Nenshi stirs up a hornets nest with his landlord gouging comments

[Bunk]

Dp

[ranchlandsselling]

Originally Posted by OldDutch

So maybe Nenshi is speaking of the skezzy land lords who buy a bunch of property and rent it out as their business. Who knows. All I know is many people trying to do it on the side are not making a lot if anything, many do charge a lot on the face but being a PT land lord is not a easy gold mine by any means.

Ummm? huh?

So homeowners who buy a condo, move, rent it out are ok, but people who do it as a business are "skezzy".

The whole landlord / rental market has some serious image problems that seem to be based purely on ignorance.

I remember renting out a townhouse years ago. Buddy split with his girlfriend who he rented the place with and moved out. Left her in the house but he was paying the rent (as he was on the lease). He survived a few months, then the cheques started to bounce. Finally tracked him down, he gave me a sob story and then told me "this is my life, for you this is an investment". I had to negotiate a lower rent with the GF until I could find a takeover tenant and let her stay vs. battle it out to boot her.

As if it's my responsiblity to deal with his life problems and allow them to become my life problems. So you don't pay the rent and I should accept it because you're hard up, but then I can't pay my mortgage and I become hard up?

The life of a skezz I guess! Not that I own and rent out property at this point in time.

[Bunk]

Originally Posted by CaptainYooh

I see a huge wrong in Nenshi saying that. That's the problem with Nenshi on and on and on again. Populism is not good government, never is. Provision of subsidized housing options is up to the City of Calgary with the funding assistance from the Province. Period. He has ZERO stance criticizing landlords, not in the anecdotal sense nor in general, as he did last week. The City does not help landlords, nor does it help renters; therefore, it has no right to offer opinions on what's fair and what's not fair. Especially, so blatantly wrong and broad brush opinions.

Most landlords are buying properties with a 25-yr mortgage and returning 5% on their investment capital after all expenses paid. This is not gouging anyone. They are just trying to keep up with the market and costs of property holding. Are there bad landlords? Yes, just like there are bad teachers, doctors, lawyers, engineers, developers, city workers etc. It is not Mayor's job to profess casual accusations against industries. His job is to lead City Council in achieving good municipal governance, which he has not been very good at so far, unfortunately.

Affordable housing is NOT primarily the role of the City. It's the Province. City of Calgary has a role through CHC as a landlord and limited programs through OLSH, but it's not primarily the City's responsibility. It doesn't help that the Province has virtually stopped funding housing programs as part of the ten year plan to end homelessness. There simply isn't any money flowing. If we want to massively increase affordable housing through City sources, we have to massively increase property taxes, which we can see will only get the City accusations of gouging taxpayers.

Second - Again, where did the Mayor accuse a whole industry?

Ask home builders what the city's policy of increasing urban development at the expense of suburban growth has done, and they'll tell you it's created the housing crunch they predicted long ago. No matter how much the city may try to force condo living on the masses, people will want yards. Without new development farther out, this increases the cost of the houses that already exist (or moves people to outlying areas where they don't pay for Calgary city services). This further puts lower income homeowners into the condo market, which takes away from the rental market, putting people into the Drop-In Centre.

There is no policy to "increase urban development at the expense of suburban development. The City will enable both through policy and infrastructure, and the market will decide. The City adhere's to its policy of a minimum planned and serviced land supply in suburban communities.

The homebuilders that are having trouble finding lots tend to blame the City, but it's really the vertically integrated Mattamy's of the industry that are causing them the problems they find themselves in. The fact is that housing starts are at a record level in this city.

Originally Posted by Regorium

I'm a bit surprised at Nenshi here. Generally he makes very smart statements and will show very strong understanding of whatever topic he's trying to talk about.

But this is just absolutely crazy. Doesn't understand how his own policies have created a housing shortage (I agree with those policies - I'm a latte-sipper). Doesn't understand a market economy.
.

How have his policies created a housing shortage exactly?

[CaptainYooh]

Originally Posted by Bunk

...How have his policies created a housing shortage exactly?

