally, unless a property is considered to be federally assisted housing, disabled tenants are expected to arrange and pay for necessary modifications to the property. This being said, the following 15 tips have been provided to make residential units safe and accessible for prospective tenants who are disabled or who have particular needs pertaining to mobility and access. ...continued on page 13

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Millennials Spend About 45 Percent of Income on Rent Before Age 30

new study based on Census data shows that millennials spend about 45 percent of their income on rent before reaching the age of 30, according to Rent Café. The cost of renting is a huge subject nowadays and a big expense as well, arguably the biggest it’s ever been. People in their 20s starting a life on their own have always faced a lot of challenges. Besides having a low income because of limited work experience, leaving home and paying rent make things even harder, according to Rent Café. “Analyzing Census data going as far back as 1974, we discovered that rent burden followed an ascending trend over time, making millennials the hardest hit generation. But the future doesn't look too bright for Generation Z either,” the company said in a release. Here are more key findings on millennials and rent Millennials pay a whopping $92,600 in total rent by the time they turn 30. Although they earn more compared to previous generations, they also have to spend more on rent. By the time Millennials might be thinking about buying a home or starting a family, they are struggling with rent and student loan debt instead. Compared to Baby Boomers (36%) and Generation X (41%), Millennials have to cope with a 45% rent burden in their 20s.

Because of the ever-increasing rents, discrepancies appeared within the same generation as well. With a rent burden of 47%, younger Millennials (20 - 29) surpass older Millennials who spent about 44% of their income on rent between the ages of 22 and 30. If this trend continues, Gen Z-ers are expected to pay something in the vicinity of $102,000 while in their 20's just to put a rented roof over their head. Summary: Given their overwhelming student loan debt, younger millennials may carry on renting, simply because the prospect of buying is not yet attainable. On the other hand, older Millennials are starting to slowly shift towards home ownership. As they are finally catching up with the American Dream, this will surely drive demand for homes for sale. Their lifestyle patterns so far show that Millennials need affordable homes with attractive amenities. As they’re starting to form families, they’ll soon be ready to put their hard-earned money into their own home. Methodology: RENTCafé is a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the United States. Using the most recent Census data, our research team analyzed the rents and incomes across the United States during certain time periods. Relevant income data was avail-

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able starting with 1974 while rent data was available starting with 1940. The income amounts represent the median gross income per capita and the rental amounts represent the historical median gross rents. The data was adjusted to 2017 prices, using a cumulative rate of inflation for each year. We based the total income on the following age brackets provided by Census: ages 15 to 24 and ages 25 to 34. We used the following year-of-birth ranges for each generation: Baby-Boomers – born between 1946 and 1964, Gen Xers – born between 1965 and 1976, Millennials – born between 1977 and 1995 and the Gen Z gen-

eration – born starting with 1996. We added up the data from an 8-year period for each generation (for the years they were aged 22 to and including 29), we calculated the median amount of money that each generation spent on rent and the median income they earned during the same period. The final data presented in this study was obtained by rounding up the numbers to the nearest hundred. The study refers only to single people paying the average monthly rent on their own.

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Rental Housing Journal Metro

