Rental Housing Journal On-Site September 2015

Rental Housing Journal Utah

2. President’s Message Ask the Attorney 3. Director’s Message

September 2015 - Vol. 7 Issue 9

UPCOMING EVENTS 5. A 10-Step Action Plan to General Membership Meetings Suppress Crime at Apartments All meetings 7PM - for addresses go to

7. Dealing With Rental Deposits

www.uaageneralmembershipmeetings.com

Ogden .......................................... Oct 27th Orem ............................................. Oct 28th Salt Lake City............................ Oct 29th

EVENTS Topics: Carpet, Pest Control and Inspections Annual Meeting “Legal Seminar” ............................... Nov. 10th

www.rentalhousingjournal.com • Professional Publishing, Inc Official Publication of The Utah Apartment Association Utah’s Leading Advocate for the Rental Housing Industry – 888-244-0401 – WWW.UAAHQ.ORG

Economic Forecasting Conference Reveals Strength of Rental Market

Jon Eichner Wins UAA Member-Geta-Member Grand Prize

Sandy Utah – On September 15th, the UAA held its annual Economic Forecasting conference, in conjunction with IREM (the Institute of Real Estate Management). Speakers included Dr. James Wood, Director of the Bureau of Economic Research at the University of

J

ohn Eichner, A UAA member since 2014, won the $1,000 Grand Prize in our Member-Get-a-Member contest.

The program, rewards members who refer a friend with a $25 UAA credit that can be used towards anything, and also gives the friend a $25 credit.

It’s been a very successful program,” says Gavin Gilbert, UAA Membership Coordinator. “Since we started in January we have had nearly 100 new members referred by members,” he says.

According to Jon, “I actually had no idea I could win $1,000.” Jon says he is a recent investor in rental property, and continued on page 4

PRSRT STD US Postage P A I D Sound Publishing Inc 98204

units that have been built in Utah and specifically Salt Lake County in the last 5 years. “Still, he said – it’s not enough and we see the vacancy rate continuing to fall.” Woods says new apartments are filled as fast as they are built due to pent up demand, strong job growth which creates households, and our strong population growth. According to Wood there are approximately 5,000 units just completed or under construction right now with another 5,700 in the pipeline.

New Construction Dr. Wood, an expert on the housing market in Utah talked about the record breaking numbers of new apartment

Homeownership Rates Another factor in the quick absorption of new construction is that the

continued on page 4

Top 5 Communities for Online Reputation Released

M

ultifamily Executive Magazine has released the results from the Online Reputation Assessment, powered by J. Turner research, which lists the top five apartment communities in Utah for online reputation. Three of the top five are managed by Utah based Management company Wasatch Premier Communities. One Utah Property, Sky Harbor Apartments, was also a top 50 community in the country, coming in 49th highest in the Nation.

The five highest in Utah are: • Four Seasons, Wasatch Premier Communities, Logan • Devonshire Court, Wasatch Premier Communities, Logan

Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

Utah and Greg Ratliff, Principle Broker of ARA Realty Advisors Utah.

• Talavera at the Junction, Wasatch Premier Communities, Midvale

• Highland Pointe, Pentalon Management, Salt Lake City • Sky Harbor Apartments, NALS, Salt Lake City So, where are the happiest residents?

According to the research, against a na-

tional average of 52, the highest score was found in Washington, D.C., where the district-wide average was 57. The lowest state-wide average was found in North Dakota with 41. continued on page 6

Advertise in Rental Housing Journal Utah Circulated to over 6,000 apartment owners, on-site and maintenance personnel monthly.

WWW.RENTALHOUSINGJOURNAL.COM

Call 503-221-1260 for more information.

Utah Apartment Association

President’s Message Cheri Goss, Board Chair, Utah Apartment Association

UAA’s guides and publication.

This year, there are even more exciting resources and tools included with membership: • Updated Landlord each renewal

Letter to Apartment Communities There is no apartment association in the country that provides more value and benefit for apartment communities than the Utah Apartment Association. In recent years the UAA has saved each apartment community thousands of dollars in fees and many hours in reduced government regulations. We have helped protect you from litigation and liability. We have limited the powers and tools of cities to unreasonably regulate you. Apartment managers and their staff benefit from hours of free UAA training, and can look up and reference laws and best practices in the

Ask the Attorney

By Jeremy Shorts Esq.

