Valley ( Eugene, Salem, Corvallis , OR ) RHJ January 2018

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January 2018

Rental Housing Journal Valley

2 How Apartment Rules to Protect Children Could be Discrimination

5 Landlords Missing Rent Payments Online after Company Bankruptcy

3 President’s Message RHA Oregon Optimistic in 18

6 How Do You Practice Compliance in Apartment Leasing and Management?

4 Dear Maintenance Men

EUGENE · SALEM ·ALBANY · CORVALLIS WWW.RENTALHOUSINGJOURNAL.COM • PROFESSIONAL PUBLISHING, INC

The Best Cities to Invest in Apartment Buildings in 2018 By Vinney Chopra

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he best cities to invest in apartment buildings for 2018 and which markets will provide best returns is the subject of this blog by veteran real estate investor and syndicator Vinney Chopra. He takes a look at the best cities to invest in apartments as many begin to see a softening of rental rates and rising vacancies. We enter 2018 with a changing environment in multifamily investing, but some of the underlying keys for investors’ success are still there if you look closely. “The biggest challenge is going to be finding attractive places to put new money to work,” Brian Kingston, chief executive of Brookfield Property Group, one of the world’s largest real-estate investors, told the Wall Street Journal. “Investors need to be cautious about the prices they’re paying.” Add to that the likelihood that interest rates are going to rise this year, and 2018 is shaping up to be particularly precarious. But that doesn’t mean that Brookfield or any of the world’s other leading real-estate investors are going to be sitting on the sidelines this year. Rather, they are pursuing an unusually eclectic assortment of strategies spanning a wide range of geographies and asset classes. Start with emerging markets where you see job growth and a favorable local government environment that encourages business development. As big cities see more new high-priced apartments coming on board in 2018, those rents will likely stop rising. “Rents themselves are still lower in the suburbs, but if demand keeps growing for suburban rentals and supply continues to lag, that will also start to change,” Zillow Chief Economist Dr. Svenja Gudell said in a release. “As more formerly urban renters move to the suburbs in coming years, we’ll likely start seeing more apartment buildings and walkable amenities popping up in those communities,” Gudell said. As many of you know my companies ...continued on page 4 Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

Forget the Millennials, the Baby Boomer Renters Want Apartments

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he current trends in apartment development are suddenly attracting a new kind of renter, Baby Boomer renters over age 55 who want to live in apartments in the suburbs, according to a new study. These potential new tenants are highly educated and have no children in the household. “Whether driven by a change in lifestyle, a consequence of the housing crash, or an inability to downsize due to lack of ...continued on page 6

Can I Say “No Pot in My Apartments” When It’s Legal in My State? By John Triplett Rental Housing Journal

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alifornia just became the world’s largest legal marijuana market. When pot is legal in a state, what issues does this present to property managers and landlords of rental properties? This was Rental Housing Journal readers’ top story in 2017 Property managers are often confused and seeking to better understand how to handle the issues of legal marijuana and medical marijuana when it comes to tenants and rental housing in their states. Laws are changing all the time in many states, just as California did on January 1, 2018, as voters approve different levels of permission when it comes to marijuana. This leaves property managers trying to figure out what should be in their leases around the issue. You may be able to ban smoking, but do you really know what your tenants are eating or growing in their apartments? Do you really want to know if they are good paying tenants? Rental Housing Journal did a recent interview with Seattle, Washington attorney Bret Sachter, an expert in tracking

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the progression and transformation of marijuana laws, to discuss some common questions property managers have about marijuana and tenants. “I’ve been asked this a lot,” Sachter said, “but it does not come up as often as you might think. The overarching issue here is that, with few exceptions, people can do what they want to protect their property, even if the prohibited behavior is not illegal. You can prohibit smoking, prohibit pets, but with marijuana it’s much easier because it is federally illegal. So you can pretty much prohibit it if you want to no matter what, even medical marijuana,” Sachter said.

4 questions about pot, tenants and apartment leases

as HUD is concerned,” he said. Here are his answers to four questions on pot and apartments.

No. 1 - Tenants with a disability and medical marijuana

Question: If a tenant comes in and says I have a disability, here is a note from my doctor, I use medical marijuana, which is legal in this state, and I want to rent your apartment. Can a landlord prohibit that? Answer: “A landlord can absolutely prohibit that because marijuana is illegal under federal law.” The landlord can say, “I understand our state allows medical marijuana but as it is still a Schedule 1 drug and I prohibit it on my premises.”

No. 2 - Marijuana is legal in my Sachter says in terms of Fair Housing state - but what does the lease issues, and the U.S. Department of Hous- say? ing and Urban Development (HUD) it is a situation where HUD wants it in the lease that marijuana is illegal but enforcement is another issue, he said. It is not so much that HUD wants landlords to evict over marijuana, but that you have something in the lease language that allows for eviction in the instance of marijuana use on the property. “So it is pretty clear as far

Question: What if a tenant says marijuana is legal and they should be allowed to use it? Answer: “If your lease prohibits smoking and prohibits use of illegal drugs, then the legality of marijuana at the state level is irrelevant because under federal law marijuana is illegal. If your lease does not ...continued on page 7

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