Toys R Us ...continued from 2 stores will present companies with opportunities to broaden their footprint and gain market share in their respective industries. Fitness centers have been expanding at a rapid pace as they attempt to keep stride with the growing healthconscious community. Gyms act as a junior anchor for strip malls and power centers due to their propensity to increase foot traffic. Expanding grocery chains could potentially seek some of the dark locations as they are the ideal size for many companies. Grocer brands with traditionally larger layouts may also target the shuttered stores as they shift to smaller formats attempting to maximize sales per square foot. In 2017, supermarkets’ net store growth was the fifth highest out of 10 retail segments with 674 new locations. Discount retailers like Ross and T.J. Maxx are also feasible tenants as they have some locational flexibility due to their brandbased consumer appeal. Landlords to Adapt to Evolving Marketplace With retail continuing to evolve at a brisk pace, filling the soon-tobe vacant Toys R Us locations may require improvisation. The inability to occupy the entire space with one retailer may result in subdividing the space into multiple sections; however, bay depth could present a challenge. Converting retail assets to offices or last-mile distribution centers are also concepts that have generated interest in recent years as owners search for ways to adapt locations and maintain a steady revenue stream. The larger cobranded Toys R Us/Babies R Us stores, typically averaging about 65,000 square feet, could have particular appeal as lastmile fulfillment centers, depending on truck access, bay height and foundation structure capacity. Although uncertainty surrounding the filling of the eventually vacant locations is imminent, expect investors to capitalize on the new space coming to market and the demographics contributing to commercial real estate’s strength. The information contained in this report was obtained from sources deemed to be reliable. Every effort was made to obtain accurate and complete information; however, no representation, warranty or guaranty, express or implied, may be made as to the accuracy or reliability of the information contained herein. This is not intended to be a forecast

of future events and this is not a guaranty regarding a future event. This is not intended to provide specific investment advice and should not be considered as investment advice. Sources: Marcus & Millichap Research Services; CoStar Group, Inc.; CreditNtell; IHL Group; U.S. Census Scott M. Holmes Senior Vice President | National Director National Retail Group Tel: (602) 687-6700 | scott.holmes@marcusmillichap.com Prepared and edited by Brandon Niesen Research Associate | Research Services For information on national real estate trends, contact: John Chang First Vice President | National Director Research Services Tel: (602) 707-9700 | john.chang@marcusmillichap.com Price: $500 © Marcus & Millichap 2018 | www.MarcusMillichap.com

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Renters Feelings about Buying Diminish as Rates Climb amid Tight Inventory

here should be a continued good pool of renters for landlords as new research shows many renters feel now is not a good time to buy a home, as interest rates climb and the tight supply of homes for sale continues. Renters and rent payments are going to continue to grow as renters spent a record $485.6 billion in 2017, an increase of $4.9 billion from 2016, according to Zillow research. New consumer findings from the National Association of Realtors (NAR) show that while a growing share of households feel more confident about the economy and their financial situation, those positive feelings are not translating to positive views that now is a good time to buy a home. That's according to NAR's first quarter Housing Opportunities and Market Experience (HOME) survey, which also found that homeowners are increasingly positive about selling, and nonhomeowners have anxieties about saving for a down payment and qualifying for a mortgage. Renters feelings about buying diminish

Optimism that now is a good time to buy a home is at its lowest share in the past two years at 68 percent down from 72 percent last quarter. Among renters, feelings about buying are further diminished down to 55 percent from 60 percent last quarter. Those most optimistic about buying are homeowners, older respondents and those living in the more affordable Midwest and South regions. "The critical shortage of listings in most markets continues to spark a hike in home prices that is not easy for many buyers – and especially first-time buyers – to overcome," NAR Chief Economist Lawrence Yun said in the release. "Adding more fuel to the affordability fire is the fact that mortgage rates have shot up to a four-year high in just a few months. Many house hunters are telling Realtors® that they are dispirited by the stiff competition for the short number of listings they can afford." "There's no question that a majority of homeowners have amassed considerable equity gains since the downturn. Home prices have grown a cumulative 48 percent since 2011 and are up 5.9 percent through the first two months of this year," said

Yun. "Supply conditions would improve measurably, and ultimately lead to more sales, if a growing number of homeowners finally decide that this spring is the time to list their home for sale." Consumers feeling more upbeat about the economy and their financial situation Although optimism was a tad higher a year ago (62 percent), more households in the first quarter of this year (60 percent) believe the economy is improving compared to the fourth quarter of 2017 (52 percent). Homeowners, residents from the South and those from rural areas were the most optimistic about the direction of

the economy. Stronger economic confidence this quarter also led to households having