Guide

which supports, serves and protects apartment communities and their owners/managers.

Q: I need to evict my tenant, but they keep threatening bankruptcy.

Should I start the eviction process?

A: Typically yes. If your tenant is trying to work with you to get payments resolved, it may sometimes be beneficial to work with them to avoid dealing with an eviction and bankruptcy issue.

However, most often a tenant will use this as a delay tactic to get you to hold off on going through the process. If you proceed and your tenant does file bankruptcy, it can delay the process and cost more time and money to get them out.

The alternative, is to hold off on the eviction, which also benefits the tenant, to see if your tenant will follow through.

The problem with that option is if your tenant does not follow through, you have already lost more time and may be dealing with the bankruptcy issue anyway. I would most always suggest moving forward with the eviction and calling the tenant’s bluff. If they file for bankruptcy, you have at least started the process and don’t run the risk of losing out on more time because you felt like you could trust the tenant. The tenant has not followed through before and I would bet on them not following through again. Our office can help you navigate any bankruptcy issue that may arise.

Attorney Jeremy M. Shorts

2

• $75 off the 32 hour “Utah Professional Rental Operator” designation program

• A coupon for $10 off any “Good Landlord Class” • $75 off the 32 hour “Utah Professional Rental Operator” designation program • Admission to the 2016 Apartment All-stars (January, 2016)

• Free 30 minute private consultation with UAA staff (by appointment)

Letter to Independent Rental Soon, both the National Apartment Owners Association and the Utah Apartment

Association will be sending members a discount card that entitles them to substantial discounts with dozens of service providers and suppliers. As a UAA/NAA member you will be given “preferential” treatment and pricing to help you keep more of your hard earned money and be even more successful.

Without you, the Utah Apartment Association would not be the successful and highly regarded association it is. So as a special thank you for supporting the UAA, we are going to give you the following GIFTS with your renewal.

These are in addition to the many regular benefits of membership:

• Monthly industry publications from the UAA and the National Apartment Association We hope you that whether you have been a member for many years or are just learning about the UAA that you will support the organization

• Coupon for 5 free UAA carbon copy paper forms • Free UAA t-shirt (pick-up only) • A coupon for $10 off 2016 Educational Conference and Trade Show (April 27th, 2016)

2016 Slate of Candidates Each year the Apartment Association Nominating Committee, comprised of three past board chairs, presents a slate of candidates for the upcoming year’s board and executive committee. This year the nominating committee was comprised of Steve Randall, Gloria Froerer, and Kirk Cullimore. In addition Peter Harradine, the 2015 Vice Chair of the Board, was heavily involved.

As always, we are very excited about the quality of individuals who volunteer to serve on the UAA board and direct your association. The candidates will be ratified at the annual meeting on November 10th at 7:00 PM at the UAA Office. Below is the Slate of Candidates who have been nominated:

Current 2015-2016 Terms Dear Attorney,

• $10 off any “Good Landlord Class”

with

• Coupon for $10 off Lunch at the 2016 Educational Conference and Trade Show (April 28th, 2016)

448 E Winchester St Ste. 460 Salt Lake City, UT 84107 Ph: (801) 487-5619 Fax: (801) 484-8649 www.uaahq.org

Proposed 2016-2017 Terms

Carol Morris, Trition Investments

Brad Randall, Welch Randall

Cheri Goss, Mission Rock

Courtney Schneider, Utah Disaster Kleenup

Chris Williamson, The Sellers Group

Danae Mollerup, TREO

DJ Bruhn, UTPMA

Dawn Sandberg, Apartment Guide

Gloria Froerer, Century 21/ Gage Froerer

Jayme Buhlman, Greystar*

Holly Sanford, Cowboy Properties

Jean Smith, Staker Property Mgmt.*

Jeremey Palmer, For Rent Media Solutions

Joe Berger, BMG

Jeremy Shorts, Utah Eviction Law

Matthew Ledingham, Ledingham Properties

Judi Morrell, United Bond

Nikki Meadows, Action Property Mgmt

Kirk Cullimore, Law Offices of Kirk A. Cullimore

Pat Morse, Wasatch Premier Communities

Leslie Carroll, Apartments.com

Peter Harradine, Harman Property Mgmt.*

Lindsay Millet, Peak View Properties

Robert Watson, WSI

Perry Bolyard, Real Property Mgmt.