I do understand that you are responding to another post; but this discussion doesn't belong here, Bunk, I believe. It is a much wider and more complicated topic.

[CaptainYooh]

Originally Posted by Bunk

Affordable housing is NOT primarily the role of the City. It's the Province. City of Calgary has a role through CHC as a landlord and limited programs through OLSH, but it's not primarily the City's responsibility. It doesn't help that the Province has virtually stopped funding housing programs as part of the ten year plan to end homelessness. There simply isn't any money flowing. If we want to massively increase affordable housing through City sources, we have to massively increase property taxes, which we can see will only get the City accusations of gouging taxpayers.

Second - Again, where did the Mayor accuse a whole industry? ....

To your first point:
1) Yes and no. The City is not just a contractor building taxpayer-subsidized housing at the request of the Province. The City's role is to plan the demand, manage the housing stock, advise the Province and negotiate the budget for the subsidized housing projects just like any other municipal jurisdiction. The Province only distributes the money.
2) Who said that we all want to increase taxpayer-subsidized housing massively? As a City, we all want to have enough housing stock to keep up with the market demand. This is achieved through a combination of good planning, good administration and good business-friendly environment for housing suppliers. And only then - through the taxpayer-subsidized housing supply.

To your second point:
from Metronews: "The mayor accused some local landlords of looking at their business as “a get-rich-quick scheme.”

Another example: “If it’s crap, if you know it violates guidelines and complain it takes too long to get approval, you know why,” Nenshi told about 250 members of the Calgary Chamber of Commerce."

To me, both statements are broad-brush accusations against the industries.

[V]

His very statement that price should increase in line with costs is a statement against the entire industry, as there are probably less than 1% of the landlords out there that haven't risen prices in accordance with demand.

[OldDutch]

Originally Posted by ranchlandsselling

Ummm? huh?

So homeowners who buy a condo, move, rent it out are ok, but people who do it as a business are "skezzy".

The whole landlord / rental market has some serious image problems that seem to be based purely on ignorance.

Woah woah woah. I didn't mean that. I meant the small percentage of people doing this within the subset of people who run it as a business. I only meant the "slumlord" subset which I didn't mean all people who do this. Going back I can see how you inferred that but it was not what I meant.

Looks like I now get why Nenshi stepped in it. I'll back away now.

[SebC]

Want more affordable housing? Upzone.

[Bunk]

Originally Posted by CaptainYooh

To your second point:
from Metronews: "The mayor accused some local landlords of looking at their business as “a get-rich-quick scheme.”

Another example: “If it’s crap, if you know it violates guidelines and complain it takes too long to get approval, you know why,” Nenshi told about 250 members of the Calgary Chamber of Commerce."

To me, both statements are broad-brush accusations against the industries.

Maybe you misunderstand the meaning of "some" as being "broad-brush". Infact, it's the opposite meaning - isolated, narrow.

Second - that comment was specifically with regard to large scale regional commercial centres and the large commercial guidelines that were being produced with industry at the time. Really easy to paint an out of context quote as broad-brush, but also very misleading.

[bizaro86]

Bunk - Is it the mayor's position that pricing rentals above a landlord's cost/raising rents as house prices rise is unethical?

[Bunk]

Originally Posted by Ozy_Flame

I don't think it's a stupid comment. If he's receiving complaints from tenants about unethical landlords, why can't he say anything? He's not painting all landlords with the same brush. If anything, someone in his position can get the public talking about it.

No harm done, IMO.

Exactly - never did he paint everyone with a broad brush. The opposite in fact.

But, the story in the herald was that he "tarred the industry" which left the impression he painted all the landlords the same. He didn't.

[Bunk]

Originally Posted by photon

He should be telling those people to call Service Alberta about their landlords breaking the law without correct amount of notice.

And there's reasonable reasons for a large increase, if a place hasn't had a rent increase for a decade, someone buys it, and has to increase rent by 30-40% just to bring it up to cover the mortgage. Or the owner was okay with low rents because they bought it 20 years ago but brings it up to market value because they pulled some money out.