Accommodating Disabled Tenants ...continued from 10 These changes can be significantly beneficial. It can make a rental property particularly appealing for tenants who value living in an accessible and safe space. Considering that disability law is more lax and challenging to apply uniformly for residential spaces, disabled tenants will likely also value their ability to find a welcoming space that they can trust to accommodate their needs, often becoming long-term tenants. Finally, addressing accessibility improvements to a property in a proactive manner makes it possible to avoid being unprepared when a prospective disabled tenant makes requests down the road. 15 Maintenance Tips For Making a Property Safe And Accessible For Disabled Tenants 1. Repair or remove carpet flooring that has become loose, broken tiling and/or any kind of uneven, damaged pavement. 2. Pave all walkways and driveways to render them regular and obstaclefree. 3. Enlarge all doorways on both interior and exteriors to at least 36 in. wide 4. Consider installing automatic systems allowing remote opening of doorways, garages and gates 5. Install ramps on all multileveled access points; our experts encourage having a qualified urban planning professional inspect the property and recommend adequate placement of ramps 6. Replace door knobs with accessible flat handles 7. Install non-slip flooring in bathrooms, kitchens, exterior walkways and any other surface that is likely to become slippery when wet 8. Install grab bars in the bathroom, ensuring that they are placed at the

correct height and that can support the weight of an average adult 9. Consider installing particular accessible fixtures - such as toilets and showers - or begin by lowering toilets and lavatories. 10. Accessible faucets are ideally switched on by motion sensors 11. Light switches should be lowered to be accessible for wheelchair users, or substituted for a motion-sensing lighting system 12. Mailboxes should be lowered or substituted for accessible models 13. If the unit is furnished, furniture arrangements should allow enough clearance for users of assistive devices to travel around comfortably 14. Consider implementing Smart technology home system; Smart tech automates several in-home, everyday tasks, which renders them accessible. Additionally, Smart tech is generally a worthy investment as it is a unique and practical asset for most tenants regardless of ability. 15. Upgrade to a side-by-side refrigerator: especially if your property is due for replacing outdated appliances - which is a beneficial investment considering that most newer appliance models feature energy-saving features - sideto-side refrigerators are ideal as they allow easy access to both refrigerating and freezing compartments Keepe is an on-demand maintenance solution for property managers and independent landlords. The company makes hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area,

Rental Housing Journal April · March 2018

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Rental Housing Journal Metro

Confused Over Service, Assistance and Emotional Support Animals? By Ellen Clark The Grace Hill training tip of the week focuses on the confusing issue and definitions of service animal, assistance and emotional support animals. You probably hear the terms service animal, assistance animal, and emotional support animal a lot. But do you really know what these terms mean? If not, you are not alone! There are three laws that relate to rental housing and service and assistance animals: The Fair Housing Act (FHA) Section 504 of the Rehabilitation Act of 1973 (Section 504) The Americans with Disabilities Act (ADA). The FHA applies to almost all rental housing. Among other things, it prohibits discrimination based on disability and requires housing providers to make reasonable accommodations for people with disabilities, such as making an exception to a no-pet policy or a breed restriction. Housing that receives federal financial assistance from the U.S. Department of Housing and Urban Development (HUD) must also comply with Section 504. Like the FHA, Section 504 prohibits discrimination based on disability and requires housing providers to make reasonable accommodations for people with disabilities.

ADA. Consider these important takeaways: You cannot deny a reasonable accommodation request because an animal does not meet the ADA definition of a service animal. Under the FHA and Section 504, reasonable accommodations must be granted for assistance animals, which include service animals, emotional support animals and companion animals. Residents making accommodation requests are not required to use specific terminology. If an animal works, assists, or performs tasks for the benefit of a person with a disability or provides emotional support that alleviates one or more symptoms or effects of a person’s disability, it doesn’t matter what term someone uses, it is an assistance animal under the FHA and Section 504. Whereas the FHA and Section 504 prohibit discrimination in housing, the ADA prohibits discrimination based on disability in all areas of public life, including schools, transportation, and all public and private places that are open to the public. What does this mean for you in relation to support animals? The ADA requires you to let service dogs accompany their owners in any area of the community that is open to the public, such as the leasing office. These laws use different terms and