Travis Baker, Alliance Residential

Sheri Martin, Cornerstone Troy Burnett, ManageCo Wid Covey, Rentler

Associate Members Chair 2016 Chair Kelly Hunsaker, FitLogistics**

2016 Executive Committee Past Chair:

Cheri Goss, Mission Rock

2016 Chair:

Peter Harradine, Harman Property Management

Vice Chair:

Jayme Buhlman, Greystar

Treasurer:

Matthew Ledingham, Ledingham Properties

Secretary:

Jean Smith, Staker Properties Management

Legacy Member: Gloria Froerer, Century 21/ Gage Froerer Government Affairs Chair:

Kirk Cullimore, Law Offices of Kirk A. Cullimore

*UAA bylaws term limit board members to no more than two consecutive 2-year terms. However, members serving on the executive committee are exempt from term limits. ** The Associate Member Committee Chair is elected for a one year term.

In 2016 there will be 29 board members – 10 represent apartment management companies, 9 are vendors and 10 are independent owners or single family residential property managers.

Rental Housing Journal Utah · September 2015

Utah Apartment Association 448 E Winchester St Ste. 460 Salt Lake City, UT 84107 Ph: (801) 487-5619 Fax: (801) 484-8649 www.uaahq.org

Director’s Message

L. Paul Smith, CAE Executive Director, Utah Apartment Association

O

ne of the best things the UAA has going for our members is our exceptional staff.

RileeJo Stone is our Events Director. We recruited Rilee on an airplane to Washington, D.C. Rilee was attending a conference for student government. As the Vice President for student activities at Utah Valley University, Rilee supervised a budget of $170,000 a year and planned 40 major activities. She also supervised dozens of student clubs. With that background, we realized she was a perfect fit to be our event coordinator and supervise our committee process. In her first year, Rilee increased revenue to our golf tournament, economic forecasting conference and reverse trade show by as much as 50%. She infuses fun into our committees and events. We are lucky to have her energy and people skills.

UAA has excellent staff to serve you

When she’s not working she loves the outdoors and is usually on a boat or waterskiing behind it.

James Sidwell is our communication coordinator. In addition to maintaining our database, website, supervising production of our rental housing journal, James is the main contact for members who call and come in to get support. He spends hours a day reassuring members who are struggling with issues and helping coach them through their struggles. James has been with us for four years and is an expert in landlord laws and best practices.

Many members have learned to ask for James, as his no nonsense approach to problems calms them down and helps them solve them. He is a pilot and airplane junkie. Don’t try to come see him during the annual Wendover air races.

That’s his signature spectator event.

Michelle Wood-Peck is our office coordinator.

Michelle enters payments and handles accounts receivable. She is the first contact for new members and processes membership applications and renewals. Michelle is very creative at organizing the office. If you ever

Rental Housing Journal Utah · September 2015

come in for a free uaa t-shirt you’ll find whatever size shirt you get rolled up in a colored rubber band designating its size. Michelle always has a infectious smile and works hard to make sure everything and everyone is in order. She makes sure UAA never runs out of anything important and makes sure the rest of the staff all knows what needs to be done next. She is a recent transplant from California and loves the mountains and her husband Mike.

Taylor Smith is the education coordinator every student loves to have. Taylor has nearly completed his masters degree in history and loves all forms of training and education. He has been integral in designing UAA education curriculum and loves to be in front of a class teaching or designing a class. His enthusiasm is contagious and his diverse experience and interest as well as knowledge always comes in handy. One of the few male education directors in the National Apartment Association, he is a master at presentation design and delivery and helps UAA exceed its education income every year. He loves to knit, backpack and travel. He has worked for UAA for three years.

