Rental Housing Journal On-Site March 2016 by Professional Publishing, Inc

Rental Housing Journal On-Site

March 2016

9. Residential Property Management – A Great Career Opportunity

3. Landlord–Tenant Q&A: Fair Housing 4. Fair Housing Facts & Tips

10. Rents to Flatten in 2016

5. Legislative Roundup 7. Dear Maintenance Men – Water Heaters, Paint Prepping and Swimming Pools 8. Ask the Secret Shopper – Ready Vacants

11. Why Buy Earthquake Insurance? 15. Maintenance Summit Education Conference and Tradeshow

www.rentalhousingjournal.com • Professional Publishing, Inc 17,000 Papers Mailed Monthly To Puget Sound Apartment Owners, Property Managers & Maintenance Personnel Published in association with Washington Association, IREM & Washington Multifamily Housing Association

4Q15 Market Overview

Commercial Real Estate Experts

Multifamily Housing Update

Seattle, WA Payroll Job Summary Total Payrolls Annual Change RCR 2016 Forecast RCR 2017 Forecast RCR 2018 Forecast RCR 2019 Forecast RCR 2020 Forecast Unemployment (NSA)

1,624.1m 45.0m (2.9%) 33.0m (2.1%) 35.5m (2.2%) 32.3m (1.9%) 23.2m (1.4%) 20.1m (1.2%) 4.7% (Dec.)

4Q15 Payroll Trends and Forecast U.S economic growth ground nearly to a halt during 4Q15, and the high flying Jet City labor market was not immune to its centripetal force. Payroll growth ebbed to a 45,000-job, 2.9% year-on-year rate, slowest since spring 2014. Much weaker expansion in the construction, manufacturing and techheavy information services sectors was principally responsible as these industries slowed to a 2,200-job collective annual growth rate from 2Q15’s 14,100job pace. Signs of softer growth in the tech services niche also were evident. By contrast, momentum accelerated in the government and socially-funded

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Moderate Expansion, Easing Prices Expected in 2016

espite various global and domestic hurdles hindering economic growth, steady job gains and stable leasing demand should help keep commercial real estate activity expanding in 2016, according to the authors of an annual report published jointly by Situs Real Estate Research

Corporation (RERC), Deloitte and the National Association of Realtors®. According to the report, Expectations & Market Realities in Real Estate 2016—Navigating through the Crosscurrents, commercial real estate activity is forecast to gradually grow this year with demand for space holding steady

across all commercial sectors. While commercial property values and price gains are expected to flatten after surpassing 2007 peaks in some major markets, investors will still benefit from the strong income flows generated from new and existing leases. continued on page 11

EPA Cracks Down On Lead Violations

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

ate last year the Environmental Protection Agency (EPA) announced it took action against 75 renovation contractors and others to protect people from harmful lead dust and debris exposure, as required by federal Lead-based Paint Renovation, Repair, and Painting (RRP) regulations. These cases show EPA is cracking down on businesses and renovators who ignore federal requirements that have been in effect for several years now. These requirements apply to many repairs and renovations done to painted surfaces in homes and daycare facilities built prior to 1978. Pre-78 properties are of concern, as they are a major source of lead exposure that can cause lead poisoning, especially in our nation’s young children. The RRP Rule, which is part of the federal Toxic Substances Control Act, is intended to ensure that owners and

occupants of pre-1978 “target housing” and “child-occupied facilities” receive information on lead-based paint hazards before renovations begin, that individuals performing such renovations are properly trained and certified, and that renovators follow specifically prescribed lead-safe work practices to reduce the potential for exposure to lead for all, including workers. Renovators are required to give the pamphlet to property owners and occupants within 60 days before starting a renovation. Housing providers, similarly, have obligations to notify residents prior to covered repairs and renovations, to share informational literature with them, including a disclosure form, and to be lead-safe certified or hire a contractor who is. To protect yourself and your investment, it’s important, that you assure the contractors you hire are in fact lead-safe

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certified and complying with the EPA’s safe work practice requirements. To learn more about what repairs are covered and what these work-safe practices are, visit http://www.epa.gov/sites/production/files/documents/renovaterightbrochure.pdf. The EPA reported that rough twothirds of the cases they recently settled involved failure to obtain EPA certification prior to conducting renovations. Over half the cases were related to violations of required safe work practice standards. The EPA states its aim in seeking penalties against RRP violators is to help deter other violations and to level the playing field for companies that do follow the law. Such fines and settlements help eliminate the financial advantage a continued on page 22

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Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

Landlord–Tenant Law Q&A Fair Housing

by Evan L. Loeffler, Loeffler Law Group PLLC

What rules do I need to follow to comply with anti-discrimination policy related to military personnel tenants?

Two of the most important rules related to tenants in the military have to do discrimination when screening for tenancy and allowing tenants in the military to break a rental or lease agreement. The Washington Law Against Discrimination prohibits housing discrimination on the basis of military status—including honorably discharged veterans. As a protected class, military personnel may not be treated differently or denied access to housing because of their military status. See: RCW 49.60.222. Penalties may apply for repeat offenders. Tenants in the military and their dependents may terminate a tenancy for a specified time without penalties if the tenant receives reassignment or deployment orders. The tenant is required to provide notice of the reassignment or deployment orders to the landlord no later than seven days after receipt. A month-to-month tenant in the armed forces may terminate a lease with less than 20 days’ notice if reassignment or deployment orders do not allow for twenty days. See: RCW 59.18.200(1)(b).

Q. We want to change our 16-unit apartment complex to a “no pets” property. What if one of the tenants has a service animal? A. Washington State law says, “A landlord’s no-pet policy cannot be applied to the dog guide or service animal of a person with a disability.” Service animals are considered part of the tenant—not a pet—so think of a guide dog as a furry set of eyes. If the animal is trained to assist a tenant with his or her disability the landlord must provide a reasonable accommodation. This may include allowing the tenant to keep the animal. Keep in mind, however, the animal is not a pet. The landlord may not charge a pet deposit for a reasonable accommodation. The law regarding companion animals and emotional support animals is constantly changing. It is best to

Rental Housing Journal On-Site · March 2016

consult with a lawyer or other legal resource to ensure compliance.

Q. My tenants are threatening to file a harassment suit because I entered the unit to inspect. What is harassment and how do I protect myself? A. Harassment is a gross misdemeanor, so it is a criminal matter. A private person may not bring a civil action for harassment. A person is guilty of harassment who threatens to cause bodily injury, threatens to cause damage to personal property, threatens physically restrain a person, or threatens to take an action intended to substantially harm someone. See: RCW 9A.46.020(1) (a). A tenant may, however, ask a civil court for an “anti-harassment” order against a landlord if the landlord is regularly intruding on the tenant’s right of

privacy. If the landlord violates the order, criminal charges may be brought. If you receive a restraining order or anti-harassment order, contact your attorney immediately. To avoid any such dispute, landlords must be aware of their rights of entry. The law allows a landlord access to the leased premises with at least 48 hours’ prior notice for the purposes of inspection or repairs or 24 hours’ notice for the purposes of showing the premises to a prospective purchaser or renter. (No prior notice is required in the event of an emergency.) The notice should be in writing, provide the date and approximate time of entry, and provide contact information so the tenant may notify the landlord if the access needs to be rescheduled. If the landlord abuses the right of entry, or if the tenant refuses access unreasonably, fines may be assessed and, in extreme cases, the tenancy may be terminated. Do you have a landlord-tenant law question you’d like to see answered in this column? Send it to Landlord-Tenant Answers at fax@loefflerlegal.com. Evan L. Loeffler is the principal attorney at the Loeffler Law Group PLLC, a Seattle-based firm emphasizing landlord-tenant relations and litigation throughout Washington State. He is a regular author and speaker on issues related to landlord-tenant law. www. loefflerlawgroup.com

Rental Housing Journal On-Site

Fair Housing Facts & Tips

he Fair Housing Act protects people from discrimination when they are renting, buying, or securing financing for any housing transaction. The Fair Housing Act specifically cover’s discrimination because of race, color, national origin, religion, sex, disability and the presence of children. (Provided by HUD)

Fair housing laws prohibit illegal housing discrimination. Discrimination is illegal in any housing situation if it is based on, or adversely affects, a “protected class.” That is, if someone is denied a home, is treated differently, or is harassed because of one of the reasons listed below, it is illegal. Consistency is Key! 1. Remember to be consistent within your daily job performance & Interactions when dealing with residents, prospective residents and their guests 2. Never make assumptions regarding a. Disabilities b. If an animal is a companion or pet c. Treat everyone the same! Discrimination is sometimes deliberate or unintentional due to lack of Fair Housing knowledge toward residents, prospective residents & their guests that fall into any protected class category More often than not discrimination occurs during the leasing process while dealing with prospective residents. BE CAREFUL!