definitions, which can be confusing. The ADA uses the term “service animal” and defines it specifically as a dog trained to do work or perform tasks for people with disabilities. The FHA and Section 504 use “assistance animal” as a broad term to describe any animal that works, provides assistance, or performs tasks for the benefit of a person with a disability or provides emotional support that alleviates one or more symptoms or effects of a person’s disability. Under the FHA and Section 504, service animals, emotional support animals, and companion animals are all considered assistance animals. An assistance animal may be any type of animal and is not required to have specific training. The ADA uses the term “service animal” and defines it specifically as a dog that has been individually trained to do work or perform tasks for people with disabilities. Emotional support animals, companion animals and animals other than dogs (and sometimes miniature horses) are not considered service animals under the

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RHAOregon President’s Message ...continued from 5 claimed social victories. And that’s what this is: A socialist type of power grab which is taking place right now in our community, hurting the very people it claims to be advocating for. If this sounds like hyperbole, visit the tenant group websites and social media blasts and observe their claims and tactics. You may wonder, “What happened to that lawsuit against the City of Portland (Owens v City of Portland)?” The update is that it was filed for appearance in the State Court of Appeals and is due to be heard in the next few months. The Plaintiffs believe it has a very good chance of succeeding. Finally, you may consider “What can I do, as a landlord?” Consider this: The tide isn’t turning. It turned. However, in

the spirit that it’s better late than never, I believe we have an obligation to unite against bad social and economic policy. I recommend visiting MoreHousingNow. org and donating a year’s profit from your properties to help reverse the political momentum that has built up. (Yeah, I know, “a year’s profit?”! I hear you… it just ain’t the same as it used to be!) Sincerely, Ron Garcia President, RHA Oregon •

Rental Housing Journal April · March 2018

Rental Housing Journal Metro

20 Easy, Affordable Maintenance Projects to Update your Rentals

he smaller maintenance jobs that improve the look and feel of a rental space and make it feel welcoming can really help when it comes to landing that next tenant is the maintenance checkup from Keepe this week. This week’s post will list easy and affordable maintenance projects to update every room. These small improvements and investments really go a long way. 5 front and outdoor improvements 1. Repainting the front door - a fresh and crisp coat of paint does wonders for a property’s exteriors, especially when opting for bright or bold colors. Due to its exposure, the front door can be prone to discoloration and chipping, and a new coat of paint

can completely transform it into a cheerful and appealing detail. 2. Replacing the property’s numbers - Over time, those number sets can rust and look worn. Replacing the existing set with a new one is inexpensive and makes the exteriors look neat. 3. Sanding and refinishing railings - Harsh weather and temperatures can take a toll on metal fences and railings. Rust, oxidation and discoloration are unappealing, but can be easily taken care of by sanding, repainting and sealing. 4. Resealing and treating wooden fences - Wood fences and gates are prone to rotting, discoloration and moss growth. Regularly sealing and treating the wood not only prolongs its life by protecting it from

moisture and the elements, but also restores the beauty of a uniform and natural-looking finish. 5. Repainting or replacing mailboxes - Tenants will notice and appreciate the look of their updated mailbox, and will be even more excited about having newer models installed, as those offer include safe features for protecting your tenants mail. 5 easy kitchen ideas 1. Installing a fun and modern backsplash - a tiled backsplash protects the exposed walls from moisture and staining from food spills and splashes, while also making the space look more appealing. Most hardware and home improvement stores offer a great variety of tiling combinations for backsplashes,

which are generally rather inexpensive while also being highly customizable and adaptable to the existing color schemes and features of a kitchen. 2. Updating cabinet and drawer handles - Swapping handles with newer and slightly more elaborate ones is a very easy and inexpensive hack that makes the space look more appealing and curated. 3. Turning recessed lighting into accent lighting - A maintenance professional can modify existing recessed lighting into hanging lighting, which can completely transform the space by adding a distinguishing accent with a touch of color. 4. Sleek-ifying and modernizing appliances with a coat of liquid stainless-steel -