Gavin Gilbert is our membership director and government affairs assistant. Raised with an association executive as a father, and interning for our lobbyists at Capitol Hill before coming on board, Gavin is a natural at association operations and a people pleaser.

If you think Gavin looks young it’s because he is - yet wise beyond his years and quite an overachiever. He works full time for the association while also attending college full time. He is responsible for membership growth and helps us with government affairs. In his free time (does he really have any - yes because he rarely sleeps), Gavin loves to golf and talk to anyone he can.

All of our staff attend outside training courses on business and association management from such entities as Fred Pryor and USAE (Utah Society of Association Executives) as well as many hours a month training in Utah landlord tenant issues and best practices.

We are lucky to have such a competent and helpful staff. If you need them, rest assured they will take good care of you.

3

Rental Housing Journal Utah

Economic Forecasting ...continued from page 1

John Eichner Wins

...continued from page 1

US homeownership rate is at 63.5%, its lowest level since the Census bureau began seasonally adjusting the data in 1980. In the past year, the 1.2% drop in homeownership in the US created 1.4 million new renter household. Based on percentage of US population that would amount to almost 13,000 new renter households in Utah.

Renter Demographics According to Ratliff, today’s renter is a different from what we traditionally expected. Many are: • Renters by choice • Individuals seeking flexibility (according to Wood, 25% of Utah renters live alone) • They are shifting to city cores and like walkability and transit availability • Desire convenience, security and amenities • The term “pride of rentership” has become commonplace for those residing at well managed, well maintained properties • 43% are over age 45, a dramatic shift from the past

Wood agrees and offered even more statistics on renter households: • Avg. household size is 2.82 persons

• 60% are families, 40% nonfamily • 82% white, 18% minority with a large share of minority renters being Hispanic. About one is six renters are Hispanic • 19% of renters are seniors (55 +)

Expense Trending Michael Fazio, Western Liaison for the National Apartment Association, presented expense trending data for apartment communities. According to Fazio: • Salaries/personnel costs were 10.4 % of expenses. In Utah, they averaged $1,208 per unit, slightly down from 2012 • Capital expenses were 8.5% of expenses. Utah’s come in at $971 per unit • Maintenance costs have actually been going down and are only 3.5% of expenses. In Utah the per unit maintenance cost is $383, down from $498 two years ago

while researching property management found the apartment association online and joined. He was so pleased with all the resources and tools he had access to that he told a friend. “One of my good friends is also a landlord and I thought he too could benefit as a member. I didn’t even know til after he signed up that we’d both get a $25 voucher and I was even more shocked when I found out I had won $1,000 just for helping a friend,” he says.

In addition to the vouchers and the grand prize, the UAA is having a “appreciation movie night” where everyone that has referred a new member this year get together for a sneak peek at as an yet unreleased movie. This year, we will be seeing Spectre, the new James Bond movie, on November 5th, before it officially opens.

“There’s still time to get tickets,” Gavin says. “Just refer someone to the UAA before tickets are all gone!”

• Contract services (like carpet installation and use of outside vendors) is 2.9% of expenses and have stayed flat in Utah for two years at $364 a unit • Insurance costs are also falling. At 2.25 of expenses they fell from $212 in 2012 to $178 per unit last year.

• 53% of renter households are 1 and 2 person households, only 16% have 5 persons or more

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Rental Housing Journal Utah · September 2015

Rental Housing Journal Utah

A 10-Step Action Plan to Suppress Crime at Apartments

by Brent Sobol, originally published in the February 2010 issue of Units

danas (which could be gang identifiers); and not allowing residents to consume alcohol outside their apartment contribute to creating a respectful and obedient resident base.

Well-behaved residents appreciate these rules while the unruly often ultimately choose to move out. Enforcing discipline daily and showing respect for the lease agreement pays huge quality-of-life dividends for the entire community.

Following is a 10-step plan for crime reduction in rental housing 1. Know who is living in your apartments. If they aren’t on the lease, politely ask them to leave; most of the time they oblige. Have a police officer assist you when informing the unauthorized occupant that they are criminally trespassing. This is known in the law enforcement arena as a “knock and talk” and is very effective. This action step is essential because a large percentage of troublemakers are people who weren’t named on leases, but who were on the property when they decided to cause trouble. Walk 100 percent of your apartments at least twice a year, looking for unauthorized occupants and criminal activity. A person should accompany the owner or manager when he or she does this, for safety reasons.

