Hoboken's Rent Control Issues - Question On Ballot

Hoboken's Rent Control ordinance has sparked controversy for the last few years following exorbitant law suits from tenants seeking compensation. And most recently an amendment set a cap on damages paid to tenants that sue their landlords for their rents not being appropriately registered with the city. Thankfully, after last year's voting mess, this election season,  rent control will make it's way on the ballot.

You may remember last year people walking around town wearing billboards saying Vote Yes or Vote No to the proposition sparking criticism from tenant's rights groups that said their people misinterpreted the question as it's wording was confusing thereby asking voters to vote 'against tenant's rights' when their intention was for the opposite effect.

Well, the question is undergoing scrutiny once again, as the city and Mayor Zimmer claim that the wording, is confusing. And confusing it is!!

In a statement release on www.hobokennj.org 's website, Mayor Zimmer says that in order to protect voter's rights they need to be able to understand the question. In it's current form it reads as follows:

Shall the City of Hoboken continue annual rental increase protections for current residents of rent controlled properties but allow property owners to negotiate rents for vacant apartments and exempt buildings with one-to-four units and condominium units from the rent leveling ordinance by adopting the proposed amendment to Chapter 155 of the Code of the City of Hoboken?

If you don't know much about the current rent control ordinance, or perhaps what Chapter 155 is, or have a hard time with a question posed like this, needless to say, this would be difficult to interpret. It would require concentration, and reading the question over several times.. like it did for me - and I know what the rent control ordinance is about!

Now the statement below, is how the Clerk is proposing the question be phrased:

Shall Hoboken’s Rent Control law be amended to provide that upon vacancy, buildings containing 4 or fewer units that are now covered by rent control become exempt from the City’s Rent Control laws, and that buildings containing more than 4 units that are now covered by Rent Control, upon vacancy, be permitted to charge the new tenant a market rate rent, while continuing to be covered by the other provisions of the City’s Rent Control laws such as the limitations on annual rent increases and other tenant protections?

This ordinance has caused many home owners losses in potential rental income as well as difficulty selling. It's come as bad timing, because with the real estate market depreciation it forced would be seller's to rent their condos, but it also left them unable to reap the benefits of a strong rental market with high demand and high rents. You see, many apartments that have been converted to condo's over the years, have never had their 'rents "registered" with the city, so the town has outdated records dating as far back in some cases as 20 years ago!
   
 Lori Turoff of Hoboken Real Estate news made a few interesting points on her post last March

Personally as a home owner, I feel that an individual condo owner should be able to set a rent amount of their choosing, if it's high or low that should be their decision. Rents are dictated by the market, when things are slow prices come down and landlords pay broker fees, when they're hot, the opposite happens. If the rent is too high no one will their apartment just like if a home is priced to high - no one will buy it.

This ordinance should really be applicable to the Applied Housings of Hoboken, the Archstones and those larger rental buildings who change their rent prices almost weekly increasing sometimes more than 5%

We're already seeing, this hurts real estate values by turning away potential investors, and it also hurts home owner's pockets if they aren't able to collect rent that comes close to or cover's their monthly carrying costs, which when you include property taxes and maintenance fees add up very quickly.


Whatever your feeling on this, you may own a condo of your own one day, do you want an outdated ordinance dictating your market rent? Or should that be up to the market and the tenants themselves?


What are your thoughts? What do you think about Hoboken's rent control ordinance, will you come out to vote this election?

Hoboken Rentals | Holding On To Good Tenants

Hoboken Rentals Holding On To Good Tenants 

Holding on to Good Tenants

Many property owners have been backed into the role of reluctant landlord in recent years, opting to hold their properties as rentals until the prospects of selling real estate improve. In the present landscape, landlords who have an existing relationship with a tenant who has proven his or herself both fiscally reliable and personally responsible count themselves lucky. Don't get caught in the trap of taking a good tenant for granted. Below are some ways to encourage a favorable tenant to consider extending or re-signing their lease agreement.