Having a painting expert recoat your appliances with a kitchensafe liquid stainless steel paint makes outdated or discolored appliances look modern and sleek. 5. Adding molding on top of cabinets - Molding makes the space look polished by giving cabinets a custom, built-in look. Different styles of molding exist to match different decors. 5 bathroom maintenance projects 1. Restoring grouts - Over time, tiling can look worn and dirty as the grout becomes stained and collects dirt over time. A tiling professional can easily scrape off old grout and regrout the space, which makes it look clean and neat. ...continued on page 18

Ultimate Cleaning Solutions specializes in apartments move-in and move-out cleaning services. We will make sure that your vacated apartment or rental property is ready for the next client. First impression is important and therefore, our goal is to help you show your prospective client a polished, clean and inviting apartment! Ultimate Cleaning Solutions can make a vacant apartment, or office “move-in” ready by cleaning everything from top to bottom. You can feel confident that we are busy returning your rental to showcase condition. We are ready to help you! Our services include move in/move out cleaning services to apartment community managers and individuals owning rental property. We are your one-call apartment turnover solution.

You can contact us at: 503-521-7458 or office@ultimatecleaninginc.com Rental Housing Journal April · March 2018

Rental Housing Journal Metro

How a No Pet Policy can be Discriminatory By Ellen Clark The Grace Hill training tip of the week focuses on the issue of how a no pet policy can be discriminatory when it involves potential tenants with disabilities. Landlord and property managers must make reasonable accommodations to meet the needs of people with disabilities. An accommodation is a change in any rule, policy, procedure, or service if the changes are needed for a person with a disability to have equal opportunity to occupy and enjoy full use of their housing. One of the most common accommodation requests people with disabilities make is to have an animal that would otherwise be restricted by a community’s rules.

No pet policy should specific an exception Unless a no-pet policy specifies an exception for assistance animals, it may be considered discriminatory to residents with disabilities who might require an animal for assistance. Consider this case: The owner of several apartment complexes and rental homes in San Jose sent a letter to residents stating that he did “not like to deal with pets of any kind” and that residents could not “introduce any new pet or replacement pet.” In a civil complaint, The California Department of Fair Employment and Housing (DFEH) accused the property owner of discriminating against residents with disabilities. The property owner

settled with DFEH for $100,000. As part of the settlement, the owner will undergo in-person training annually for three years and must develop a new reasonable accommodation policy. Interestingly, the owner must also provide semi-annual reports to DFEH about the number of requests for accommodation and the nature and outcome of those requests. Read more about the case here. What can you do to avoid finding yourself in a similar situation? Ensure that any no pet policy or prohibition against pets, whether verbal or in writing, makes a specific exception for assistance animals as reasonable accommodations for residents with disabilities. Remember that assistance animals

are not pets. Rather, they provide an important service to people with disabilities, and you must handle these accommodation requests in compliance with the law.

the lives of millions of Americans, more U.S. households are headed by renters than at any point since at least 1965, according to a Pew Research Center analysis of Census Bureau housing data. While recent trend pieces point to historical data suggesting an upcoming stagnation in the apartment market, with nearly 39 million Americans (1 out of every 8) calling apartments home, it’s becoming increasingly difficult to refute the demand for apartments. However, the increase in U.S. renters over the past decade does not necessarily mean that homeownership is undesirable to today’s renters. Indeed, in a 2016 Pew Research Center survey, 72% of renters said they would like to buy a house at some point. About two-thirds of renters in the same survey (65%) said they currently rent as a result of circumstances, compared with 32% who said they rent as a matter of choice. When asked about the specific reasons why they rent, a majority of renters, especially nonwhites, cited financial reasons.

for a down payment. Limited income (47 percent), student loan debt (30 percent), and rising rents (28 percent) were the top three obstacles cited, followed by health and medical costs (14 percent). Only 14 percent also said that nothing was holding them back from saving for a down payment. Non-homeowners were also asked for the potential reasons why qualifying for a mortgage would be difficult. Income uncertainty (45 percent), a low credit score (34 percent) and too much debt (26 percent) were mentioned the most. Twenty-nine percent said they lacked the financial knowledge or did not know the first step needed to qualify.