The information and purpose of leasing and Fair Housing is not to scare you out of the industry. It is an extremely important part of the job performance and expectation. Fair Housing classes will give you the understanding of pitfalls of falling into possible discrimination in Fair Housing. It also prepares and gives the tools necessary to help avoid complaints.

Here are a few examples that occur during leasing: Example: Oh my, your children are beautiful! I have the perfect home for you on the ground floor by the playground! I am so excited to show you this apartment Intention: More than likely the leasing associate has the best intentions for the prospective residents, it is still DISCRIMINATION. Perception: This is discrimination in the form of Steering, and could prompt a complaint. Correct Action: Anyone applying for an apartment can live in any available unit and must be show the same apartments as anyone applying Prevention: EDUCATE, EDUCATE, EDUCATE! It is necessary to make certain that the associates working for you are knowledgeable and trained to minimize the risk to you and your company Discrimination is Discrimination! Unfortunately, even the best of intentions of the leasing consultant can put them, the owner and Management Company at risk. Make no mistake,

Fair Housing and discrimination is real and happens.

Ignorance Of The Law Is No Excuse! Learn about the Federal, State and Local protected class on The Fair Housing website http://fhco.org

My best advice is Document, Document, and Document!

Documentation How does documentation have the potential for a complaint? Example: You may have a star on one guest card and not another or you may have written she is so sweet make a great resident! Intention: You really liked that prospect and really thought they would make a great resident and noted as much on their guest card Perception: This could be construed as discrimination base on the fact that these types of doodles and or comments were not present on all guest cards. These guest cards would be brought into question should a complaint be filed Remember not to doodle or make marks on applications, guest cards or any paperwork related to prospect or resident Fair Housing Laws apply to: • Owner / Agents • Property Management Companies • Maintenance, Leasing & Administrative staff • Outside Vendors such as Landscapers, Painters,

• Exterminators, Insurers, etc. • Real Estate Agents, Brokers, Lenders • Homeowners & Condo Associations • Individuals, Corporate & Business Owners • Architects, Builders, Developers, Engineers • Responsibility is non-delegable • Ignorance of the law is no excuse A couple of thoughts, ask your associates and how they would address these scenarios in the leasing process? (In red are common answers and or thoughts your will receive from the well intentioned leasing associates and are discriminatory, in my experience during training) • Women with 2 young children? Do not make assumptions! . This women and children will be quite, I can put them upstairs • Married couple with 2 teen aged boys? . Those boy are going to be trouble • Married couple with 1 teen aged girl? . Quite residents

Discrimination is real and can be prevented! by Dana Brown – EDGE Training – Full Spectrum Residential Services, LLC danabrown3321@gmail.com or 503-740-8432

Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

ith approximately three more weeks of work in this year’s regular session, legislators and pundits are narrowing in to the critical needs of the state, in order to end the 64th legislature. We will see both houses produce supplemental budgets this week, with Democrats likely pursuing new revenue through the elimination of tax exemptions. Republicans in the Senate have vehemently opposed the raising of any new taxes, and have pushed resolutions requiring two-thirds majority to eliminate a tax exemption. At the same time, any hope of new tax revenue through a carbon tax, is gone for this year. While nobody has seen the new revenue projections, rumors are abound that the state is looking at a $200 million shortfall in health care funding from last year. After the policy cutoff, Landlords are only left with a few policy bills in play for this legislature. The house version of the Source of Income discrimination, HB 1565 is awaiting a hearing from Senate Human Services Committee. RHA and its industry allies agreed to work with stakeholders to increase the availability of subsidized housing, instead of creating a new cause of action. They now met twice with Housing Authorities, with another scheduled meeting in late April. The last meeting was with a statewide sampling of public housing, and did not include the tenant advocates. The most interesting takeaway was that some housing authorities

Legislative Round Up

know and admit that when they issue a section 8 voucher, that many of those individuals are automatically disqualified from renting the housing authorities own unit due to civil, credit, or criminal history. While it is politically convenient to say that voucher holders can’t find housing because of the economy and discrimination, even the advocates concede that they are giving out vouchers to individuals who have little hope of finding a workable unit. Senator Fain’s housing affordability tax exemption legislation continues to move through the legislature, now with increased attention from media around the state. City of Seattle lobbyists continue to defend their unwillingness to pursue more aggressive policies in the face of overwhelming opposition in the legislature. While most Washingtonians understand that policies must be

crafted in accordance with all members of our representative body, some Seattle politicos cannot understand the culture outside their own city, and continually demand for progress on rent control in Olympia. Now that we are finally past the policy cutoff, those voices must pivot their complaints to new venues, and will be looking to integrate their housing needs perspective into the upcoming election cycle. Fain’s bill SB 6239, will likely pass quickly in the next few weeks. Good news on the squatters bill 5894, sponsored by Sen. Tim Sheldon. The bill passed out Ina struck party line out of the Senate and has a hearing tomorrow morning (2-23) at 10 AM. YakimaValley landlords will be present to testify. I have a meeting with Democrat leaders tomorrow after the hearing to review amendment language, that will

hopefully give us a bill that can get to the Governor’s desk. Finally, a bill that would allow local governments to implement a $20 increase on civil filing fees in superior court has passed the house and awaits action in the Senate. The fees would pay for increases in dispute resolution programs, which do not provide RHA any value, but do reduce the general operating costs of courts. Because of the positive fiscal impacts of these programs, the bill is supported by some Republicans who normally oppose court-funding increases. RHA is working alongside judges and other business interests to stop the bill from passing the Senate.

National Housing Conference Notes Also, the National Housing Conference held a webinar to discuss the upcontinued on page 19

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Rental Housing Journal On-Site

4Q15 Market Review ...continued from page 1 health care and education services sectors, where year-on-year job gains advanced about 10% to an 11,400-job rate. Sluggish 2H15 global and domestic growth gave rise to a material downward tilt in RED Research’s base line U.S forecast for 2016. Quarterly average GDP growth now is expected to evolve at about 1.8%, down nearly –0.3% from the November projection. Growth is expected to be especially weak during 1H16 (1.6%). Our model estimates a 2% chance of negative SAAR GDP growth 2015 vs 2016. RCR still expect Seattle job growth to top the national average, but job creation in 2016, and in the near recessionary 2019-2020 period is likely to be unusually slow. Job growth in each of the next three years will most likely hover in the high-1% to low-2% range; however, the forecast out-years may fall considerably lower than this. Occupancy Rate Summary Occupancy Rate (Reis) 94.7% RED 50 Rank 39th Annual Chg. (Reis) -0.6% RCR YE16 Forecast 93.6% RCR YE17 Forecast 94.6% RCR YE18 Forecast 94.5% RCR YE19 Forecast 94.2% RCR YE20 Forecast 94.3%

4Q15 Absorption and Occupancy Rate Trends Seattle renters absorbed a healthy 5,832 vacant apartments in 2015, including a 17-year high fourth quarter net of 2,257 units, according to Reis, yet

it was not enough to keep pace with a torrent of supply. Developers completed 7,531 units last year and 2,806 units during 4Q15. As a result, occupancy slipped -20 basis points sequentially and -60 bps year-on-year to 94.7%. With a slowing economy and even more supply projected for 2016, conditions are likely to grow worse before they improve next winter. Axiometrics surveys of 505 larger, stabilized properties found a higher 95.1% rate, down only -10 bps y-o-y. The total market rate was 94.7%. Class-C (95.4%) recorded highest occupancy for the second consecutive quarter, topping former champ class-B by 20 bps. Class-A trailed on 94.5%. North and West Seattle posted the highest rates (96.1%); supply-heavy Kirkland and Downtown lagged. The RCR SEA demand model relies on supply growth (+), S&P500 returns (+), vacancy (+) and rent (+), job (+) and home price (-) growth as independent variables. The 94.7% adjusted R2 model sees weaker 1H16 absorption, deluged by record supply, but gradually improving conditions after. Occupancy is likely to dip to 93.6% before recovering. 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

