Updated: Aug 23, 2022
While there is no doubt that a rental registry could be a valuable tool for Sidney, City Council needs to be cognizant of several issues before proceeding.
Public reception: While the public generally accepts and desires regulations for maintenance of rentals, there will most assuredly be loud and vigorous opposition to the proposed regulations from some sectors.
Staff capacity: Rental Registration and inspections will require considerable amount of staff time. A registry will not accomplish the desired goals unless it is pursued diligently by dedicated staff. Vacant Property Inspector time will have to be reallocated between the Vacant Property Registration ordinance and a Rental Registration Ordinance.
Time: A rental registry is not a cure all or instant solution to poor landlord stewardship. It will take a couple of years to begin to see change.
Next Steps Staff recommends the following:
Proceed with Drafting regulations similar to what has been adopted by many communities in Ohio
Complete a comprehensive database of rental properties, their conditions, and ownership"
Slum Lords and crime
A Slumlord is a Landlord that allows their properties to deteriorate and don't qualify tenants that rent. The "you have money I have space" leads to troubled a neighborhood. In a Recent Article the Landlord Liette had a stabbing at his property on Buckeye and Park Street. Additionally within 1 week. There was a Drug raid on a house on Park Street near Buckeye and a domestic violence incident that lead to 6 officers being called to the scene. Landlords such as these and others that do not care for the properties also effect landlords reinvesting into properties nearby. The are effected in the form of vandalism, unsafe streets, and squatters.
Personally as an investor I purchase distressed properties. Situations I find tenants living in are often quite poor: From roofs, piping leaking and sewage filling up inside walls, dangerous electrical situations and fire hazards, roach and bedbug infested properties. Conditions that tenants have resigned themselves too in order to pay a slight discount in rent compared to properties that are upkept and managed well.
Properties are left vacant after poor conditions are eventually condemned and destroyed by the landbank. These demolitions cost tax payers thousands of dollars and decrease rental capacity
Limited Rental Capacity
Tenants now find themselves lacking in available options for rental prospects in Sidney. Waiting lists at many apartments are 3-5 months out with lists as long as 70+ applicants. Tenants find in this lack of supply market and high demand that their idea what is fair for rent doesn't equal to what a good property costs. Costs include massive jumps in Labor, material, taxes, and losses from Covid. Roof replacement just 5 years ago for buildings that would average $14,000 dollars are now more then doubled at $30,000 dollars. Shortage of supplies are leaving properties vacant longer. For example a 6 pack meter box to run commercial power to a building has a 6 month lead time. Properties through out the city have been abandoned are often held up in Probate court, banks are unwilling to foreclose on even owner occupied properties bringing more distress to the neighborhoods.
We all know good landlords that take care of their tenants and properties. The costs to keep a property well maintained eats into further investment costs. For example, the cost to flip a single family home is $40,000- $60,000 dollars. With purchase prices often equal to the cost of repairs in reverse. A slumlord can outpace a good lord 2-1 in property purchases.
Without a registry to level the playing field slumlords have no real incentive to develop their investment. In fact depreciation of properties encourage better tax solutions currently.
The Real Estate Round Up is a group of investors in the city that had some additional ideas to provide solutions to the housing shortage that is effecting the city:
Abatements and Taxes that are levied again vacant or distressed properties are generally sold solely to a company in Texas, Tax Ease. When the company purchases the tax lien on the properties they will access a %15 fee on the taxes owed. They will eventually foreclose on the property and auction the property off. At which point wholesalers out of Columbus and Lima will purchase the property and piece them out to investors. Investors pay additional costs to take over the properties or the properties will sit for a significant amount of time. If the tax liens were instead sold to local Socially Responsible Investors. The properties would be turned over more quickly and at a lower cost.
If the city plans to inspect properties prior to their introduction to market. Then as a licensed landlord that has had it's properties inspected by a government entity. They should be offered a higher degree of protection by the city. Just as utilities who have damage from car accidents taking out a telephone pole. Vandalism and purposeful property damage should be prosecuted though citations. Currently the Landlord is responsible to bring a civil suits against tenants. Often times even after winning a judgement the landlord will not receive any real relief for damages to the property. A licensed property that has been inspected by a government authority, that has the property damaged to the point by the tenants that it no longer qualifies the landlord to rent it out. That tenant then should be charged by the city authority for damaging the rental property. This would encourage more investors to purchase and develop properties in the city. Punish bad tenants that discourage good landlords for developing that property.
Finally their should be an oversight board for rental properties specifically. Comprised of city officials, landlords, and community agencies aiding tenants. We have all faced over zealous inspectors, disruptive tenants that cause damage and then report the damage they cause, and landlords that think regulations are unfair because of the costs to improve on investments. A tempered registry that is enforced to achieve the goals of safeguarding good properties is the right choice for Sidney Ohio.