2. Determine which units troublemakers are visiting, and then swiftly evict those apartments. As long as a leaseholder allows troublemakers to visit his or her apartment, the root problem will not go away. These troublemaking visitors rarely share the same respect for the lease agreement

as leaseholders. The lease should define the number of days visitors are allowed to stay in an apartment before they either must be added to the lease or are considered trespassers.

3. Don’t tolerate parents who don’t parent their kids. Teens today have easy access to hard drugs, weapons and other illegal and immoral temptations. Some parents today believe that they aren’t responsible for watching and mentoring their kids.

Some even think it’s the property manager’s job to be the parent. That’s

not how the law is written—wayward parents must be evicted from their apartments if their kids cause too much trouble. It is not against Fair Housing regulations to evict parents who cannot or do not want to curb their children’s repeated, inappropriate conduct.

4. Enforce community rules. Simple rules such as “No Littering” for items such as cigarette butts, bottle caps, candy wrappers, etc., not storing trash on balconies; not allowing unlicensed autos; not allowing ban-

5. Fix graffiti and vandalism on the same day they are discovered. Don’t let the troublemakers think they can win. By fixing vandalism promptly upon discovery, vandalism eventually ceases. An effective remedy to chronic fence-cutting or fence- hopping is to apply gooey axle grease to the fence or to plant pointy Chinese Hollies at the cut-through points as a deterrent.

6. Befriend real estate neighbors. The chances are that the type of bad behavior one community experiences carries over to neighboring properties or businesses. Counter that by striking a cordial relationship with neighbors over lunch or hold periodic community meetings so that continued on page 6

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Rental Housing Journal Utah

10 Step Plan to Surpress ...continued from page 5

7. Work hand-in-hand with law enforcement. The legal process is confusing because it jointly involves people’s homes and criminal behavior. Add to it that laws in locales differ. Sometimes, what is legal does not seem right and what is right does not seem legal. Local prosecutors and members of police departments are good sources to use when developing strategies to deal with the worst offenders for your locale. They want to work with you to solve crimes. To do so, owners must be persistent in requesting assistance and must provide specific details about circumstances that are believed to have led to illegal activity. One way to document this activity is with a digital camera. When troublemakers notice that they have had their pictures taken, they usually won’t come back because they know evidence exists to implicate them in a crime. As victims of criminal trespassing or loitering, owners have the right to take such pictures.

8. Review the lease agreement thoroughly with leaseholders when they move-in. By doing so, it is much less likely that rule-breaking residents will make excuses to police officers and property managers, such as, “I didn’t know I wasn’t allowed to move-in my unemployed, drug-addicted, recently evicted, second cousin without my landlord’s permission.” Excellent property managers will ask that the leaseholders initial each paragraph of the lease at lease signing. Yes, this can be time

consuming, but it will convey the importance of following community rules in accordance with the lease.

9. Don’t allow “hanging out” at the community. This often leads to other things, especially when teenagers are involved. Inform visitors that they always must be in a leaseholder’s home during the visit and should not be loitering about the real estate.

If you confront such an interloper, offer to safely accompany visitors to the leaseholder’s home. By doing so, many times they will choose instead to simply walk off the property because they weren’t there to visit a leaseholder in the first place.

10. Hire off-duty police for occasional and random enforcement. Though the going rate for an off-duty police officer can be as much as $50 an hour, this is a worthwhile investment for owners who experience chronic problems. Ask the captain at your local police precinct to recommend an officer who might be interested in an off-duty, extra job assignment.

Screen off-duty police officers to determine their tendencies to make arrests because some officers prefer to simply talk to offenders rather than arrest them. Communities experiencing tough crime activity require officers who are more likely to make arrests. Some avoid making arrests to avoid filling out the required paperwork that accompanies an arrest.

Also note: Although security patrol officers who work with for-profit companies have the ability to detain crime suspects, only an officer of the law can legally make an arrest and create a criminal charge. Security officers can be excellent at deterring crime, but often aren’t able to solve root crime causes.