$1,313 8.3% 2nd 2.5% 4.1% 4.3% 2.9% 2.4%

4Q15 Eﬀective Rent Trends Reis surveys found continued strong rent momentum in the Seattle rental market during 4Q15, recording average sequential and year-on-year growth of $13 (1.0%) and $101 (8.5%), respectively, to $1,313. Comparable 4Q14 sequential and 3Q15 y-o-y gains were 1.2% and 8.5%. Sequential gains exceeded 1% in every submarket save Renton, while three submarkets (Downtown, Kirkland and Tukwila) topped 6%. Axiometrics market analysis of stabilized same-store assets uncovered a 9.2% y-o-y average advance, up from 8.6% in the prior quarter. Class C properties continued to rack up impressive growth, rising 11.1% to class-B’s 9.8% and class- A’s 4.7%, leading among classes for the eighth consecutive quarter. Ten submarkets chalked down double-digit growth, led by Kent (15.4%), while supply heavy Downtown (4.7%), North (6.5%) and Kirkland (4.2%) lagged materially. The relationship between supply and rent is becoming clearer. The RCR rent model incorporates it with a sharply negative coefficient for vacancy rate. The model also uses job (+), income and home (+) price growth and BAA-rated bond yields (-) as independent variables to achieve a 97.1% ARS (SE=0.36%). The model forecasts a sharp deceleration in 2016 to 2.5%, followed be a nice rebound in 2017-2018. Trade & Return Summary $5mm+ / 80-unit+ Sales 26 Approximate Proceeds $1,179mm Average Cap Rate (FNM) 4.8% Average Price / Unit Expected Total Return RED 46 ETR Rank Risk-adjusted Index RED 46 RAI Rank

$219,661 5.9% 33rd 4.42 19th

4Q15 Property Markets and Total Returns The metro property market maintained a blistering pace as 26 investment sales were recorded during 4Q15, up from 25 and 24 in 3Q15 and 2Q15, respectively. Totals sales also advanced, rising from $1.1 billion in 3Q to $1.2bn. The average price of traded units declined -9.8% to $219,661, attributable to an increase in the average property age from 23 years to 25, and possibly a small up-tick in average cap rate. Private equity and fund manager investors continued to dominate the ranks of buyers, although a large public REIT also participated, closing on a class-B+ Capitol Hill mid-rise priced at ~$495/ sf, according to CoStar. RCR estimate a pro forma cap rate in the low-4% area. Recent construction trophies continued to trade in the 3.9% - 4.3% range. Class-B suburban gardens are priced at yields about 50 bps behind, although Redmond and Bellevue assets are valued at trophy property levels. Class-B/C properties mostly command 5.5% to 6% yields. For valuation purposes, RCR left the purchase cap proxy stable at 4.75%. Property values are projected to fall -3% in 2016, before recovering lost ground next year. Unlevered total returns are projected to average 5.9% over a 5-year hold, down from 7.7% last quarter due to our outlook for weaker job- and stronger supply-growth. The 33rd ranked R46 total return estimate compares to a 6.7% group mean.

By Daniel J Hogan

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

continued on page 13

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Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

DEAR MAINTENANCE MEN Water Heaters, Paint Prepping and Swimming Pools

Dear Maintenance Men: I just replaced a water heater and boy are they expensive! What are some tried and true ways to extend the life you a water heater or recommended preventive maintenance tips? Since I’m starting with a new heater I want to make this one last as long as I can. Fred Dear Fred: There are a number of things you can do to extend the life of a water heater, be it gas, electric, new or old. At least once a year, plan on flushing the tank to remove calcium deposits. First shut off the gas or breaker, let the water cool. Drain the tank and flush with a steady stream of water from the cold water inlet and let the water and debris drain from the drain valve until the water runs clear. If you have a 100 gallon or larger tank, use the clean out port to remove the calcium deposits. Removing the deposits keeps your water heater from working overtime. The more deposits in the tank, the harder the burner needs to work to keep the water hot. Equally important is checking the “Anode Rod”. The anode rod is a long sacrificial zinc or magnesium rod that protects the metal tank from corrosion. This rod should be checked yearly and replaced every 3 to 5 years. The rod can be found at the top of the tank and is

Dear Maintenance Men: I am getting ready to paint my property and noticed a lot of mold or mildew in the shaded areas. I am worried that scraping these areas when we prep for paint will cause the mold spores to spread. What do you recommend we do as prep for painting? Marty,

held in place by a hex bolt head. To check the rod, turn off the water supply and let the water cool. With a wrench, turn the hex bolt at the top of the tank and lift the rod out. If the rod is smooth and white in color, it is fine and can be reinserted ready to be inspected again in a years’ time. If the rod is corroded, brown, or looks like a rusted nail or missing all together; it is time to replace it. (Actually, it is well past time to replace it.) A new anode rod can be

found at any plumbing supply house. If you have a low ceiling above the water tank, ask for a flexible rod to ease the installation. Smear Teflon pipe thread sealant on the threads of the new rod before you install it. Don’t use tape, since it can reduce the effectiveness of the rod. Keep in mind that replacing the anode rod on a regular basis (every 3 to 5 years) could easily double the life of your water heater.

Dear Marty: One item on your paint prep work will be finding the cause of the mold or mildew in this part of the building. Check for excess moisture in the ground, walls or even a poorly placed sprinkler head. Trim any bushes or trees that stop air flow or cause too much shade in these areas. The best way to remove the mildew safely is to use a power washer with a soapy solution that contains a mildewcide. Once the building is cleaned properly with the power washer, regular prep work can begin and the property painted. Dear Maintenance Men: I have just purchased an apartment property with a swimming pool. The pool is in very poor condition and I continued on page 19

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Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

SK THE SECRET SHOPPER Ready Vacants

hile market conditions remain strong, there may be times when you find yourself in a situation where you have no apartments to show. Maybe you don’t have a model or you’re in a make ready process with the vacant apartments that are available. Here is the question:

I know I shouldn’t show an apartment that isn’t ready, but I hate to ask someone to come back. Everyone is so busy I just don’t think they’ll make the time to come back for another visit. What can I do?

First of all, you do not have to show an apartment in order to rent one. While many people are “visual” and having a model or vacant apartment to show may seem like an advantage, it is not the only sales tool you have at your

disposal. Here is what can happen when there is no apartment available to show: With a diagram of a 2 bedroom, the consultant “walked me through” the apartment as though we were inside. She used the terms “you” and “yours” during the entire “visual” tour. She pointed out the various storage areas, and also showed me the shelf and cabinet over the washer and dryer. The consultant used descriptive words like “oak cabinetry” and “spacious breakfast bar.” She mentioned the wood-burning fireplace and vaulted ceilings, and pointed out the fireplace and indicated where the ceiling begins to get higher. The consultant also helped me visualize what type of furniture would fit in each room. When the apartment “presentation” was completed, the consultant walked me over to the location of the upcoming apartment. She pointed out and described the amenities we saw along

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the way and discussed the proximity of each one to the apartment. She indicated where I and my guests could park. Standing outside the apartment, the consultant pointed out other advantages to this location. She drew my attention to the private patio, nearby fountain and lush landscaping. She also mentioned the friendly neighbors upstairs and next door. Once the leasing consultant confirmed I was pleased with what I had learned about the apartment and community, she asked if I would like to put a hold on the apartment until it was ready to view. When I declined, she told me she understood my hesitation since I had not actually seen the apartment. However, she reminded me it was the only one she had coming available; without a deposit she couldn’t hold it for me. As I continued to hesitate, she told me my deposit would be fully refundable if I did not like the apartment once I saw it. As you can see, having no apartment to show did not hamper the leasing consultant’s ability to sell AND close the sale! In fact, it was quite the opposite: She became even more creative in selling her product! She had the oppor-

tunity to go the extra mile and “create a visual,” and she took advantage of it. The prospective renter in this situation got a more comprehensive tour when there was no apartment available to show! Remember: You only get one chance to make a good first impression. Selling what you have to offer will increase your leasing ratio. Rather than demonstrating a dirty apartment or asking the client to come back, put your product knowledge to the test: Give a thorough presentation with whatever sales tools you have at your disposal, and then close the sale. Once you rent that last vacant apartment sight unseen, you will have the confidence to prelease all those upcoming notices . . . If you are interested in leasing training or have a question or concern 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 Provided by: Joyce (Kirby) Bica Former owner of Shoptalk Service Evaluations Consultant to Jancyn Evaluation Shops E-mail: shptalk2@gmail.com Copyright © Joyce (Kirby) Bica

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Rental Housing Journal On-Site · March 2016

711 Powell Ave. SW, Suite 101 Renton, WA 98057 (425) 656-9077 • (425) 656-9087 (fax) admin@wmfha.org

Executive Director - Jim Wiard Treasurer - Sheri Druckman

Board President - Brett Stevens Vice President - Becky Sanders Vice President of Suppliers Council - Rob Pendleton Immediate Past President - Kris Buker

