We're not villains: landlords

Sort of begs the question: What is a villain?

I am a renter. My assets amount to my car and my computer. My net income is about $1,900 per month. Rent is about $1,050. That leaves $850 for gas, utilities, cable/internet, and food for myself and my kids. Probably a lot better than many. Still, it is hard to make the ends meet.

That said. The market rate for what I've got now is about $200 more. If I had to move right now, my post rent income would be reduced by about 25%. Within my community, I don't have a lot of options. Three of my boys live with their moms full time. One of my boys lives with me full time. Moving away from where I live would be a hardship for all of them.

Crowley, who has been in Edmonton's apartment business for 30 years, said building owners didn't get any help in the 1980s when they were burdened with huge vacancy rates.

The 1980's were marked in Alberta by the National Energy Policy. Everybody had a hard time then. It must have been hard on Sonny Crowley, senior vice-president of NewWest Enterprise Property Group and a past president of the Edmonton Apartment Association, to have endured that difficult period of Alberta history with the benefit of real-estate assets such as apartment complexes. I'm sure there are a great many Albertans that are thankful not to have his burden.

I do not have his burden. Instead I'm looking at accelerating rental costs without the burden of real assets. I expect most renters are like me. We don't have any fat to get us through the lean. Ironic to hear landlords moan about the 80's. Did they worry about if they would have a roof over their heads? That's what I worry about when the Boardwalk Rental Communities throw large figures for legal fees and then actually, arbitrarily, charge me $50 for a letter.

Landlords crying woe when what they seek is to maximize profits (wring the blood out of the market) regardless of the social costs are villains. The victims of their villainy are the ones least able to find recourse.

Stelmach slammed over housing

From Ajay Bhardwaj's article:

The provincial government, however, counters that its budget provides $100 million for affordable housing and that a task force will bring forward a plan to provide more cash for affordable housing next week.

Price per door in 1997 for apartments in Edmonton (as found in Alberta-ThePerfectRealEstateStorm.pdf published by Prestigious Properties Inc.) was $37,801. Statistics Canada says that the Apartment Building Construction Price Index for Edmonton is 161.3 (1997 is par at 100). That means that our current price per door is about $60,970. The government's budget of $100 million would only buy 1,640 doors in Alberta at Edmonton's prices.

According to Madeleine Baerg of Boardwalk, they would not consider new apartment construction in Edmonton until the rent reaches about $1,600. Which is about double their average rent, in the fourth quarter of 2006, of $820. So, $780 over 12 months is $8,640 per unit per year. So $100 million subsidy would buy, over a 20 year mortgage, about 580 doors. Maybe I'm looking at it the wrong way?

Something needs to be done. As apartments get sold as condos, as potential home buyers fall out of that market because of construction costs and house prices, the rental market gets tighter and tighter. I'm looking at an impossible situation. I'm a single dad with one full-time and 3 part-time boys. If I were just entering this rental market, I would be unable to find housing on my own. But with the kids, I'm not eager to find a room-mate.

Politically, I'm a bit right of middle so generally I'm not keen on government getting involved in markets. But we're not talking about widgets. We're talking about shelter - a basic requirement of life. My bias is against government throwing money at problems as it seems to be inefficient. In the rental market, most of that $100 million would likely end up in Boardwalk's pockets. Their profits are healthy enough that they don't need a government subsidy.

What I would be happy with right now is fairness and protection from corporate bullies. In a tight market, high tenant turnover means rents go up faster. But, I'm expecting, that tenants would tend to not move when faced with inflating rental prices. Landlords who accelerate the eviction process, threaten huge legal costs, charge arbitrary legal costs, and otherwise heighten the litigious tension between themselves and their tenants are corporate bullies. Their goal is to heat up the tight rental market by speeding tenant turnover. Once we're protected from being forced out of our homes then and only then does rent protection have any merit.

Boardwalk policies mitigate rent hike impact on tenants - Really?

I'm sure some of the details in David McIlveen's letter are perfectly accurate. But I might not be living in Sturgeon Point long enough to find out if there really is a $75 cap on rent increase. The current price for the unit I have has already gone up by $100-$200 in less than a year. By the time my lease is up, the rental rate to a new tenant could be over $200. Why would a publicly traded company want me to continue renting from them at a $75 increase when they could make over $200 from a new tenant? Why would they want me to stick around?

$150,000 per year to subsidize lower income tenants is a nice token. But it is just a token. The company's net operating income for 2006 was $192.1 million, up 10% from 2005. Out of their net operating income, they are putting back 0.08% into lower income tenants. The administration expense for 2006 was $17,052,000. The token for lower income tenants amounts to 0.88% of the administration costs. The company owns and operates over 35,400 units. The subsidy amounts to 35¢ per month per unit. The subsidy is good press.

Social responsibility is also good press. It's good for the stock price. What is also good for the bottom line is tenant turnover in a tight rental market. My financial situation is also tight. I've always paid my rent, thanks to a payday loan, but not always on time. The Boardwalk's response is threaten legal action, citing legal costs of $300-$600. Not once did I hear about a subsidy program. Recently, they sent a letter saying that if I'm late again, they will go to court to evict me, costing me another $650 for the pleasure. Oh, I am also to pay the legal cost of preparing that letter.

Contrary to the paperwork I got when I first moved in, I am not a valued customer. I am a liability, just as every other tenant in Alberta, the tightest rental market of their properties. While the sign saying "Rent Protection Since 1999" is good press and good marketing, it's bad for net income. Come live here, but don't stay too long.