info
Google Groups no longer supports new Usenet posts or subscriptions. Historical content remains viewable.
Dismiss
“I Quit!”Another Housing Provider Gives Up - small landlords ruined by regulation
7 views
Skip to first unread message
a425couple
Mar 12, 2020, 10:58:05 PM3/12/20
to
from
https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
Mar 9, 2020,09:30am EST
“I Quit!”Another Housing Provider Gives Up
Roger Valdez
Roger ValdezContributor
Andre Shashaty explains why regulation is making him give up providing
housing. AFFORDABLE HOUSING FINANCE
Andre Shashaty has had enough. After years as a small-scale housing
provider, he’s getting rid of his 22 housing units in Northern
California. The long time real estate professional gave it his all,
trying to make his rental housing work in one of the most harshly
regulated housing markets in the country, California; a state the
ironically beats its chest all the time about its “housing crisis.”
Shashaty turned in his resignation through a post at Affordable Housing
Finance, saying, “I quit!”
Shashaty starts out saying,
“I have spent five years as owner and operator of 22 units of workforce
housing in Sonoma County, Calif. I tried to do reasonably well while
doing good: Make a modest income while offering quality housing for a
very diverse group of working people, including some Section 8 tenants.”
Housing providers, even in the non-profit space, are not mental health
professionals or even necessarily the best real estate people. Many of
the housing providers who have the most affordable rents are smaller
operators. Managing rental property is real work, a job, for many of the
people who provide housing.
A story in the New York Times about the life a small landlord chronicles
this work.
“ The Rent Stabilization Association, a landlord advocacy group, says 70
percent of its 25,000 members are small-property owners, who own one or
two buildings with no more than 48 apartments in each building. Of the
one million rent-stabilized apartments in the city, the association
estimates that such landlords own 650,000 of them. Small landlords
‘provide the most affordable housing stock in New York because they’re
under rent stabilization,’ said Joseph Strasburg, the association’s
president.”
So how are these housing providers — called “amateur” landlords in some
places— rewarded for their work? Shashaty says,
“I no longer have any desire to be a housing provider in California. The
politicians have beaten me down with their constant attacks on
landlords. Because California has failed to produce enough housing to
satisfy the increases in demand from the jobs created here, my fellow
small property owners and I are now Public Enemy No. 1. The statewide
rent control law passed last year, which comes on top of myriad local
measures to regulate us, showed just how little our work is valued in
this state.”
The bizarre vacancy tax being proposed in Los Angeles is but one example
of the regulatory overreach that assumes the absolute worst motives from
housing providers, like keeping units vacant at a loss just to make
their prospective customers suffer more with higher rents when they have
no other choice. This isn’t true. What is true that such regulations
punish housing by adding a needless cost; housing providers only succeed
with steady occupancies and low turnover. As Shashaty points out, this
limits housing supply, boost costs and prices, and then its providers
who get blamed. More rules, regulations, taxes, fees, and fines follow
as does scarcity and higher prices.
And who’s to blame? People who own and operate housing of course!
I spoke with Shashaty who said the problem is politicians who run
governments without any concerns about the unintended consequences of
seemingly helpful laws. Shashaty told me that he predicts all the laws,
like ones complicating evictions, will drive more people like him out of
the business.
“The regulation of evictions means that only very tough managers can
make a go of it. I speculate here, but I predict very detailed leases
with all sorts of prohibitions and possibly a surge in the use of video
monitoring of public spaces. I would expect consolidation of ownership
among bigger companies that have economies of scale and will have legal
departments that can churn out evictions efficiently.”
This consolidation effect, larger companies with the scale and resources
to absorb losses and increased risk won’t help residents — it will drive
up costs. I call it the Taco Bell and taco truck problem. When
governments impose rules intended to punish profitability they think is
present in housing, they hurt small businesses and reward big ones. Make
expensive rules on how to make and run a taco business, Taco Bell still
be fine. But your local taco truck will disappear.
And who had the political power? Not housing providers. Shashaty rightly
points out that
“Providers have zero political power. Politicians are beholden to tax
paying homeowners who don’t want poor and minority people or even
working people to find housing in their districts. Now legislators are
pretending to care about the plight of those with huge housing cost
burdens by attacking providers to get political points while achieving
no meaningful improvements.”