Secretary – Laura McGuire

Residential Property Management A Great Career Opportunity

n February, the Washington Multi-Family Housing Association was honored to hold their annual Emerald Awards celebration in the Seattle/Bellevue area and in Eastern Washington in Spokane, attended by 1,250 total industry members. The Emerald Awards provided companies with an ability to recognize their most accomplished employees and rising stars. Employee recognition and a simple acknowledgment of a job well done are unfortunately too often overlooked in our industry. WMFHA received over 350 nominations for these prestigious industry awards. 40 awards were given out to industry representatives, such as for Community Manager of the Year, Leasing Consultant of the Year, Maintenance Technician of the Year, and may other recognition awards. The camaraderie, support and congratulations extended to the award nominees, finalists and eventual award recipients transcended company pride and brought our entire industry together for the purpose of celebrating the industry we love and giving back to others who share the same aspirations. Our front-line employees, from groundskeepers and maintenance service technicians to leasing agents, assistant managers and community managers, are the faces and voices of our industry. They are the ones who meet and serve our residents and prospective residents. They support their families and aspire to build a long term careers in property management. This is a service industry – a people business. Everyone needs a good, safe, quality home to live in, raise a family, grow a stable career, enjoy their pas-

sions and contribute to a community. The rental housing industry helps people live in a home that’s right for them. In April, WMFHA will hold its first ever Career Fair, allowing job seekers an opportunity to meet with companies looking to bring new talent to our industry. April has been designated Residential Property Management (RPM) Careers Month, and April 5th will be National Apartment Housing Day. There has never been a better time to start a career in residential property management. Demand for rental housing is growing rapidly, and so is the need for talented, creative, and passionate people to help build strong communities. RPM is a meaningful, robust, dynamic, and highly professional field, dedicated to helping people choose and enjoy the housing lifestyle that’s right for them. At our EdCon Education Conference and Exhibition in March, one of the classes will be presented by several leaders in our industry. The class will be providing insight into how a company can create a culture of employee appreciation and development. Employees and their “human capital” are a companies’ greatest resource, but need to be managed with a strategic goal outcome to contribute to the success of each employee, thereby ensuring success for the company. Companies need to invest in their employees’ growth and knowledge. WMFHA’s April Maintenance Summit education conference and trade show for apartment maintenance service professionals allows an opportunity for participants to expand their skill base and better serve their owners and residents. Companies that support their

employees’ skill development and professionalism reap the rewards of a higher performing employee and lower employee turnover. In conjunction with the National Apartment Association Education Institute, WMFHA provides several national designation programs such as Certified Apartment Manager (CAM), National Apartment Leasing Professional (NALP) and Certified Apartment Portfolio Supervisor (CAPS). Earning a designation provides the skills, knowledge and credentials to create career advancement opportunities. Companies that support their employees’ attendance at these educational classes see greater productivity and enhanced bottom line return. Many professional property management companies have employee retention policies that allow for educational reimbursement dollars for employees who advance their careers by taking professional classes such as those that WMFHA provides. We recommend that you review your company employee manual to see if such financial reimbursement policies exist for your benefit. This month, a contingent of WMFHA members and staff traveled to Wash-

ington D.C. to meet with our Members of Congress and discuss issues of importance to our industry. We advocated for sound policies that promote the ability of our properties to serve our residents. Senator Maria Cantwell was particularly supportive. She expressed her gratitude for the great work we are doing, particularly in efforts to expand affordable housing, house veterans and their families, and to work with the homeless agencies in cities plagued by high homeless population. The efforts of our collective contributions to the fabric of society are understood and appreciated by many key policymakers, but unfortunately, not all lawmakers. We will continue the grassroots advocacy efforts on behalf of everyone supporting quality rental housing. Remember to thank your on-site employees, as often as possible, for the great work they are doing. For more information about the Washington Multi-Family Housing Association, our educational opportunities, networking events or legislative efforts, or to sign up for membership, go to www.wmfha.org or call us at 425656-9077.

Almost 250 people gathered at the beautiful Davenport Grand Hotel in Spokane on February 25th for the first annual Eastern Washington Emerald Awards! At this elegant luncheon event, ten Emerald trophies were awarded in eight categories. Please join us in congratulating the following 2016 Emerald Award Recipients. Leasing Agent/Assistant Community Manager of the Year Presented by Zillow Group Rentals Desiree Vick - Greystar Maintenance Technician of the Year Presented by Compass Construction Jeff Hill - Black Realty Management Industry Partner of the Year Presented by Washington Multi-Family Housing Association Aalpine Services Co. Volunteer of the Year Presented by Washington Multi-Family Housing Association Michele Davis - ForRent Media Solutions Curb Appeal Presented by Washington Multi-Family Housing Association Island View Apartments - Avenue5 Residential Community of the Year Presented by ForRent Media Solutions Lofts at Innovation Center - Prodigy Property Management Maintenance Supervisor of the Year Presented by Alliance Flooring 1-175 Units: Alan Christensen - Madrona Ridge Residential LLC. 176+ Units: Tom Clark - Greystar

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Rental Housing Journal On-Site

Rents to Flatten in 2016

fter years of record rent appreciation, Zillow’s rental forecast shows relief in sight for cashstrapped renters.

Ore. and Denver. Rents in San Francisco saw 12.5 percent appreciation in 2015. Zillow forecasts rent in San Francisco will grow half as fast in 2016 -5.9 percent. • National median rent at the Even with the slowdown, rents will end of 2015 was $1,381, and is remain unaffordable in many of the expected to increase slightly to major markets across the U.S., espe$1,396 over the next 12 months. cially on the West Coast. Renters in San • The slowdown in rents means Francisco and Los Angeles can expect that, by the end of the year, they to spend 40 percent of their income on will be rising at a slower pace a rental paymentiii. than incomes in many markets. “Hot markets are still going to be hot in 2016, but rents won’t rise as quickly • In December, home values rose as they have been,” said Zillow Chief 4 percent to a Zillow Home Economist Dr. Svenja Gudell. “The Value Index of $183,500. slowdown in rental appreciation will Rent appreciation will level off over provide some relief for renters who’ve the next 12 months, slowing to an an- been seeing their rents rise dramatically nual rate of 1.1 percent by December every single year for the past few years. 2016, according to the new Zillow® Rent However, the situation remains tough Forecasti. The national Zillow Rent In- on the ground: rents are still rising and dexii at the end of 2016 is projected to renters are struggling to keep up.” be $1,396 -- compared to $1,381 in DeThe slowdown in rental appreciation cember 2015. indicates that supply of new multi-famZillow is forecasting a decrease in the VALLEY, ily homes isMETRO, catching upARIZONA to demand. rate of rental appreciation amid a rent- Substantial new housing supply is beal affordability crisis that has renters in coming available in Atlanta, Denver, some markets spending almost half of Portland, Seattle, and other markets. their income on rent. Some of the fastThe Zillow Home Value Index rose est growing metros had double-digit 4 percent year-over-year in Decemannual rental appreciation at the end ber 2015, to $183,500, according to the of 2015. Zillow® December Feb, Apr, Jun, Aug, Oct, Dec Real Estate MarZillow expects rental appreciation to ket Reportsiv. slow down most significantly in Nashville, Tenn., San Francisco, Portland, continued on page 21

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Rental Housing Journal On-Site

Why Buy Earthquake Insurance? By Cliff Hockley, President, Bluestone & Hockley Real Estate Services

any of our clients have asked us over the years if they should purchase earthquake insurance. This is a difficult question to answer specifically because every property is constructed differently (i.e. wood, masonry, concrete, metal) and is located on different soil(i.e. clay, rock, sand). The height of the building also makes a difference. Imagine the impact on a one story building versus a thirty story unreinforced masonry building. The age of the building, and the code requirements in every state and city, need to be taken into consideration as well. Most importantly, building owners want to know what risks their buildings face located in the Cascadia subduction zone, a seismic area that encompasses the coastal areas of Northern California to Vancouver Island and inland to I-5.

The Impending Risk In the cover story in the July 2015 edition of the New Yorker Magazine titled,“TheReally Big One: An earthquake will destroy a sizeable portion of the coastal Northwest.”Author Kathryn Schulz pointed out, “we now know that the odds of the big Cascadia earthquake happening in the next fift y years are roughly one in three. The odds of the very big one are roughly one in ten.” Chris Goldfinger, professor and paleoseismologistat Oregon State University, is an expert in seismic and tectonic studies and one of the main sources of the New Yorker article. In 2011, he also

authored a comprehensive study on the Cascadia subduction zone for the US Geological Survey based on 13 years of research that exposed a pattern of earthquakes reflected in the region’s earthquake history. “Over the past 10,000 years, there have been 19 earthquakes that extended along most of the margin, stretching from southern Vancouver Island to the Oregon-California border,” Goldfinger noted in a 2012 OSU news release on the paper. “These would typically be of a magnitude from about 8.7 to 9.2 – really huge earthquakes. We’ve also determined that there have been 22 additional earthquakes that involved just the southern end of the fault,” he added. “We are assuming that these are slightly smaller – more like 8.0 – but not necessarily. They were still very large earthquakes that if they happened today could have a devastating impact.” Jay Patton, a co-author on the study, added, “By the year 2060, if we have not had an earthquake, we will have exceeded 85 percent of all the known intervals of earthquake recurrence in 10,000 years. The interval between earthquakes ranges from a few decades to thousands of years, but we already have exceeded about three-fourths of them.”The last major earthquake along the Cascadia subduction zone was estimated to have occurred in approximately 1700.

