Olympia wants further discussion on rent issues

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Olympia's Land Use and Environment Committee wants to have further discussions on rent increases, move-in fees, and rental registration fees as well as a  license and inspection program.

Committee chairperson (and City Council Member) Dani Madrone directed Olympia Housing program specialist Christa Lenssen to do in-depth research on several suggested policies and present them at the committee meeting on Thursday, April 21.

Lenssen and planning consultant Jason Robertson updated the committee on community engagement efforts regarding rental housing as the city explores collaborative solutions to rental problems in the city. 

Robertson said that before the pandemic, the city had started some community engagement projects about housing and received a lot of feedback and ideas from one-on-one stakeholder interviews, focus group summaries, and community surveys. 

The community outreach included meeting with renters, advocates, small landlords and large landlords, and having them participate in the survey.

Out of 200 renters who participated in the survey, 50% said they pay about 30%-50% of monthly household income for rent, not including utilities while more than 30% said they spend more than 50% of their earnings on monthly rent payments.  About 80% said they are earn $75,000 or less in their households.

Rental housing as a registered business?

The committee members wanted to have further discussions and additional research on some policies presented, including rental-unit registration or a license and inspection program. 

Madrone asked the committee staff to start working on what mandatory registration might look like and what fee is associated with it and to research code enforcement on the inspection component. 

Committee member Clark Gilman said 53% or the majority of the population in Olympia are renters.

“We are all rent-burdened right now,” remarked Gilman.

Gilman said providing rental housing should be considered a business and not allow it to be a passive investment.

“I feel strongly that registration, a business license and some periodic inspections, are just baselines.” Gilman remarked. “We want to have minimal fire/life safety, sanitation standard that we maintain.”

Limits to security deposits/move-in fees. 

Some landlords, according to Robertson, use the security deposit as insurance for higher-barrier renters. There were also concerns that limiting security deposits/move-in fees could mean higher rent and tighter screening. 

Among Robertson’s suggestions include lowering up-front costs, abolishing or requiring the return of application fees, providing public/nonprofit funding support for initial move-in costs, eliminating or capping “pet deposits and fees” and “pet rent”, and disallowing the collection of “last month” rent up-front.

Gilman agreed to a security deposit to cover the damage to the properties. However, he wanted to know what the move-in fee was for, adding there should be separate conversations on security deposits and move-in fees. He wanted to look further at move-in costs. 

Gilman wanted to know how are other cities in the state dealing with the same issue, including the limitations on security deposits and if there is a trend of disallowing collection of last month's rent.

Lenssen said Seattle, Auburn, King County and Kenmore all have a move-in fee, including security deposit and any cost to move into a unit, and should not exceed a month’s rent. 

Extended notice for rent increases. 

Robertson said the new State law requires a 60-day notice. However, he said some landlords are open to extending it to 90 days. 

Lenssen informed the committee members that Kenmore requires a 120-day notice for rent increases greater than 3%; 180 days for rent increases greater than 10%. 

In Auburn, she added, there is a 120-day notice if the rent is increased by more than 5%. 

“There are other cities that have similar policies,” Lenssen said. 

Committee member Jim Cooper said he wanted to look deeper into policies that other cities are implementing. “I like looking at mimicking something like that and having it tied to a percentage,” Cooper said. 

Lenssen told the committee members there are other programs in some counties that might be good to look at or replicate in Olympia. One of them is establishing a renter information portal containing rights and responsibilities, rental properties inventory, and how-to resources and directory. 

Other ideas include a moratorium or ban on the corporate purchase of small rental properties or other methods to dis-incentivize selling to corporate rental owners; incentivize landlord liaison, housing connector, and master leases for accepting high-barrier tenants or maintaining low rents.  

Comments

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  • AugieH

    Speaking as the owner of one, single-family rental property in West Olympia, I can virtually assure you that requiring licensing of rentals as a business with registration and inspections will likely reduce the number of properties available to rent. I, for one, will put mine on the market ASAP and laugh all the way to the bank. Go ahead, Olympia, knock yourself out and drive the rental market into the toilet.

    Thursday, May 5 Report this

  • JulesJames

    We want folks to rent out their spare bedrooms, their carriage houses, or their homes for a season or so. Registration programs crush this marketplace efficiency while providing absolutely no benefit to existing tenants. (if the unit is unsafe, enforcement upon complaint works). We should be encouraging methods of homeowners to utilize their empty living spaces. Registration does the exact opposite.

    Friday, May 6 Report this

  • Cobbnaustic

    So they want to fix the rental market by making it harder to rent out your property. LOL typical, Good luck with that.

    Friday, May 6 Report this

  • kenhouse

    I agree with the comments. As the owner of one single family rental, I could sell it now and make more money than renting it. Registration means fees and inspections take time and trouble. Our rental rents immediately when vacate and the tenants stay a long time and don't cause trouble. It is a win/win. The City is trying to fix a national housing problem on its own. I don't think the City regulates the price of plywood at Lowes or groceries at Ralphs when they go up.

    Saturday, May 7 Report this

  • AugieH

    "Kenhouse" and I think along the same lines. My current tenants have occupied my rental for 32 months. They pay the rent on time - a rent I haven't raised since they moved in. They treat the home with care and I take care of them and it. It is indeed a win-win for all. However, if Olympia makes owning a rental so onerous for the landlord, I would put it on the market (and offer it to the occupying tenants first). Since I bought the home over 4 years ago, it has appreciated in (estimated) value by 80%. So, go ahead Olympia and cause me to sell it; that'll be one less rental available to those seeking one.

    From Seattle's K5 news on April 27:

    "Small landlords say Seattle’s rental laws are running small providers out of the city.

    Data from the city, analyzed by the Rental Housing Association of Washington, shows Seattle lost 3,407 properties in 2021. That is equivalent to 11,521 units.

    Roughly 2,500, or 75%, of those properties were single-family homes, which are typically owned by small landlords."

    Sunday, May 8 Report this