My husband and I bought and sold small apartment buildings for more than 47 years. Recently we sold our last two apartment buildings. We are done with owning and managing multi-family housing.
It’s bittersweet for us. I loved being a hands-on owner. I loved improving the properties to make them a more desirable place to live. Our tenants were our priority. What was needed at the buildings took precedence over what was needed in our home.
In our last two buildings, we worked to build a sense of community. We hosted off-site tenant appreciation parties for our residents, movie nights, and published regular newsletters. We had wedding receptions in our courtyard. Tenants became engaged and married while living in our properties.
Two individuals met in our building and recently tied the knot in our courtyard. In my heart I celebrated these wonderful occasions. Our residents became my “apartment family” and I was the “apartment mama.”
For me, owning and managing apartments was not a business; it was a way of providing housing with value-added benefits for our residents. We issued modest rent increases every two or three years — and yes, all our apartments were under market rate.
However, over the past few years, in the eyes of some, owning apartments became synonymous with being a greedy landlord. Local, state and federal legislators felt they needed to protect vulnerable tenants from their onerous landlords.
Some of the more egregious pieces of legislation did not pass:
- One would require owners who planned to sell their building to first offer it to their tenants, and nonprofits and allow one year for them to find financing.
- Owners of five or more rental units would be required to provide specific information into a state registry requiring an abundance of private information, invading the privacy of tenants and at significant cost to owners — and to what end?
- Owners would need to disregard the criminal backgrounds of any applicants.
- The state proposed to regulate the kind of outdoor LED lighting fixtures utilized on apartments to reduce light pollution.
- Any building with a dwelling unit would be required to provide cooling or it would be deemed substandard.
Many legislative proposals at all levels of government did pass and below are merely some examples:
- Rent control was the first.
- During COVID, with job losses, owners were mandated to find out which tenants couldn’t pay their rent and needed rent forgiveness or special arrangements for repayment.
- For tenants who qualified for assistance, a labyrinth of governmental bureaucracies awaited owners who had to go through the process or not see the rent they were owed.
- Confusing and conflicting laws from local jurisdictions, as well as at the state and federal level, prohibited the eviction of any tenant, even when they were a danger to neighbors.
- Apartment buildings meeting specified criteria were required to install new fire alarms, an unfunded mandate, costing us over $35,000 for just one small property
- More local inspections of our buildings by the fire department were instituted, at a cost to the owners.
- At the local level, our residents had their nearby street parking virtually eliminated.
- Balcony and deck inspection deadlines are rapidly approaching, and now costly conversion from gas to electric is on the horizon.
We felt we had lost control of our properties. We lost the ability to provide certainty for our renters. What was next?
By now, we had been retired from our full-time jobs for several years. We were just a small “mom and pop” operation. We had hoped that owning an apartment building would help to build a little nest egg to help us through our retirement years, and maybe even enable us to retire a little earlier. However, with the rents we charged and the expenses we paid, retiring early was just a pipe dream.
How many other responsible apartments owners have decided to call it quits under the burden of unfunded and unreasonable government mandates. And who will be left?
Diane Strum is a former rental property owner who lives in San Diego.