Commercial Real Estate Experts ...continued from page 1 The fift h annual release of the joint report draws on the three organizations’ respective research and expert analysis and offers an objective outlook on commercial real estate through forecasts and commentary on the current economy, capital markets and commercial real estate property markets. A research-based assessment of the office, industrial, apartment, retail and hotel property sectors is also provided. “Historically low interest rates, especially in treasuries, combined with commercial real estate’s stable prices and value make this asset an attractive investment,” says Ken Riggs, president of Situs RERC. “Looking into 2016, the commercial real estate market should moderate, which could stabilize prices.” Vacancies are expected to continue to decline slightly in 2016 for all property types, except in the apartment sector, where they are forecast to increase modestly by the end of the year as more new project completions come onto the market. Continued job growth, demand exceeding supply and limited new construction (outside of multifamily) should lead to rising rents and steady investor returns, which overall will shift away from capital appreciation as price growth levels off in many markets.

Continuing on the same slow trajectory seen for many years, the U.S. economy – facing headwinds from a rising dollar, financial market volatility and geopolitical concerns – is forecast to grow at a rate of 2 percent to 3 percent in 2016, which is stronger than most global economies and enough to generate around two million net new jobs over the next year. Deflationary pressures related to low gasoline and energy prices are expected to diminish by mid2016, in part because of robust growth in apartment rents. “Supported by solid hiring in most parts of the country, the demand for ownership and rental housing will continue to increase in 2016 despite another year of meager economic expansion,” says Lawrence Yun, NAR chief economist. “While supply shortages will weigh on housing affordability and push home prices and rents higher, the housing sector will keep the U.S. economy afloat and lead the residential investment component of GDP growth by up to 10 percent this year.” SOURCE National Association of Realtors

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4Q15 Market Review ...continued from page 6

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.

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Rental Housing Journal On-Site

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Rental Housing Journal On-Site · March 2016

WFMHA’s 2016 Maintenance Summit Education Conference & Tradeshow Exhibition

Maintenance Summit Education Conference and Trade Show Exhibition Hosted by the Washington Multi-Family Housing Association Featuring the Maintenance Mania® competition

Wednesday, April 27th, 2016 • 8:30AM – 4:00PM Tukwila Community Center – 12424 42nd Ave. S, Tukwila, WA 9818 Join your service team peers for a day of hands-on education and skill building classes in plumbing, electrical repair, appliance repair, pools, painting techniques, moisture detection, management skills and More! Make your way around the trade show floor and visit with the best products and services vendors in the industry. Support your industry and others in your profession. Learn new valuable service techniques that can be implemented at your property to benefit your owner and residents. Ask any property manager and they will tell you—Service Teams are the backbone of the multifamily industry. Day-in and day-out, our Maintenance Techs, Groundskeepers, Lead Techs and Maintenance Supervisors keep our residents happy and our properties running smoothly. In recognition of the valuable role they play, the National Apartment Association (NAA) commenced its nationwide maintenance competition, Maintenance

Mania®, and the Washington Multi-Family Housing Association said, “Bring on the heat!” The day concludes with the Maintenance Mania competition, with an opportunity to qualify for the national Maintenance Mania competition in Las Vegas at the National Apartment Association Education Conference. Racing against the clock, you will compete against each other to see who is the fastest in eight maintenance-focused challenges. The finale of the event concludes with a race car competition, where the competitors build a model car using at least one maintenance product or part and race it down a pinewood derby-style track. Cash prizes are offered for top times, including a $750 bonus for the best overall time. “Maintenance professionals are essential to the success and viability of the multifamily housing industry,” said NAA President Doug Culkin, CAE. “NAA is extremely proud to be able to shine a light on such an outstanding group of individuals through the Maintenance Mania® program.”

EDUCATION – TRAINING – TRADE SHOW – MAINTENANCE COMPETITION

2016 Maintenance Mania Events

2016 Maintenance Summit

There are eight events that are standard for all Maintenance Mania® programs. Each race is open to every Maintenance Mania® participant. 1. AO Smith Water Heater Installation 2. CFG Faucet Installation 3. Fluidmaster Duo Flush Toilet Conversion

Featuring the Maintenance Mania Competition!

4. Kidde Fire & Carbon Monoxide Safety Installation 5. Frigidaire Ice Maker Installation 6. Kwikset Key Control Deadbolt Test 7. Seasons Ceiling Fan Installation 8. Motorola and Niagra Conservation Race Car Competition *To qualify for the National Championship, you must complete all eight events

ONE LOW PRICE GETS YOU INTO EVERYTHING!! – $89 | Members $109 | Non-Members Hot breakfast & lunch included!!

Event Timeline Time 8:00 – 8:30 8:30 – 9:00 9:00 – 10:00

Event

Room

Registration/Breakfast Trade Show Floor Opens Technical Courses Meeting Rm A Classroom B Social Hall Banquet A/B/C

10:00 – 10:30 Visit the Trade Show Floor 10:30 – 11:30 Technical Courses Meeting Rm A

Dave Alfano, HD Supply Lance Shippy & Chris Blamire, Roto Rooter

Whirlpool Appliance Repair (Refrigerator)

Randy Kruger and John Ybarra, Whirlpool Corporation

Safety On Site

Dave Alfano, HD Supply

Emerging Technologies in Electrical: GFCIs and Dane Sydow, Essex Property Trust AFCIs in Apartment Homes

Social Hall

Disaster Preparedness

Banquet A/B/C

Whirlpool Appliance Repair (Washers/Dryers)

Banquet A/B/C

4:00

Basic Pool Maintenance and Equipment Plumbing Repair Techniques & Tips Debunking the Myths about Mold and Mildew

Speaker

Classroom B

11:30 – 12:00 Visit the Trade Show Floor 12:00 – 12:30 Lunch 12:30 – 1:30 Technical Courses Meeting Rm A Classroom B Social Hall

1:30 – 2:00 2:00 – 4:00

Class

Raejean Kreel, Tukwila Fire Dept. Randy Kruger and John Ybarra, Whirlpool Corporation

Service Team and Office Team Coordination Touchdowns in Leadership Jessica Fern, FPI Tips & Tricks Of The Trade Whirlpool Appliance Repair (Dishwasher & Randy Kruger and John Ybarra, Whirlpool Ranges) Corporation

Visit Trade Show Floor Maintenance Mania Competition Awards, Prizes, Wrap Up

Rental Housing Journal On-Site · March 2016

WFMHA’s 2016 Maintenance Summit Education Conference & Tradeshow Exhibition

Class Descriptions & Speakers

2016 Maintenance Summit Education Conference and Tradeshow Exhibition 9:00 a.m. – 10:00 a.m. Meeting Room A Basic Pool Maintenance

Basic pool maintenance with a strong emphasis on pool safety. Attendees should come away with an understanding of pool and spa liability prevention and operator and resident safety. Perfect for new maintenance personnel with a basic exposure to pool care and safe operation. Dave Alfano, HD Supply – Regional Trainer David Alfano has over 35 years’ experience in facilities maintenance. Managed a crew of eight employees and over saw various subcontractors in the refurbishment of 6,587 apartment units in a 10-year program, which was completed in eight. David was recognized as employee of the year in southern California in 1998 and his property was also recognized as property of the year for that same year. He was a Maintenance Supervisor for multiple apartment communities in Washington State which consisted of 594 units. David was recognized by the Washington Apartment Association as the Maintenance Supervisor of the year for 2003. He was a Regional Maintenance Supervisor for over 10 years for a local property management firm with 30 properties in their portfolio; he was instrumental with setting up training programs and assisting in coordinating property capital proj-

ects and renovations while he was there. David is NSPF Certified Pool Operator (CPO) and Lead Paint Removal & Remediation EPA Certified. He is excited to share his experience in multifamily facilities maintenance.

Classroom B

Plumbing Repair Techniques & Tips

Water Heater repair tips, tricks and best practices. There will be a “Stump the Professional Plumbers” segment, so bring your questions, plumbing concerns and find the right answer from two seasoned industry professionals. Chris Blamire, Roto-Rooter Services Co – Plumbing Manager Chris has been in the Seattle/Tacoma area as the Plumbing Manager for Roto-Rooter for the last 17 years. He has a vast knowledge in Service, Commercial and New Construction Plumbing. Chris is a Licensed Journeyman Plumber in Washington State and Canada. Lance Shippy, Roto-Rooter Services Co. – Commercial Manager Lance has been in the service plumbing industry for the last 20 years in the Seattle/ Tacoma area. He has specialized in service plumbing and excavations repairs. Lance is a Licensed Journeyman Plumb-

er in Washington State and a Licensed Gas Flex installer.

attendee in understanding fundamental meter reading skills.