Summary: According to The Case for Fair Housing: 2017 Fair Housing Trends Report by the National Fair Housing Alliance, of all reported complaints of housing discrimination in 2016, nearly 55% involved discrimination against people with disabilities. That’s a staggering statistic. Make sure your no pet policy is not an issue. •

Rates Climb amid Tight Inventory...continued from 13 improved feelings about their financial situation. The HOME survey's monthly Personal Financial Outlook Index2, showing respondents' confidence that their financial situation will be better in six months, rose from 59.1 in December to 63.8 in March. A year ago, the index was slightly lower (62.6). "The jump in optimism to start the year can be attributed to the robust job creation in most of the country, as well as the larger paychecks households are

enjoying because of faster wage growth and the recent tax cuts," said Yun. "These three positives should further ignite buyer demand. However, several metro areas with the healthiest labor markets also have the most severe supply and affordability pressures. This troublesome reality is what's dampening moods and keeping many would-be buyers at bay." More households headed by renters than at any point in 50 years A decade after the housing bust upended

Income, debt and anxiety hold back renters from buying In this quarter's survey, nonhomeowners were also asked about the barriers preventing them from saving

About NAR's HOME survey: In January through early March, a sample of U.S. households was surveyed via random-digit dial, including a mix of cell phones and land lines. The survey was conducted by an established survey research firm, TechnoMetrica Market Intelligence. Each month approximately 900 qualified households responded to the survey. The data was compiled for this report and a total of 2,702 household responses are represented.

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Application of Payments and 72 Hour Notices by Brad Kraus Attorney at Law Warren Allen LLP

see it at least once a week. Bewildered landlords painfully discovering recently enacted laws governing how and where to apply tenants’ payments. I’m talking about ORS 90.220(9), affectionately known as the “application of payments statute” in the ORLTA. Believe it or not, due to this statute, many of those landlords’ Non-Payment of Rent Notices may have been defective, without them even knowing about it. Prior to ORS 90.220(9), any payments received from tenants could be applied in manner described in the Rental Agreement. If the Rental Agreement was silent, the Landlord could simply “fill the bottom of the barrel first.” In amending ORS 90.220, the legislature forced Landlords to apply payments received by tenants in a predetermined order. Pursuant to ORS 90.220(9), any payments received from your tenants must now be applied as follows: “A. Outstanding rent from prior rental periods; B. Rent for the current rental period; C. Utility or service charges; D. Late rent payment charges; and E. Fees or charges owed by the tenant

under ORS 90.302 or other fees or charges related to damage claims or other claims against the tenant.” At first glance, the statute is pretty straightforward. However, when put into practice, the statute causes waiver problems galore, especially when tenants carry arrearages from one month to the next. A simple example will illustrate the waiver problem: Terry’s monthly rent is $1,000.00. If Terry pays only $500.00 in January, and the Landlord accepts it, a partial payment has been created. If Terry thereafter pays $1,000.00 in February, $500.00 of that would first go to January’s outstanding balance. The remainder could then either be applied to February’s rent (thereby creating another partial payment issue) or returned pursuant to ORS 90.414 (thereby preserving the Landlords Non-payment termination rights under ORS 90.394). Simple enough… right? Not so fast! Here’s where it could get complicated . . . Terry’s monthly rent is $1,000.00, but Terry also owes the Landlord utilities every month (and hasn’t paid them for over 10 months, causing a utility arrearage of $600.00). Terry also hasn’t paid his rent on time for the past 10 months, incurring a $100.00 late fee each month. Accordingly, Terry’s ledger balance, including his January and February unpaid rent, is