We should all regret Shashaty’s departure.
“It was hard work to provide housing these last five years. Now it's
impossible. It takes far too much work to be compliant, and there's too
much legal and financial risk for even innocent missteps.”
Shashaty doesn’t want pity. He’ll be fine, he says, investing his money
elsewhere. But he warns thousand will follow him. He warns,
“ Housing conditions will deteriorate, and the more rents are
restricted, the worse it will get. The flight of capital away from
California will bring a new era of urban decay, and years from now,
people will wonder why it was allowed to happen.”
Shashaty is right. The race toward the bottom has begun. Will anyone
wake up to this? It’s hard to say. Part of the answer is whether
politicians or a politician of the future, as things get worse in
housing markets, can charmingly repackage what we already know is true —
more housing makes housing easier to get and keep for everyone — as some
kind of innovation. Until then, we’ll do what we can and mourn who and
what we’re losing.
Follow me on Twitter or LinkedIn. Check out my website.
Roger Valdez
Roger Valdez
For the past twenty-five years, I have been involved in public policy in
the areas of education, health, and housing. Most recently I was housing
director at a large… Read More
https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
Mar 9, 2020,09:30am EST
“I Quit!”Another Housing Provider Gives Up
Roger Valdez
Roger ValdezContributor
Andre Shashaty explains why regulation is making him give up providing
housing. AFFORDABLE HOUSING FINANCE
Andre Shashaty has had enough. After years as a small-scale housing
provider, he’s getting rid of his 22 housing units in Northern
California. The long time real estate professional gave it his all,
trying to make his rental housing work in one of the most harshly
regulated housing markets in the country, California; a state the
ironically beats its chest all the time about its “housing crisis.”
Shashaty turned in his resignation through a post at Affordable Housing
Finance, saying, “I quit!”
Shashaty starts out saying,
“I have spent five years as owner and operator of 22 units of workforce
housing in Sonoma County, Calif. I tried to do reasonably well while
doing good: Make a modest income while offering quality housing for a
very diverse group of working people, including some Section 8 tenants.”
Housing providers, even in the non-profit space, are not mental health
professionals or even necessarily the best real estate people. Many of
the housing providers who have the most affordable rents are smaller
operators. Managing rental property is real work, a job, for many of the
people who provide housing.
A story in the New York Times about the life a small landlord chronicles
this work.
“ The Rent Stabilization Association, a landlord advocacy group, says 70
percent of its 25,000 members are small-property owners, who own one or
two buildings with no more than 48 apartments in each building. Of the
one million rent-stabilized apartments in the city, the association
estimates that such landlords own 650,000 of them. Small landlords
‘provide the most affordable housing stock in New York because they’re
under rent stabilization,’ said Joseph Strasburg, the association’s
president.”
So how are these housing providers — called “amateur” landlords in some
places— rewarded for their work? Shashaty says,
“I no longer have any desire to be a housing provider in California. The
politicians have beaten me down with their constant attacks on
landlords. Because California has failed to produce enough housing to
satisfy the increases in demand from the jobs created here, my fellow
small property owners and I are now Public Enemy No. 1. The statewide
rent control law passed last year, which comes on top of myriad local
measures to regulate us, showed just how little our work is valued in
this state.”
The bizarre vacancy tax being proposed in Los Angeles is but one example
of the regulatory overreach that assumes the absolute worst motives from
housing providers, like keeping units vacant at a loss just to make
their prospective customers suffer more with higher rents when they have
no other choice. This isn’t true. What is true that such regulations
punish housing by adding a needless cost; housing providers only succeed
with steady occupancies and low turnover. As Shashaty points out, this
limits housing supply, boost costs and prices, and then its providers
who get blamed. More rules, regulations, taxes, fees, and fines follow
as does scarcity and higher prices.
And who’s to blame? People who own and operate housing of course!
I spoke with Shashaty who said the problem is politicians who run
governments without any concerns about the unintended consequences of
seemingly helpful laws. Shashaty told me that he predicts all the laws,
like ones complicating evictions, will drive more people like him out of
the business.