Social Hall

Randy Kruger, Whirlpool Corporation – District Service Manager Randy has over 30 years experience in the appliance industry. Randy started his career as an electrician in the United States Navy. After leaving the Navy, he worked for a Factory Service company and an independent service company as a field technician. In 1990, he started working as a field service technician for Whirlpool Factory Service. During the time at Whirlpool, Randy has held several different positions of increased responsibilities; TechLine Consultant, Regional Service Manager, Senior Account Manager, and now District Service Manager for Oregon, Washington, Idaho, and Alaska. Part of the job responsibilities of a District Service Manager is to provide technical training to service technicians in the region. Randy has a thorough understanding of the appliance industry and very strong technical/diagnostic skills

Debunking the Myths about Mold and Mildew

This course will discuss industry specifics of how to properly deal with moisture problems, the inevitable fungal growth, and fallout from worried residents. Let’s be honest, the majority of mold and mildew issues start with the environment the residents are creating in their homes. With that said we must be sensitive to their needs and concerns. This course will explain sources of mold and mildew, diagnose why it’s there, give service team members techniques to deal with residents, and ultimately manage the occurrence properly in order to protect the property, employer, and client.

Banquet Room A/B/C

Whirlpool Appliance Repair (Refrigerator)

In this class you will learn to diagnose all typical refrigerator failures including the self-defrosting system, fan motors, thermostats, and compressor components to name a few. We will discuss in detail maintenance and proper use and care for tenants to promote longevity of many of the components requiring cleaning on a regular basis. Basic understanding of a Volt/ Ohm meter will be discussed to aid the

John Ybarra, Whirlpool Corporation – Field Service Trainer John has over 30 years experience in the appliance industry. He first worked in his family’s appliance store as he was growing up. He left the family business and worked for an independent service continued on page 17

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Rental Housing Journal On-Site · March 2016

WFMHA’s 2016 Maintenance Summit Education Conference & Tradeshow Exhibition provider before joining Whirlpool Corporation in 1994 as a Factory Service Technician. For a brief period, John worked for Maytag Factory Service as a Lead Technician before rejoining Whirlpool as a Master Technician for the Whirlpool Tech-Line. In 2012, he was promoted to District Service Manager, covering California & Nevada. John has very strong technical and diagnostic skills. He is currently working with an elite Field Service Training Team within Whirlpool, responsible for the delivery of training to their authorized service network and trade customers.

10:30 a.m. – 11:30 a.m. Meeting Room A Safety On Site:

The highest priority of a maintenance associate is safety! This class is a good introduction to OSHA and the regulations they have designed to keep the maintenance industry safe and service personnel healthy. Common sense applications will be discussed in: S.D.S sheets; chemical storage and use; moving heavy equipment properly; crime and security issues; protective equipment usage; Lockout/Tagout; blood borne pathogens; ladders and their use; and natural safety issues. Dave Alfano, HD Supply – Regional Trainer David Alfano has over 35 years’ experience in facilities maintenance. Managed a crew of eight employees and over saw various subcontractors in the refurbishment of 6,587 apartment units in a 10year program, which was completed in eight. David was recognized as employee of the year in southern California in 1998

and his property was also recognized as property of the year for that same year. He was a Maintenance Supervisor for multiple apartment communities in Washington State which consisted of 594 units. David was recognized by the Washington Apartment Association as the Maintenance Supervisor of the year for 2003. He was a Regional Maintenance Supervisor for over 10 years for a local property management firm with 30 properties in their portfolio; he was instrumental with setting up training programs and assisting in coordinating property capital projects and renovations while he was there. David is NSPF Certified Pool Operator (CPO) and Lead Paint Removal & Remediation EPA Certified. He is excited to share his experience in multifamily facilities maintenance.

Classroom B

Emerging Technologies in Electrical: GFCIs and AFCIs in Apartment Homes:

A big part of maintenance professional’s role is to ensure the safety and comfort of residents in their homes. In this session we will discuss the applications and functions of GFCI and AFCI devices in the multi-family environment. Dane Sydow, Essex Property Trust – Learning and Development Manager Dane started his career in residential property management in the mid 90’s as a Porter at a mid-rise lease up community in Seattle, WA. Since then he has served the residential property management community in a variety of capacities. From Maintenance Supervisor

to Maintenance Recruiter to his current position of Learning and Development Manager with Essex Property Trust, he has exhibited an undying passion for putting people in touch with the resources that will have a positive impact on their career growth.

Social Hall

Disaster Preparedness:

Learn efforts to take to build a plan for responding to any emergency situation that might affect your property, your staff or your residents. Prior planning and preparedness may be the most critical step to handling any emergency circumstances that might arise. Raejean Kreel, Tukwila Fire Department – Emergency Management Specialist

Banquet Room A/B/C

Whirlpool Appliance Repair (Washers/Dryers):

In this class the participant will learn the basics of cleaning and repair of the unitized laundry center. Cleaning of lint from the dryer vent and strategic parts of the dryer to maintain safe operation will be covered along with other maintenance critical to maintaining longevity. Repair and replacement of parts with high failure rates will be covered in detail. Complete disassembly of a laundry unit will take place for a first hand real world experience for the participant. Randy Kruger, Whirlpool Corporation – District Service Manager Randy has over 30 years experience in the appliance industry. Randy started his career as an electrician in the Unit-

ed States Navy. After leaving the Navy, he worked for a Factory Service company and an independent service company as a field technician. In 1990, he started working as a field service technician for Whirlpool Factory Service. During the time at Whirlpool, Randy has held several different positions of increased responsibilities; Tech-Line Consultant, Regional Service Manager, Senior Account Manager, and now District Service Manager for Oregon, Washington, Idaho, and Alaska. Part of the job responsibilities of a District Service Manager is to provide technical training to service technicians in the region. Randy has a thorough understanding of the appliance industry and very strong technical/diagnostic skills. John Ybarra, Whirlpool Corporation –Field Service Trainer John has over 30 years experience in the appliance industry. He first worked in his family’s appliance store as he was growing up. He left the family business and worked for an independent service provider before joining Whirlpool Corporation in 1994 as a Factory Service Technician. For a brief period, John worked for Maytag Factory Service as a Lead Technician before rejoining Whirlpool as a Master Technician for the Whirlpool Tech-Line. In 2012, he was promoted to District Service Manager, covering California & Nevada. John has very strong technical and diagnostic skills. He is currently working with an elite Field Service Training Team within Whirlpool, responsible for the delivery of training to their authorized service network and trade customers. continued on page 18

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Rental Housing Journal On-Site · March 2016

WFMHA’s 2016 Maintenance Summit Education Conference & Tradeshow Exhibition

12:30 p.m. – 1:30 p.m. Meeting Room A Service Team and Office Team Coordination:

The purpose of this presentation is to help you define your idea of a high-performing office team, get you focused, passionate, and cohesively working together because you are one team. This class will help you to create a high-functioning, quality service, unified team, all driven by communication and support of each other, what we like to call teamwork!

Classroom B

Touchdowns in Leadership:

Learn how the game of football relates to your property maintenance world. Be a team captain at your property to motivate and drive your team for success. Tackling challenges, hustling to solve problems, passing assignments to beat the clock combine for a winning formula. Authoritative and influential leadership is essential in any career path – come be captivated, motivated and activated. Jessica Fern, FPI Management – Training & Development Manager Jessica has 7 years of experience in the Multi-Family Housing Industry and is the current Training and Development Manager for FPI Management Inc. Jessica trains employees in multiple states on sales, customer service, leadership, operations, management, budget compliance, and has just developed and rolled out an 8 hour Maintenance Training course. Jessica has specific education

