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Do I have to accept Section 8 Tenants?

4/12/2012

3 Comments

 
This is a common and somewhat tricky question I hear from our property management clients. Can I refuse to rent to Section-8 tenants, or do I have to accept them?

What is Section-8 and the HAKC? I sum that up in this article!

Like most things the government is overseeing the answer is as convoluted and difficult as figuring out your taxes. While it may not be illegal on a federal level it may be a violation of some statute or regulation in your state or municipality.

New York, for instance has ruled that refusing to accept a section 8 voucher from an existing tenant is somehow discriminatory. I have attached a document below detailing that court battle.

While that ruling appeared to address only existing tenants who later qualify and receive section 8 funding, it left open (at least by my reading) the choice of refusing to rent to section 8 tenants who are applying to rent your property. That said I wouldn't want to be the one facing some liberal New York judge to be the test case for their axe to grind.

By the same token, a California court has held that a landlord may refuse to accept section 8.  I will also attach that document below.

In a case with important and lasting implications for landlords, the California Courts of Appeal has found that a landlord may legally refuse to participate in the Section 8 Program.1 This important case interprets the California Fair Employment and Housing Act (“FEHA”), and in particular, California Government Code Section 12955 which prohibits discrimination based upon source of income. The Court of Appeal’s decision ends several years of conflict between tenant advocacy groups and landlords who disputed whether FEHA prohibited a landlord from refusing to accept Section 8 rental assistance payments.

Once again this was decided, as well it should be by a State Court and not a Federal Court! But the fact remains that none of us want to be the bellwether case that makes it to the Supreme Court of the US!  Most of these cases are handled outside of a courtroom because of the heavy-handed tactics of HUD and their contractors most of these cases never see the light of day. Most landlords are frightened into submission and settle before it ever become public.

You can read how HUD uses extortion and coercion to entice guilty pleas form their victims in this article, Fair Housing Truths and Myths.

Since our clientele is mostly investing in the Midwest, how do these two extremely liberal state court rulings affect us here in fly-over country? The answer is simple what happens on the coast is usually a harbinger of what is to come to the rest of America.
PictureObama Pool Lift
Sadly as America drifts more closely to the shores of shared misery brought to you by socialism and liberalism, we also are drifting headlong into more and more government intrusion in our lives and our businesses. This year because of a new pool regulation my favorite public pool won't be opening. This pool was operated as a not-for-profit and on a shoe-sting budget. With the new Obama Pool Rules they simply cannot afford to open.

So here are my suggestions on dealing with this question:
  • Never advertise or state that you do not accept Section-8
  • Have a written policy of minimum criteria for rental applicants
  • Always state that the home MAY NOT QUALIFY for section-8! Since most housing authorities have inspection requirements there is as yet, no law requiring you to submit to those inspections or make their required repairs. 
  • If asked if you accept section-8 your response should never be no!
  • If a tenant with a section-8 voucher wishes to apply for your rental unit DO NOT REFUSE! This could be seen as discrimination and wind up getting you into a big mess. You should take the application and explain to them your policy of minimum criteria for rental applicants! 
We are not lawyers, please do not rely on us for legal help! If you are unsure of the laws or regulations pertaining to your questions please seek the professional help of an attorney!  DISCLAIMER


3 Comments

Kansas City, MO Rental Property Registration

2/14/2012

0 Comments

 
As I have pointed out before, Landlord Licensing is nothing more than a TAX!
Picture
Here Comes the Judge!
While we were able to keep it from becoming a tax in Kansas City, MO they still did enact a requirement to register your rental property.
Don't Forget -- Rental Registration is required for rental properties in
Kansas City, Missouri.

The City of Kansas City, Mo., is issuing a reminder to owners of rental dwellings
located in the City in an effort to let them know they must renew or establish registration of their rental properties with the City's Neighborhood and Community Services Department on an annual basis. Annual registration of rental properties is part of the Rental Registration and Inspection Program that was established by the City Council, with passage of ordinance No. 071046 in October 2007.

Registration may be submitted anytime during the month of January without incurring
a registration fee. All rental properties must be registered within 30 days of becoming
a rental property. Failure to register a rental dwelling within 30 days of the property
becoming a rental will result in the issuance of an administrative citation fine of $50.
For each month (or portion thereof) that a rental dwelling is not registered, an
additional $50 fee will be assessed. For example, a property that was a rental in
January, and not registered until August, will be assessed a fine of $350.

Registration is required on a calendar-year basis and expires each Dec. 31.
Online registration is available at http://www.kcmo.org/neigh. Registration forms can
be downloaded and submitted by mail or in person. For more information about the
Rental Registration and Inspection Program, visit http://www.kcmo.org/neigh or
contact Shalisha Boles, Neighborhood and Community Services Department, 816-
513-3200.

 In October 2007, ordinance No. 071046 was passed requiring that all occupied rental housing units within the City limits of Kansas City, Mo., be registered with the City starting Jan. 1, 2008, and renewed each year.  A $50 per month fine for failure to register began Feb. 1, 2008. The current ordinance is online at municode.com.

Registration renewalRegistration renewal may be done anytime during December or January and there is no registration fee. Failure to renew registration of an occupied rental dwelling before February 1 of each year will result in a fine. For each month (or portion thereof) that a registration is not renewed, a $50 fine will be assessed.




0 Comments

"Landlord Licensing" is a tax!

12/27/2011

0 Comments

 
_
What is landlord licensing, how does it work and is it good or bad?    
Landlord licensing is a tax on rental property paid by the owners and often passed on to the renter. It is a system of forcing real estate investors to pay a city or municipality a fee for registering their investment property. It usually involve the periodic inspection of the rental property and the fees are touted as paying for that service.

In difficult economic times cities start looking for ways to increase revenue and often do so by trying to find more fees and penalties to impose on the tax payer.

Usually the tax is pushed forth with the notion that there are broke-down hovels all over the place and that by taxing the owners they will be forced to bring them up to code. It is a selective punitive tax, because it does not target owner occupied homes, while it does penalize owners of rental property.

The effects are as follows:
  • Taxes, fees and costs result in higher rent for the tenant to pay.
  • Landlords become liable to the city for the tenants acts.
  • Inspections are an invasion of privacy and a real inconvenience to the tenant and the landlord.
  • Investment in the community is discouraged; decreasing property values.
  • While codes issues in rental property are enforced, and usually fined; owner occupied properties are allowed to decay without penalty.
Several municipalities in the Kansas City area either have implemented or are considering implementing some form of landlord licensing. In Missouri we have a wonderful thing called the Hancock Amendment that; in theory prohibits governments form imposing taxes without a vote of the people.
0 Comments

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