Massachusetts is a tough place to be a landlord.
Before you get out the tiny violins, let me say I’m no Anwar Faisal, the rental titan whose 2,000 or so apartments in Greater Boston have been the subject of hundreds of code violations and dozens of complaints and lawsuits. I own just two rental units in the city. One has been, with the exception of a single tenant in 16 years, a dream, with polite, helpful, clean renters who always pay on time. In just five years as a rental, the other — which has hardwood floors, granite countertops, and a $1,200 dishwasher — has been a nightmare, with tenants who bounced checks, didn’t pay their rent, and threatened to call the building inspector over, among other things, a loose toilet seat, a missing outlet cover, and, I’m not kidding, a bedroom that is allegedly 0.389 of an inch too small.
The tenant who detailed these horrific, slum-like conditions also threatened to take me to court over some food that had spoiled when the refrigerator broke — which is what prompted the intimidation tactics in the first place.
Despite my intense dislike for strong-arming tenants, I had to put up with them for a while; in Massachusetts, any action a landlord takes within six months in response to a complaint is presumed to be retaliation. There is no such thing, under the law, as retaliating tenants.
The last thing I wanted was to go to court. Not because I thought I’d lose but because I’ve learned, as many small Massachusetts landlords I’ve talked with over the years have, that it’s better to just negotiate a settlement with bad tenants than to argue with them. “Cash for keys,” as real estate lawyer Richard Vetstein of Framingham calls it.
While no comprehensive state-by-state comparison of landlords’ and tenants’ rights and responsibilities seems to exist, “I would definitely say Mass. is high up for tenant protection,” Vetstein says. Tenants’ advocates strenuously disagree, maintaining that money-hungry landlords raise rents exponentially on a whim and evict low- and moderate-income tenants for no reason other than to get higher-paying ones in.
I think both sides have a point. It’s certainly true that there are landlords who habitually violate housing codes and tenants’ rights. But there are also tenants out there who can cause small landlords like me — people who don’t enjoy the economies of scale of those with dozens or hundreds of apartments — no end of stress while also costing us considerable money in a business that often has a low profit margin to begin with. After factoring in taxes, insurance, repairs, and some included utilities, my two units barely break even.
The law can seem onerous to both sides. Some substantive issues seem to favor landlords; for example, the right to raise the rent with no ceiling or time limits, and the right to evict without cause those on month-to-month agreements. Procedural issues, on the other hand, lean largely pro-tenant. In addition to the law labeling as retaliation basically any action taken after any complaint, the Commonwealth has one of the strictest policies in the country on penalizing tenants for late payment of rent — no fees can be charged until after 30 days.
Another problem for small landlords is that if a legal dispute arises, tenants aren’t automatically required to put ongoing rent payments in escrow, so that if the case is resolved in the landlord’s favor, often the tenant will no longer have the back rent owed. With an average judgment of about three months’ rent, this can be a real hardship for house-poor landlords. And once a landlord does evict a tenant who owes back rent, he or she must pay to move the tenant’s belongings out of the apartment in addition to three months’ storage costs.
Many tenant advocates believe laws like this barely skim the surface in safeguarding low-income renters. But they can also have the opposite effect by discouraging landlords, despite anti-discrimination laws, from taking on higher-risk renters in the first place.
For years, bills have languished in the Massachusetts Legislature requesting what may seem a small and practical change: that tenants be required to escrow rent money during an eviction dispute. It has never passed, in part because tenants’ organizations are powerful and well organized, and landlords’ groups historically have not been. But Oregon, for instance, recently passed a law that banned Section 8 discrimination while also strengthening some protections for landlords, including the ability to recover state funds of up to $5,000 for property damage caused by Section 8 tenants.
Oregon’s new law doesn’t address all of the issues we have here, but it was considered a win for both landlords and tenants. There’s no reason Massachusetts can’t pull off a similar victory.
By the numbers:
944,888 — Estimated number of apartments in Massachusetts
75% — Estimated percentage owned by families or small businesses
Source: US Census Bureau, 2009-2013 5-Year American Community Survey; Small Property Owners Association