Combating crime and promoting community safety is a passion of Brent Sobol, who operates 1,100 apartment units for TORO Properties; he was awarded the 2009 Citizen of the Year Award by the Atlanta Police Department for his commitment to crime prevention.

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Rental Housing Journal Utah · September 2015

Rental Housing Journal Utah

Dealing with Rental Deposits

By Kirk. A Cullimore, Law offices of Kirk A. Cullimore

Y

our resident just vacated. You check the unit and no surprise, the unit is a mess. Fortunately, resident paid a security deposit. Now what?

Whether your resident gave proper written notice at the end of the lease or skipped before the lease expired, your obligations as a landlord under Utah law on how you handle the security deposit are the same. What then are those obligations?

Under Utah law, upon termination of a resident’s tenancy, you may apply money held as a deposit “toward the payment of rent, damages to the premises beyond reasonable wear and tear, other costs and fees provided for in the contract, or cleaning of the unit.” (Utah Code § 57-17-3(1)) This means you can apply the resident’s security deposit towards any monies owed pursuant to the lease, including cleaning and damages. If your resident signed a Cleaning and Damages Addendum (or something similar), any of the applicable charges can be deducted from the security deposit.

If your resident did not sign an applicable Addendum, then charges for cleaning, carpet cleaning, painting, plus anything damaged that must be either repaired/replaced (all subject to normal wear and tear), can be deducted from the security deposit. In cases where there is no applicable Addendum,

documentation, including receipts, invoices, and pictures, is crucial. It is not uncommon for former residents to dispute charges for cleaning/damage; having documentation, especially pictures, only bolsters the likelihood of those charges being awarded if contested in court.

In addition to deducting amounts for cleaning/damages from the security deposit, you can also include any future rent owed, subject to your obligation to mitigate damages. Look for a future article that will discuss in more detail mitigation and future rent.

After applying resident’s security deposit towards monies owed, then what?

Under Utah law, you then have an obligation to send to the resident a written accounting reflecting how you applied the security deposit. When must you provide this written accounting and where do you send it?

Utah law specifically requires that “no later than 30 days after the day on

which a renter vacates and returns possession of a rental property,” you “shall deliver to the renter at the renter’s last known address: (a) the balance of any deposit; (b) the balance of any prepaid rent; and (c) if the owner or owner’s agent made any deductions from the deposit or prepaid rent, a written notice that itemizes and explains the reason for each deduction.” (Utah Code § 5717-3(2)) What if you fail to deliver the written accounting within 30 days of your renter vacating and returning possession of the unit back to you? If that were to happen, all is not lost, as Utah law then shifts obligations upon the renter.

The renter may then serve you written notice. The renter’s written notice must substantially comply with the form provided in the applicable statute and must be served in the same manner as you are required to serve eviction notices, i.e. either (1) personally to the owner/ owner’s agent at the address provided in

the lease agreement; (2) leaving a copy with a person of reasonable age and discretion if owner/owner’s agent is absent at the address provided in the lease agreement; (3) if no one can be found at the address provided in the lease agreement, affixing a copy in a conspicuous place at the address provided in the lease agreement; or (4) sending a copy through registered/certified mail to the owner/owner’s agent at the address provided in the lease agreement. (See Utah Code § 57-17-3(4)) If the tenant’s written notice complies with the law and is properly served, you must provide the written accounting within five (5) business days of service. Otherwise, if you fail to do so, the former tenant can initiate litigation where your failure to comply with former resident’s written notice would require you to refund the entire security deposit, a penalty of $100.00, as well as the possibility of being responsible for resident’s court costs and attorney fees. (See Utah Code § 57-17-3(3)(b)) Best practice is obviously to send the written accounting sooner than later. However, should that not happen within 30 days, get it done as soon as you can, as there is no real concern unless or until resident properly serves you the required written notice by law.

To contact the law offices of Kirk A Cullimore go to www.cullimore.net or call 801-571-4477

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Rental Housing Journal Utah · September 2015

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Rental Housing Journal Utah 路 September 2015