Communicate and Strengthen Relationships with Your Tenant

Too often the only interaction a landlord will have with their tenant is during some transactional stage (initial property walk-through, lease signing, move-out inspection, etc.) or when a maintenance/emergency issue arises. This passivity can easily lead to a disconnect between the two parties, as each begins to see each other as just different lines on the monthly rent check. That kind of transactional relationship isn't likely to inspire your tenant with any particular partiality towards you (any more than they would have, say, for their local utility company), and at the same time lends you no insight into the occupants needs or future plans.


While most renters don't want the hassle of an overly nosy landlord (or perish the thought, a landlord who tries to act buddy-buddy with their tenants), tenants will generally appreciate a landlord who periodically checks in to see how things are going. 


Email is a convenient way to touch base with your tenants and is less intrusive then a phone call (never show up in person unannounced). Consider sending your tenant(s) an informal email message every six to eight weeks or so: anything more frequent runs the risk of becoming an annoyance, while checking in only a few times a year is not especially useful for either party.


Keep the tone of these messages friendly, asking if the tenant has had any problems with the unit or needs to suggest any needed or upcoming repairs. By positioning yourself as a helpful owner looking out for the occupant's needs, you will help strengthen the landlord-tenant relationship. If nothing else, a tenant who views you as more than just a bill collector is more likely to give you additional notice if they have decided to move out.

The Going Rate

The value of a good tenant to a landlord is not simply measured by the monthly income generated from rent. The timely payment of rent also provides the landlord with a degree of financial stability, which can be rare in this time of seemingly volatile markets. In addition, responsible tenants serve as dependable stewards of the property itself, avoiding damage and alerting the landlord when repair or maintenance is needed. These factors, in addition to the current rental market, must be taken into account if you are considering any future change to the rental price.


Conventional wisdom tells a landlord to charge market value for rent. But when contemplating a future rent increase, consider whether you are willing to risk losing your current tenant for that potential bump in rent. If your current tenant isn't willing to pay the increased rent, putting the rental back on the market entails built-in costs (cleaning or painting not covered in the damage deposit/rental agreement, plus the inevitable turnaround time that will leave the property vacant). You run the risk of having the property remain vacant for long stretches of time. At best, you may end up renting to a less responsible tenant who causes damage to the property or does not pay rent on time.


Simply put, now is likely not the time to increase rent based on motives of increased profit. If you must increase rent for legitimate reasons related to the property (skyrocketing property tax, for example), do your best to keep the rent increases minimal and provide your current tenant with as much information on why you are making the change as is possible (or prudent).


On the flipside, if you are able to keep the rent at the current rate or are in a position to lower rent to match current market rates (based on all that research you're doing to stay current on rental trends.), make sure to call your altruism to your tenant's attention. To many renters, not having to pay an increase in rent year after year is refreshing. Having rent lowered may feel like a small miracle in their eyes.

Make Timely Repairs

It can be too easy for property owners to view their rental units solely as investments, losing sight of the fact that for the occupants, that space represents their temporary home. 


When problems arise, as they always will, take charge and handle repairs both quickly and effectively. Nothing will erode a renter's confidence in their landlord as much as the poor handling of maintenance issues.


Be prepared for potential problems by keeping a list of recommended repair companies and contractors in the area. Treat all reported issues seriously and communicate frequently with your tenant to fully understand the problem. Most importantly, prove your thoroughness by following up with both the repair crew and your tenant after the problem has been resolved.

Spend on Upgrades

Property owners often will wait until the periods in between tenants to make improvements to the property, in many cases with the intent of charging higher rent for the next round of occupants. 


Landlords who are fortunate to maintain tenants for several years in a row may forgo both smaller and significant enhancements to the home. However, if the overall goal is to keep the property rented to a strong tenant for the most amount of time possible, making gradual improvements that improve the occupant's home life (without causing undue disruption) can make a great deal of sense.


As a landlord, you can't reasonably expect a tenant to put up with any changes or improvements that require major construction or losing use of a room/area for any significant amount of time. But many improvements and enhancements can be made in the period of a single workday with minimal disruption. For example, with the help of a good installer, a kitchen appliance or dishwasher can be replaced while your tenants are at work. 


Smaller-scale upgrades, such as changing out the hardware in a kitchen or bathroom(s), can also go a long ways in improving the atmosphere for your renters. If you've established good communication with your renters, you may even consider asking them which areas of the home or appliances they feel need improvement.