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working as a field service technician for Whirlpool Factory Service. During the time at Whirlpool, Randy has held several different positions of increased reSocial Hall sponsibilities; Tech-Line Consultant, ReTips & Tricks Of The Trade: gional Service Manager, Senior Account This course will go through the ba- Manager, and now District Service Mansics of the tricks every maintenance ager for Oregon, Washington, Idaho, and person should know in order to man- Alaska. Part of the job responsibilities of age their day more efficiently. From the a District Service Manager is to provide best wall patch, door patch, popcorn technical training to service technicians ceilings, plumbing fi xes, and basic best in the region. Randy has a thorough unpractices for saving time and money. derstanding of the appliance industry and We also cover some great products on very strong technical/diagnostic skills. the market that may or not be known to your maintenance team. These tips John Ybarra, Whirlpool Corporation and tricks come from a wide variety of – Field Service Trainer John has over 30 years experience in sources inside and outside of the industhe appliance industry. He first worked try. It is sure to be a fun, interesting, in his family’s appliance store as he was and informative class for all. growing up. He left the family business Banquet Room A/B/C and worked for an independent service Whirlpool Appliance Repair provider before joining Whirlpool Corporation in 1994 as a Factory Service Tech(Dishwasher & Ranges): All new dishwashers have internal in- nician. For a brief period, John worked herent energy reduction changes based for Maytag Factory Service as a Lead on DOE regulations. During this class Technician before rejoining Whirlpool as you will learn how these changes are a Master Technician for the Whirlpool implemented into the new dishwasher Tech-Line. In 2012, he was promoted to wash system. We will also cover dish District Service Manager, covering Caliand glassware cleaning complaints, fornia & Nevada. John has very strong and how to determine component fault technical and diagnostic skills. He is currently working with an elite Field Serand diagnosis. vice Training Team within Whirlpool, Randy Kruger, Whirlpool Corporation responsible for the delivery of training –District Service Manager to their authorized service network and Randy has over 30 years experience trade customers. in the appliance industry. Randy started his career as an electrician in the United States Navy. After leaving the Navy, he worked for a Factory Service company and an independent service company Race Fan Sponsors as a field technician. In 1990, he started ABC Towing ABODA Cleaning Services American Floors and Blinds NEW PRODUCT! Bath Fitter Barker Martin Behr Paint A Full Service Tenant Screening Buy Rite Carpet Wholesaler & Credit Reporting Company – Credit Reports Start at $25 Cadet Manufacturing Chimney Specialists, Inc. Criterion Brock Elite Resurfacing  Nationwide criminal + evictions records Gorman Roofing  Quick turn around time Red Rock Resurfacing  Credit score – full credit reports available Rehab LLC  Personal + professional assistance Security Solutions NW Vasquez Landscapes Wilmar and passion for Leadership, and takes a special interest in the Maintenance aspect of the industry.

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Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

Legislative Roundup ...continued from page 5 coming years housing budgets and programs. It was a very broad discussion about national housing trends, but was still a good perspective of where Washington’s housing politics sit within the nation. Below are some notes from the discussion: In the Housing Landscape for 2016 a few comments that seem to be consistent with what we have experienced, or at least been hearing in Washington State. Millions of low to moderate income-working households spend more that half of their income on housing. More households are renting, leading to escalating rents and greater affordability challenges. Lower-income and minority households are significantly more likely to be cost burdened than higher-income and Caucasian households. The highest shares of cost burdened working households live in high-cost markets on the coasts. Seattle was not mentioned specifically. Federal policies are critical for addressing the high demand for affordable housing, but current resources are

Dear Maintenance Men ...continued from page 7

insufficient to meet needs. At the state and local level, tax policies, zoning and land use regulations can provide incentives and reduce costs for creating more affordable housing. This is the position that many private sector residential developers have been saying for years. Seattle has its own special regulatory issues. Strategies need to stress the importance of place to ensure that individuals and families have access to opportunity. Bottom line 80% of HUD’s budget is rental assistance programs like Housing Choice Vouchers, Public Housing, Project-based rental assistance, Homelessness Programs, etc... Although there is hope for more money to assists increase rental assistance in the federal budget, the partisanship over the budget probably will not yield any more that the same spending levels of the last biennium. Bill Hinkle Hinkle and Associates, LLC

am debating filling it in and putting in grass over the top. What is the procedure for filling in a pool? Rena

Dear Rena: In our opinion a filled in apartment swimming pool is a good apartment swimming pool and an excellent use of dirt! First, before filling in a pool, check with your city or county, permits and procedures may differ. Drain all of the water out of the pool and pour concrete into the skimmer, main bottom drain and into any pipes leading into the pool. This will stop any water or creatures from using the pipes as a runway into the pool equipment area. If your pool is surrounded by concrete, try to save the water fill line into the pool, it can be used as a future sprinkler water line. Using a jackhammer, poke a number of holes in the bottom of the pool to help in drainage. These holes should be at least twelve inched wide and all the way through the pool bottom. Keep in mind the pool bottom can be a foot thick or more. Leave all the jackhammer debris in the bottom of the pool; it will help in future drainage. If your coping around the pool is in good condition, you can leave it, but we recommend that it be removed.

The coping can easily be detached by sledge or jackhammer. Just let the coping fall into the pool it will also help in drainage. One half to three quarters of the back fill material should be sand or gravel at the bottom of the pool. The balance of the fill should be clean dirt and topsoil level with the existing grade. Water the dirt as you back fill the pool to help in compressing the soil. The topsoil should be pack down with a tamper. Water the soil regularly for about a week, filling in any low spots. Seed or landscape as you wish after the soil has stabilized. Lastly, contact your insurance company and tell them the good news about your newly filled in pool, your rates might just come down a little. 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

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Earthquake Insurance ...continued from page 11 The Predicted Impact

What that mean to owners of Pacific Northwest properties is that there is a risk and we need to prepare for it. A 2011 Cascadia earthquake study by the Federal Emergency Management Agency (FEMA) estimated that only 20 percent of the buildings located in the Portland Metro region would escape damage; the other 80 percent would suffer damage from slight to complete loss.

Table 1: Analytical Baseline Study for the Cascadia Earthquake and Tsunami (Source: FEMA, November 18, 2011) Commercial

None

Slight

Moderate

Extensive

Complete

Total

Metro

6,759

10,106

12,270

4,647

461

4,242

Outside Metro

14,333

7,596

11,878

7,904

3,072

44,785

Total

21,092

17,702

24,148

12,551

3,533

79,027

Statewide, the report predicted that about 27 percent of commercial buildings would survive without damage, and 22 percent would suffer slight damage. The remaining buildings which would suffer moderate damage (31 percent) or extensive damage (16 percent)or will be completely destroyed(4 percent)will not be unusable for commercial purposes. More importantly, the Oregon and Washington coastline will most likely be swamped with a tsunami. It predicted that the most dangerous impact at the 9.0 scale will be felt all along the Oregon coast and be particularly devastating to the coastal communities of Crescent City, California; Cannon Beach and Warrenton in Oregon; as well as the Moclips/Westport area in Washington. It will include a tsunami and the following impacts along the I-5 corridor. This major FEMA study also included significant details regarding the infrastructure impact of such a large earthquake: Electric power: Extensive electric power outages would be experienced throughout the region. Outages could last several weeks along coastal areas but most customers in other areas are expected to have power restored within 1 to 8 days. Natural Gas: Damage to both the transmission and distribution pipeline networks in the affected region could cause the majority of customers in western Washington and western Oregon to lose natural gas service. Many homes may lose all sources of heating due to the combined effects of natural gas and electric power outages. Telecommunications: Major undersea transpacific cables are likely to be severed; disrupting communication service to East Asia as well as between Alaska and the contiguous United States, with a two- to three-month expected restoration time. Transportation Fuels: A significant number of pump stations along the Olympic and Oregon Line refined-product pipeline system, as well as a substantial number of refined product terminals in the region, are expected to sustain considerable damage; the inability to store and distribute fuels locally is likely to have a major impact on regional fuel supplies.

Road Transportation: Significant damage to roads can be expected, particularly those along the coast and connecting the coast to the I-5 corridor. U.S. 101 is expected to suffer substantial damage due to both ground shaking and tsunami, resulting in a limited capacity to carry traffic for several months. Nearby coastal areas may be isolated for a short period. Water Transportation: Tsunami damage at the mouth of the Columbia River is likely to impact navigation and the ability to export agricultural commodities. Rail Transportation: Long-term rail traffic disruptions along the I -5 corridor and a complete loss of key rail bridges in the Olympia and Seattle area and downtown Portland are expected. Banking and Finance: Loss of major transpacific undersea cable capacity would affect transoceanic commerce, settlement, and transpacific financial market exchanges. Emergency Services: Widespread damage to police stations, fire stations, and hospitals along the coast is expected. Health Care: The potential of 15,000 to 30,000 casualties and the expected loss due to damage of 15-27 hospitals comprising 524-1708 regular beds and 60-228 critical bed facilities concentrated near the coast would be sufficient to saturate the excess capacity of other hospitals within a 250- mile range of the worst damage. Water and Wastewater: Disruptions to potable water supply are expected with restoration times of three weeks to seven months with the greatest damage and restoration times occurring near the coastline. It is clear that the impact for a 9.0 earthquake will affect many businesses. Many small companies, because they lack the financial resources to survive, will be put out of business. This will have a direct impact on residential and commercial investments since businesses leasing commercial space might fail due to a lack of power, fuel, and communications. If some commercial tenants fail due to the earthquake, then many people will be left without the income to pay residential rent with. I believe all properties should be covered by earthquake insurance. In that vein, we have included some tips to consider when shopping for earthquake insurance.