“The regulation of evictions means that only very tough managers can
make a go of it. I speculate here, but I predict very detailed leases
with all sorts of prohibitions and possibly a surge in the use of video
monitoring of public spaces. I would expect consolidation of ownership
among bigger companies that have economies of scale and will have legal
departments that can churn out evictions efficiently.”
This consolidation effect, larger companies with the scale and resources
to absorb losses and increased risk won’t help residents — it will drive
up costs. I call it the Taco Bell and taco truck problem. When
governments impose rules intended to punish profitability they think is
present in housing, they hurt small businesses and reward big ones. Make
expensive rules on how to make and run a taco business, Taco Bell still
be fine. But your local taco truck will disappear.
And who had the political power? Not housing providers. Shashaty rightly
points out that
“Providers have zero political power. Politicians are beholden to tax
paying homeowners who don’t want poor and minority people or even
working people to find housing in their districts. Now legislators are
pretending to care about the plight of those with huge housing cost
burdens by attacking providers to get political points while achieving
no meaningful improvements.”
We should all regret Shashaty’s departure.
“It was hard work to provide housing these last five years. Now it's
impossible. It takes far too much work to be compliant, and there's too
much legal and financial risk for even innocent missteps.”
Shashaty doesn’t want pity. He’ll be fine, he says, investing his money
elsewhere. But he warns thousand will follow him. He warns,
“ Housing conditions will deteriorate, and the more rents are
restricted, the worse it will get. The flight of capital away from
California will bring a new era of urban decay, and years from now,
people will wonder why it was allowed to happen.”
Shashaty is right. The race toward the bottom has begun. Will anyone
wake up to this? It’s hard to say. Part of the answer is whether
politicians or a politician of the future, as things get worse in
housing markets, can charmingly repackage what we already know is true —
more housing makes housing easier to get and keep for everyone — as some
kind of innovation. Until then, we’ll do what we can and mourn who and
what we’re losing.
Follow me on Twitter or LinkedIn. Check out my website.
Roger Valdez
Roger Valdez
For the past twenty-five years, I have been involved in public policy in
the areas of education, health, and housing. Most recently I was housing
director at a large… Read More
Byker
Mar 13, 2020, 6:29:01 PM3/13/20
to
"a425couple" wrote in message news:r4esr...@news1.newsguy.com...
>
> from
> https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
>
> “'Housing conditions will deteriorate, and the more rents are restricted,
https://www.youtube.com/results?search_query=rents+will+keep+going+up
>
> from
> https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
>
> “'Housing conditions will deteriorate, and the more rents are restricted,
> the worse it will get. The flight of capital away from California will
> bring a new era of urban decay, and years from now, people will wonder why
> it was allowed to happen.'”
> bring a new era of urban decay, and years from now, people will wonder why
>
> The race toward the bottom has begun. Will anyone wake up to this? It’s
> hard to say. Part of the answer is whether politicians or a politician of
> the future, as things get worse in housing markets, can charmingly
> repackage what we already know is true — more housing makes housing easier
> to get and keep for everyone — as some kind of innovation. Until then, we’ll
> do what we can and mourn who and what we’re losing.
Few will pay attention until forced evictions turn into gunbattles:
> The race toward the bottom has begun. Will anyone wake up to this? It’s
> hard to say. Part of the answer is whether politicians or a politician of
> the future, as things get worse in housing markets, can charmingly
> repackage what we already know is true — more housing makes housing easier
> to get and keep for everyone — as some kind of innovation. Until then, we’ll
> do what we can and mourn who and what we’re losing.
https://www.youtube.com/results?search_query=rents+will+keep+going+up
Byker
Mar 14, 2020, 7:25:18 PM3/14/20
to
"a425couple" wrote in message news:r4esr...@news1.newsguy.com...
>
> from
> https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
And it's not just the U.S.: https://www.youtube.com/watch?v=5fy3GdTxqj8
>
> from
> https://www.forbes.com/sites/rogervaldez/2020/03/09/i-quitanother-housing-provider-gives-up/#1aaca58836c5
0 new messages