Incentivize

If the rental market surrounding your property is dire enough that the loss of your current tenant almost certainly will result in a long stretch of vacancy, you may consider offering the current occupants significant incentives in order to sign a new lease. You may go as far as offering a month's free rent, pay a specific utility, or pay for the upgrade to a current utility service (such as internet or cable/satellite).


Incentives don't necessarily have to be of a monetary nature, however. If your tenants would be interested, you might consider allowing pets in the property (with or without an additional cleaning deposit) if you did not permit them previously.


 Another option would be to allow tenants to re-paint the interior walls and/or exterior of the home - even going so far as to help furnish paint and supplies. These non-cash incentives can help increase your renter's sense of connection to the property.

Hoboken Rentals | Advice For Tenants Having Trouble With Their Landlord

Hoboken Rentals Advice For Tenants Having Trouble With Their Landlord

A friend of mine recently told me that the property management company handling her rental in Hoboken asked to make changes to her lease. Specifically, he wanted to write an entire new lease without her lease term having ended, to add a new roommate. When she said that she didn't want to sign a new one since she is moving out when her term ends in September, he said "it will be easy for you to find someone to take your place".

I will leave out the name of the management company that said this because I have to believe that deep down, this person knows that what he said is wrong.

He then also told her that the rent would be increased, when she asked how much, he said he wouldn't tell them until they "sign the new lease" and that he'll let them know after.

Another no no.

Tenants you should know that when you sign a lease, the terms set forth within that lease are binding to all parties. If your rental term is 12 months, and you are asked to sign a new lease in the 10th, 11th or any other month for that matter, know that unless it explicitly says otherwise you will be signing another one year lease. In cases where you have roommates, you may not be able to assign your tenancy to someone new unless the landlord expressly agrees to.

So beware:
A. You do not have to sign a new lease until your current one that is effective ends
B. You should not assume that you can transfer your tenancy or sublet to someone unless the landlord expressly agrees that it's ok.
C. In the case where roommates are involved, I would strongly recommend, that you add to the provisions section in the lease (the last two pages) that the "landlord agrees to allow assignment of remaining term on lease to a new tenant pending review of said tenant's credit and income verification" or something to that affect that all of you can live with.
  
Renting Condos:
If you sign a lease to an apartment that is a condominium, you should read carefully to see if your lease has a "condo clause" in it. A condo clause gives the owner, a.k.a. landlord, the right to sell the unit you are renting to a buyer, and, essentially kick you out with just 60 days notice to find a new home.

It's a gray area, in that I don't know if this is allowed prior to the lease term end. In other words, if you sign a lease for one year, can the owner in the fourth month decide to sell and make you move out in the next 60 days after it is sold. I have yet to have a real estate attorney confirm this for me. In this case, I would strongly recommend, that you add a provision to the lease that says something to the effect of "landlord agrees to not sell or transfer ownership of the condo during the lease term. Tenancy will remain in effect, and in accordance to lease agreement, for entire term. Tenant will agree to allow showings to property within 60 days of lease term end". There are some cases where an owner will sell a property with the lease terms surviving the sale, in this case you may not need the clause. You should have a conversation with not just the real estate agent involved, but with the owner directly as to their plans and decide from their what you would like added and agreed to to protect yourself. The owner may or may not agree, if they do not, then you have saved yourself from singing a lease agreement.

Now I'm not an attorney, far from it in fact, but I can tell you that it is extremely important that you protect yourself and add clauses like these in these situations. As a real estate agent we always work to make sure the owner of the property's best interests are met, but we also have to be fair and work within legal limits.

By no means, can anyone, real estate agent, property manager, tenant or owner for that matter change the terms of a lease without express permission in writing by all parties named.

I was upset to learn that my friend was being strong armed by this person. And sadly this is not the first of this company's shenanigans. It prompted me to write this post, and I hope someone else will read it that it can help.

Lastly, let me say this, if your apartment is being managed by a company, you should not be negotiating lease terms with them. You should contact the owner directly and discuss with them. They should provide you with a new lease, signed by them with the terms that you both agreed to.

Bottom Line: Read everything, ask questions, do not sign something you do not understand or did not agree to. Your lease is a contract.