Tag Archives: housing

In miniature, July 6

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Latest mandatory-Section-8 push in Baltimore County

Last year I wrote:

In principle, the federal housing-voucher program known as Section 8 ought to win points as a market-oriented alternative to the old command-and-control approach of planning and constructing public housing projects. While allowing recipients wider choice about where to live, it has also enabled private landlords to decide whether to participate and, if so, what mix of voucher-holding and conventionally paying tenants makes the most sense for a location….

For landlords, participation in the program has long carried with it some significant burdens of inspection, certification, and reporting paperwork. So long as participation was voluntary, these conditions were presumably worth it in exchange for the chance to reach voucher-holders as a class of potential tenants. When accepting Section 8 tenants stops being a voluntary choice, however, the balance is likely to shift. And one of the big policy pushes of the past decade — zealously promoted by the Obama administration — was the local enactment of laws and ordinances prohibiting so-called source-of-income discrimination, which in practice can mean making it a legal offense for a landlord to maintain a policy of declining Section 8 vouchers.

Since then, battles over whether landlord participation in Section 8 should remain voluntary have continued to flare around the country. While progressive litigators have thus far failed to derive an obligation to participate from the “disparate-impact” branch of housing discrimination law, they have persuaded the American Bar Association to endorse laws along these lines. Among the many local battles is a long-running controversy in Baltimore County, Maryland, the subject of this useful opinion piece in yesterday’s Baltimore Sun by local businessman Ben Frederick III.

It is sometimes claimed that to not participate in the program is to “discriminate” against voucher-holders, and suggestions of proxy racial discrimination are often not far behind. But as Frederick notes, landlords (many of whom are minority themselves) object above all to the strings:

There is nothing discriminatory about a person who has invested their life savings in a rental property deciding that they do not want to lose two month’s rent while waiting for a voucher holder to be approved and move in before they begin seeing rent; or from refusing to sign a federally mandated 12-page lease addendum; or from being subject to the whims of government funding for approval for how much rent might be paid; or from being subjected to annual inspections that are unpredictable and inconsistent, where the government will stop paying rent if the rental unit needs repairs, even if tenants abuse and damage the property.

Johns Hopkins study last year for HUD of low-rent housing markets in Baltimore, Cleveland, and Dallas found that among landlords who chose not to participate in the voucher program, “the primary reasons stated were negative experiences with the program itself, including frustration with the inspection process, general bureaucracy, and disappointment when the PHA [public housing authority] did not take the landlord’s side in conflicts between landlord and tenant.”

Frederick notes that other landlords can and do build a business model around serving Section 8 users. That might involve developing standardized procedures, hiring and training staff with an eye to compliance know-how, and cultivating relationships with government actors. This is all more easily done at scale by adequately capitalized entrants in the rental property market. As it happens, however, the ranks of real-world landlords — perhaps especially in less affluent communities with older housing — include many mom-and-pop landlords short on the skill and inclination needed to pull this off.

Other government voucher programs, Frederick points out, get along with voluntary provider participation. “According to the Kaiser Family Foundation, 72% of physicians accept Medicaid, the government-funded health care program for the poor; 75% of food retailers, including grocery stores, convenience food stores and farmer’s market retailers, accept SNAP, more commonly known as food stamps.” In both cases, shouldering the regulatory burdens gives them access to valuable customer markets. But when they don’t find the burdens worth it, no one compels the doctors and food retailers to participate (at least not yet.)

“As business owners,” Frederick writes, “landlords should be free to make the same choice.” Indeed. [cross-posted from Cato at Liberty; earlier)

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Will Baltimore County force landlords to take Section 8?

In Baltimore County, county executive Kevin Kamenetz has introduced a bill to ban “housing voucher discrimination,” that is to say, a bill requiring landlords to take Section 8 tenants. “Kamenetz is required to introduce the bill as part of a housing discrimination settlement with the federal Department of Housing and Urban Development that was reached this year. … If [it] does not pass the County Council, the HUD settlement requires it to be reintroduced in future years.” Landlords and property owners say that it is unfair to force them to enroll against their will in a program with cumbersome paperwork and inspections. [Pamela Wood, Baltimore Sun] HUD is now arm-twisting jurisdictions nationwide into enacting these bad laws; earlier here (bad renter trashes unit), here, etc. [cross-posted from Overlawyered]

Update: County council votes down bill [Baltimore Campaign for Liberty]

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My letter in the Washington Post on Baltimore evictions

I’ve got a letter to the editor in today’s Washington Post. An excerpt:

The Dec. 11 Metro article “Baltimore eviction rate among highest in nation” reported on advocates’ efforts to change eviction procedures to allow Baltimore tenants to stay longer in rental housing even when they fail to pay their rent. One effect, of course, would be to make it even less attractive to offer and maintain rental properties in the hard-hit city.

Before going farther down such a road, it would help to review failures of existing Maryland housing policies….

And then I talk about Maryland lawmakers’ having enacted various legal changes to slow down foreclosures, and the unpleasant aftermath, a story told here. Why would a state want to go through a very similar wasteful, blight-encouraging exercise for rental property?

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In miniature, September 6

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Frederick County: beware “affordable housing”

There’s currently a buzz for our county to back more “affordable housing” construction, as an exaction from developers or otherwise. But Tom Coale, who ran as a liberal Democrat for the legislature from Howard County last year, points out a huge drawback with many such schemes:

We all love the idea of affordable housing, little a, little h. But homeowners who buy into Affordable Housing units, big A, big H, are trapped in financial purgatory. ‘Deed restrictions’ on the resale of the property, that may run for as long as 99 years, prevent them from building wealth from the asset. That means one of the core reasons for purchasing a home, and not renting, is absent. Meanwhile, all of the burdens of home-ownership remain.

A scheme introduced by County Council member Jessica Fitzwater (D) would (among other changes) earmark some rentals as legally obliged to stay affordable for 99 years instead of 25. Policies like these have not worked in other parts of Maryland, and we should be wary of them here.

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