$3,600.00. Yikes! Let’s say that Terry tenders a payment of $1,500.00, which the Landlord accepts. The Landlord wrongly assumes that, due to Terry’s large balance, $2,100.00 (of the $3,600.00 balance) is still owed for rent. Accordingly, the Landlord serves a Non-Payment of Rent Notice, Terry fails to cure, and the Landlord files an FED. The parties then appear at the First Appearance, and a Tenants’ attorney appears on Terry’s behalf, demanding a dismissal (due to the waiver problem) and $750.00 in attorney’s fees. Unfortunately, the Tenant’s attorney’s position is legally sound, and the Landlord is in trouble . . . Why? Remember, due to the application of payments statute, the first $1,000.00 applied to January’s outstanding rent due. The remaining $500.00 then applied to February’s outstanding rent, regardless of how much money Terry owed. Maddening, right? So what can be done to prevent such a disastrous outcome? While every situation must be analyzed on its own merits, some best practices can be articulated. First, Landlords must know how the application of payments statute works in practice. This can be difficult when the Landlord’s ledger software merely throws payments at the oldest (or total) balance. Second, Landlords should protect themselves

(and their books) by serving valid For Cause notices. Third, if the Landlord desires to accept a partial payment, the parties should execute a partial payment agreement, in order to protect the Landlord. Finally, prior to service of any Non-Payment of Rent notice upon tenants who carry a substantial balance, Landlords should look at their ledger and determine whether or not, in the current month, a payment of larger than the outstanding previous months’ rent was made. If so, the application of payments statute may negate the Landlord’s ability to serve a Non-Payment of Rent Notice, and a For Cause notice may be the only remaining option. While it’s difficult to discuss and outline every possible way ORS 90.220(9) can complicate your life, knowing that the statute exists is half the battle. Once you acclimate yourself with the statute, and understand its practical effects, you can better protect yourself from potential waiver issues. •

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Rental Housing Journal Metro

Millenials'... Driving Change...continued from 15 2. Restoring caulking - Just like grout, caulking in sinks, tubs and showers can stain and start looking worn or even moldy over time. Recaulking resolves this issue while updating the overall look of the bathroom. 3. Sealing cracks - Cracks are not a pleasant sight on tiling and fixtures, making them look worn and damaged. They can be concealed by being filled in with sealant. 4. Upgrading showerheads and faucets - Installing a new showerhead and faucet set modernizes and updates the space while also treating your tenants to the enjoyable features of newer showerheads models, such as improved water pressure settings and even integrated lighting. 5. Covering exposed bulbs - Exposed light bulbs aren’t particularly appealing, actually making space look rather unpolished. Plenty of inexpensive lighting fixtures are available for purchase, and can be installed over exposed bulbs to improve the look of the space.

5 ideas for living rooms, bedrooms and home offices 1. Upgrading or replacing baseboards - Like molding for cabinets, baseboards polish and add a finishing touch to the interior of your property. They can be a helpful addition as they protect walls in high-traffic areas from abrasions and contact, but can easily start looking worn if left unmaintained for long periods of time. Repainting, repairing or replacing older baseboards completely uplifts the spaces where they are installed. 2. Repainting the interior walls Spring and Summer are the ideal time for scheduling major painting projects, as the weather and temperatures are typically paint-friendly. Refreshing the walls with a new coat of paint or opting for a new color is one of the most immediate ways to update the look and feel of the unit, especially considering that some walls can be prone to staining and discoloration over time. 3. Deep-cleaning carpet and sealing hardwood - Both procedures will restore

flooring to a like-new condition, which will make the unit feel and look clean and cared-for. 4. Replacing outlets - Swapping older outlets with newer, multi-outlet and usbfriendly models modernizes the unit and lets your tenants to enjoy their practicality and efficiency. 5. Considering smart gadgets - Smart home systems with integrated hightech gadgets offer a variety of innovative ways to make units more efficient and comfortable. Some of the more popular systems include voice-controlled task assistants, user-friendly energy-use monitors, intelligent thermostats and interactive lighting. Maintenance Summary: Prioritizing functional maintenance jobs such as gutter cleanings, plumbing and HVAC checkups, emergency repairs, preventative inspections is fundamental maintenance. However, minor maintenance projects for the improvement of its aesthetic qualities should not be