That's what we do when we get such a complaint it seems laws are not being adhered to - refer people to the correct resources.

[Bunk]

Originally Posted by rohara66

Just to clarify but if the lease is ending the new lease rent can be raised as high as the landlord wants.

At the end of the day its supply and demand.... if Nenshi has a problem with the demand than maybe he should get council/planning/city on board with expediting development approvals and construction in the City to create more supply.

Development approvals are only a part of the picture. But we are expending a lot of effort trying to improve the planning system. Industry capacity to handle the amount of growth we have is also a factor. Also, market housing is only a part of the picture. By and large the market serves us well, but there is a role for non-market housing for those most vulnerable. Unfortunately, this is badly underfunded and we're falling behind.

[Bunk]

Originally Posted by Hesla

Yeah ... Nenshi is in the wrong here and usually i find myself agreeing with him.

I took a loss on my rental condo for 3 years and now i have a very small gain based on the market value of my area. My rent in 4 years has gone up on average $50 / year.

Is this gouging ?

Of course not. It's a little like porn - not easy to define exactly, but you know it when you see it. Incremental $50 increases in rent in an inflationary market, clearly not gouging. Suddenly jacking someone's rent 40% because they have no other choice other than to pay it or literally be homeless in a zero vacancy market? Probably taking advantage of someone. Probably gouging.

[ranchlandsselling]

Originally Posted by OldDutch

Woah woah woah. I didn't mean that. I meant the small percentage of people doing this within the subset of people who run it as a business. I only meant the "slumlord" subset which I didn't mean all people who do this. Going back I can see how you inferred that but it was not what I meant.

Looks like I now get why Nenshi stepped in it. I'll back away now.

Hey, this is CP, you give someone an opening to take your posting in its most literal sounding way then they have an obligation to jump on you, as members of the posting community we the owe everyone else on the board that much.

I couldn't have possibly asked for clarification and waited for you to explain yourself. That would have taken 51 minutes, and what it you had worded yourself as you meant, then I'd have lost the opportunity to jump on you and someone else might have.

[photon]

Originally Posted by Bunk

Probably taking advantage of someone. Probably gouging.

Maybe, but is that wrong? All business is about taking advantage of someone to some degree.

I ran my condo at a loss for many years because everyone and their dog bought presales of condos then after the market tanked they still had to close and then rented them for whatever they could get. Drove condo rents down, I was renting for something like 55% of what I was getting, my costs certainly didn't go down by that much.

Were the tenants taking advantage of me? Were they gouging me? In the same way that the landlord upping the rent because they can they are; they could go get another place or they'd take mine for cheap.

No one gets in the news about unethical tenants though.

Don't really have a point other than the line between "market" and "unethical" doesn't seem clear enough to easily comment on.

[Dion]

Originally Posted by Bunk

That's what we do when we get such a complaint it seems laws are not being adhered to - refer people to the correct resources.

With the rental market being what it is and people fears of evictions if they complain, how many of those complaintants actually follow through on the that advice?

[Dion]

Originally Posted by Handsome B. Wonderful

You'll know you're gouging when you can't find tenants. Otherwise I say take as much as you can get. You're not running a charity.

If you have a property that's mortgage free and you choose to jack rents like everyone else, I would call that gouging.

Landlords that refuse to put some of their profits in to upgrades an maintinence would also be considered gouging in my view.

[1stLand]

My tenants lease is coming up.
I was going to jack up my rent an extra $400 per month to reflect current market rates.

But since Nenshi would disapprove I am going to keep rents as is.

Need to wait until we get a new Mayor to raise my rents. Hmmpph!

[Dion]

A good friend of mine owned a rental property for a number of years. He did his best to screen applicants but for whatever reason ended up with bad tenents. It became a huge hassle when he would have to cut the grass when the renters refused. Or having tenets that wouldn't lift a finger to keep the place clean and respectable.

In the end he got tired pouring money into his property for damages the tenets caused or unpaid rent they refused to pay.

Landlords are not always the bad guy in these situations.