An Addition to My Written Testimony Regarding the 20 Anti-Landlord Bills

This is in addition to my original Testimony regarding these anti-landlord bills.

1. Sen Eldridge at hour 2:03:30 mentioned that landlords can collect 4 months rent upfront to justify why he is proposing that they collect only 2. As he was on the Housing Committee for many years he knows very well (or should know) that by law landlords can only ask for 3 rents (First, Last and Security plus a small fee to change the locks). Maybe he means the 1 month rent that Realtors charge if you go thru them but going thru them is optional. So his statement is intentionally misleading and inflammatory.

2. Having 20 bills to discuss and only giving 3 mins to a landlord (and out of 160 participants there were only 5-6 landlords) is exactly 9 seconds per bill and the first landlord was allowed to speak only after about 2.5 hours of tenant testimony. Why would you do that?

3. No one is arguing with all the tenants and their advocates that there is an Affordable Housing Crisis. It’s a fact that there is not enough housing, that prices are too high, that it is difficult to find available apartments and that it is traumatic to get a rent increase or to have to move because of it. No one is arguing with that.

4. What we disagree is on the ways to fix this. The pitchfork and torch mob thinks that landlords are to blame and they want to cap the rents by law (Funny, no one is talking about capping our expenses too – last week I got my new tax valuations from Athol which jumped with 20%, 30% and one of them was 47% higher than last year, we can’t find available plumbers (because supply is kept artificially low by requiring residential plumbers to school and apprenticeship for about the same length as an architect) and when we do they ask for $300/hour, insurance companies routinely increase yearly premiums by 10% or more, etc). The bottom line is this – landlords are not to blame for the Affordable Housing Crisis not to mention capping rents will backfire with its unintended consequences – less new and used apartmemnts on the market, lower valuations and lower taxes for the state.

6. THE REASON prices are high is because of the Federal Reserve low rate which allows you to borrow more for the same income and once you pay more for the property you feel you need to justify that to the banks so you can get back cash from the new purchase by raising the revenue from the property by increasing the rents. But THE REASON some landlords are even able to jack up the rents is because the supply of new and used apartments is low, there is almost no competition because of the 30-40 year assault on the property owners thru over-regulation and restrictive zoning all of which makes it risky or impossible to rent used units or build more except for the very large landlords.

7. Mayor of Somerville said 69% of purchases are cash transactions. The reason that is happening and will be happening more and more is because of what I mentioned in #6 and because by passing bills like these you are killing the small property owners and only big landlords can survive. Again, what needs to happen is to throw these 20 bills down the toilet and NEVER bring them up again and IN EXCHANGE tax the landlords to create Eviction Insurance just like you have Unemployment Insurance to provide a real safety net to tenants. So a) stop the assault on property owners by proposing bills like these, b) make life easier for them by allowing mandatory rent escrow and simplifying the Sec Dep laws among other things, c) you can’t do anything about the low Federal Reserve rate but you could outlaw dangerous products like ARM and Balloon loans in MA, d) change zoning laws and increase incentives to new construction and e) create Eviction Insurance as a safety net to displaced tenants.

8. Out of about 160 testimonies I liked best Jack Perenick’s at hour 5:52:50 of the hearing (and I loved the weak response coming right after his testimony by Sen. Jehlen who clearly did not expect to be caught with her paws in the cookie jar). Jack is a resident of Somerville  and renter who was very perceptive in noticing the dirty tricks politicians like Mike Connelly and Sen Jehlen play who say “don’t worry it’s not a repeal of rent control for the whole state we are just giving the option of towns to enact rent control or not enact it if they choose and don’t worry new construction is exempted from rent control”. Jack noticed that towns who want to enact only “just” evictions will be forced to enact rent control too because of the way the bills are written. He also noticed that the rent increases are capped at 5% rather than inflation plus 5% which means that if inflation is 7% like it’s this year (or 18% like it was in the early 80s, my addition) the landlord is forced to eat it  (like the $1500 lead paint removal credit which was never adjusted annually with inflation and has been fixed since the 70s, my addition). Also he noticed that the new construction exemption is also a slimy trick because it doesn’t say for how many years they are exempted – is it for 15, 20 or forever or they are just going to be tricked to invest and build that new housing and then get rent control imposed on them the next year?