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underestimated or forgotten. Often times, investing in smaller projects that tackle the aesthetics of a property seems superfluous because they are not repairing or improving the actual amenities, which are the distinguishing factor attributing value to a property. While it’s definitely smart to prioritize functional maintenance jobs, home improvement projects can also add some serious value to a property. Improving the look and feel of a space not only makes the overall unit look more appealing, but it can help with making up for those elements that might be lacking or slightly outdated. Aesthetic improvements showcase attention to detail and make tenants feel good about living in a place that looks well-kept and welcoming. Keepe is an on-demand maintenance solution for property managers and independent landlords. The company makes hundreds of independent contractors and handymen available for maintenance projects at rental properties

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Bed Bug Law Suit...continued from 7 represented the family of four including a 3-year old boy and a 3-month old baby girl who were all bitten by bed bugs. His clients were all exposed to bedbugs between July and October of 2012. The case was Liliana Martinez Et. Al. v. Amusement Six Apartments LLC. The young boy, Jorge Maravilla Jr., who was 3 years old at the time of the bedbug exposure was covered in bed bug bites. He has significant residual scarring to the day. The jury awarded Jorge Jr. $880,000. This is the fifth landmark verdict obtained by Virag in the last 12 months that included a 3.5-million-dollar verdict against PLB Management, and a $546,000 verdict in October against the Hilton Garden Inn in Rancho Cucamonga, CA, whose clients were exposed to bed bugs for a one-night hotel stay. Sixteen former and current residents of one of Los Angeles' largest apartment complexes won a $3.5-million verdict over an infestation of bed bugs in their units last year, Virag told the Los Angeles Times. Park La Brea Apartments, a sprawling complex with more than 4,000 units in the Miracle Mile District, was found liable by a jury in Los Angeles Superior Court late Friday afternoon, said attorney Brian Virag, who represented the plaintiffs. •

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Rental Housing Journal April · March 2018

Rental Housing Journal Metro

Mold Preventative Maintenance ...continued from 1 reasons—up from 59 percent just two years ago. Numbers higher for millennials and multifamily While 67 per say renting is more affordable there are three points to keep in mind according to the research from Harris and GFK research: • That number is significantly higher for millennials (aged 21-37), jumping 15 points from 59 percent in 2016 to 74 percent. • Multifamily renters (versus single-family renters) expressing this view jumped eleven points - from 57 percent in 2016 to 68 percent today. • And although this increase takes place in all geographic areas, urban renters are increasingly likely to continue renting for financial reasons. Overall the study shows a significant majority, 64 percent, of renters cite price as the most important factor when considering their next home, a theme consistent across all generational cohorts.

Additionally, renters living in the West perceive homeownership as more difficult to attain than other regions, with 51 percent believing homeownership is less accessible than three years ago. Rental satisfaction continues to run high. A significant and growing majority of renters – 66 percent – are satisfied with the overall rental experience, up from 60 percent in August of 2017. Even among renters who have experienced a rent increase in the past two years, a growing number – 64 percent – stated they do not plan to move, up from 49 percent in August 2017. This includes a noteworthy 70 percent of Baby Boomers. In addition, a majority of renters – 54 percent – continue to believe that renting is a good choice for them now, including 71 percent of millennials. •

Renters In The West Face Price Increase Issues The study also shows renters living in the western United States with increasing issues related to affordability and the cost of living. Those living in the West feel the impact of rent increases more than other regions, with 64 percent saying they are now spending less on other essentials due to changes in their rent—which is at least nine points more than any other region.

Rental Housing Journal April · March 2018

Rental Housing Journal Metro

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Rental Housing Journal April · March 2018