Understanding Earthquake Insurance

There are typically three (3) main parts of the basic earthquake coverage, your property coverage which covers your property up to a certain amount, called the limit; personal property coverage; and loss of rents coverage. Property coverage needs to be researched, as do deductibles. In Oregon, unlike California, there is no regulated coverage and only a limited pool of providers. Choose a company that is strong,rated by A.M. Best or check with the Oregon insurance commissioner. Note that earthquake insurance may not cover landscaping, pools, fences, masonry, and out buildings like storage or garages. If you rent or own a condo, you do not need this coverage as long as you make sure your association has the coverage. Loss of rents coverage should be on an â&#x20AC;?actual loss guaranteed basisâ&#x20AC;? and extend continued on page 22

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Rental Housing Journal On-Site Âˇ March 2016

Rental Housing Journal On-Site

Rents to Flatten in 2016 ...continued from page 10 Metropolitan Area

Dec. 2015 ZHVI

Dec. 2015 ZRI

ZRI Forecast for Dec. 2016

Forecasted Difference Between Dec. 2015 ZRI and Dec. 2016 ZRI

United States

$183,500

$1,381

$1,396

1.1%

New York/Northern New Jersey

$381,200

$2,384

$2,400

0.7%

Los Angeles, CA

$554,700

$2,491

$2,561

2.8%

Chicago, IL

$193,000

$1,633

$1,611

-1.4%

Dallas-Fort Worth, TX

$177,200

$1,500

$1,532

2.1%

Philadelphia, PA

$203,100

$1,558

$1,550

-0.5%

Houston, TX

$170,100

$1,579

$1,619

2.5%

Washington, DC

$357,800

$2,107

$2,118

0.5%

Miami-Fort Lauderdale, FL

$225,700

$1,822

$1,886

3.5%

Atlanta, GA

$160,000

$1,274

$1,280

0.5%

Boston, MA

$382,900

$2,247

$2,309

2.7%

San Francisco, CA

$785,800

$3,338

$3,536

5.9%

Detroit, MI

$121,800

$1,132

$1,128

-0.4%

Riverside, CA

$298,200

$1,691

$1,723

1.9%

Phoenix, AZ

$216,000

$1,249

$1,266

1.4%

Seattle, WA

$368,700

$1,931

$2,018

4.5%

Minneapolis-St. Paul, MN

$214,300

$1,500

$1,511

0.8%

San Diego, CA

$499,900

$2,316

$2,348

1.4%

St. Louis, MO

$141,000

$1,123

$1,115

-0.7%

Tampa, FL

$160,100

$1,296

$1,302

0.5%

Baltimore, MD

$242,300

$1,714

$1,702

-0.7%

Denver, CO

$320,800

$1,952

$2,031

4.0%

Pittsburgh, PA

$126,700

$1,090

$1,079

-1.0%

Portland, OR

$310,200

$1,689

$1,753

3.8%

Charlotte, NC

$157,800

$1,221

$1,250

2.4%

Sacramento, CA

$331,500

$1,599

$1,654

3.4%

San Antonio, TX

$148,000

$1,301

$1,306

0.4%

Orlando, FL

$180,600

$1,343

$1,373

2.2%

Cincinnati, OH

$141,800

$1,225

$1,243

1.5%

Cleveland, OH

$124,300

$1,124

$1,117

-0.6%

Kansas City, MO

$146,600

$1,199

$1,228

2.4%

Las Vegas, NV

$199,800

$1,212

$1,191

-1.8%

Columbus, OH

$150,900

$1,271

$1,289

1.4%

Indianapolis, IN

$130,100

$1,181

$1,138

-3.6%

San Jose, CA

$933,000

$3,431

$3,699

7.8%

Austin, TX

$242,900

$1,683

$1,741

3.4% Source Zillow

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Rental Housing Journal On-Site

EPA Cracks Down On ...continued from page 1 violator may get by underbidding competitors that are compliant. You can read the full EPA media release here: http://yosemite.epa. gov/opa/admpress.nsf/0/0D3D2DBE30561BAD85257EEB00698FC7 ‘Looking for a lead-safe contractor or want to become certified yourself in order to do work on your own properties? Call the Leadline for free information at 503/988-4000. A reminder that although lead poisoning is especially dangerous for kids, the fear of lead poisoning or liability does not give housing providers the right to deny or discourage families with children away from pre-1978 housing. Familial status is a protected class under federal fair housing law1 and doing anything to deny or discourage otherwise qualified families is illegal. Visit www.FHCO.org for more information on this topic. This article brought to you by the Fair Housing Council; a civil rights organization. All rights reserved © 2016. 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 www.FHCO.org for more information.

Earthquake Insurance ...continued from page 20 for at least 24 months, preferably 36 months(if you can find it). The longer the better since after a major earthquake you may have trouble finding tenants. Other coverages to consider include building code upgrade coverage or coverage for limited debris removal, land restoration, and emergency repairs. It is also important to know what your earthquake insurance policy does not cover. All insurance policies have exclusions. Have your insurance agent help you understand your policy. In general, earthquake insurance usually does not cover anything that your normal building insurance policy already covers. You definitely need to check with your insurance agent to confirm where fire and liability insurance leave off and where earthquake insurance kicks in. Common exclusions include: Fire: Even if an earthquake causes the fire, your building insurance policy covers fire damage. Land: Usually, earthquake insurance does not cover damage to your land, such as sinkholes from erosion or other hidden openings under your land. You may be able to buy limited additional coverage to restore or stabilize land. Vehicles: Earthquake insurance does not cover damage to your vehicles or your tenants’ vehicles. If you have a fleet of vehicles that might be damaged you may want to check into additional insurance. Flood: Even if you live near a lake that floods your home after an earthquake, water damage from floods, including those caused by a tsunami, are covered by flood insurance, not earth-

quake insurance. When purchasing earthquake insurance, you may need to buy on a secondary market. Ask your insurance agent to scour the market and make sure that you are getting the best deal you possibly can. Don’t be surprised if the deductibles run from 15 – 25%. Consider how much cash you will have on hand to jump start a repair process. After a 9.0 earthquake it may take 6 – 8 months before the city will clear your building for occupancy. Earthquake insurance premiums vary depending on many factors, including the age of your building, the rent collected, the location, the kind of soil, the cost to rebuild, and the deductible. Don’t be shocked if it is expensive.

What else can you do to protect your property and manage your risk from a major earthquake? • • • • •

•

• •

Bolt the property to the foundation. Brace any chimneys. Strap water heaters to the wall. Put in automatic gas shut-off valves. Advise tenants to screw bookshelves and book cases into the wall. Research the location of the property on a local hazard map to assess your risk. Follow government issued earthquake proofing recommendations. Reserve funds for earthquake proofing capital projects. Tie the roof to the studs

during roof replacements. • Tie the roof structure to the wall structure. The main recommendation in all documents regarding the impending Cascadia earthquake stress preparation and planning. We may not have the power to prevent the earthquake, but we do have the knowledge and technology to reduce the damages it may inflict. Even if you own one of the 20 percent of properties not affected, you still will be faced with the infrastructure problems such as a lack of power and telecommunications for days or weeks resulting in tenants unable to pay the rent. All buildings will be affected and all building owners need to prepare. The first step to mitigating your risk is to buy earthquake insurance.

Resources

The Oregon Resilience Plan https://multco.us/em/ oregon-resilience-plan The City of Portland Hazard Map: https://www.portlandoregon.gov/pbem/58572#maps Story: Historic Earthquakes, Teara: The Encyclopedia of New Zealand http://www.teara.govt.nz/en/historic-earthquakes/page-13 The Really Big One: An earthquake will destroy a sizeable portion of the coastal Northwest, The New Yorker http://www.newyorker.com/magazine/2015/07/20/the-really-big-one Turbidite Event History—Methods and Implications for Holocene Paleoseismicity of the Cascadia Subduction Zone, U.S. Geological Survey http://pubs. usgs.gov/pp/pp1661f/ 13-year Cascadia study complete – and earthquake risk looms large, OSU News & Research Communications http://oregonstate. edu/ua/ncs/archives/2012/jul/13-year-cascadiastudycomplete-%E2%80%93-and-earthquake-risklooms-large Analytical Baseline Study for the Cascadia Earthquake and Tsunami, Department of Homeland Security https://www.bluestonehockley.com/wp-content/uploads/2016/01/FEMA-earthquakestudy.pdf

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Rental Housing Journal On-Site · March 2016

Rental Housing Journal On-Site

4Q15 Market Update ...continued from page 13

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Rental Housing Journal On-Site · March 2016