Podcast 270: Landlords Plot to Screw You Over

A recent expose from vice.com talks about the evils of landlords…

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Show Transcription:

Speaker 1: (00:00)
Hey everybody. Welcome back to another episode of RentPrep for Landlords. This is episode number 270. And today we’re going to be covering an article that appeared in vice.com and it’s titled inside the wildly popular form where landlords plot to screw you over. Yeah, this is a pretty, a controversial article that was posted on July 24th by Rick Paulus. And now we’re going to take a deeper dive at it and look at what they are talking about in this article, I’m going to get to that right after this.

Speaker 1: (00:39)
So on episode 270 here, if you’re not familiar with vice, it’s pretty popular news outlet, uh, that has sprung up probably in the last 10, 15 years. And um, the, as I mentioned earlier, the title of this article is inside the wildly popular forum where landlords plot to screw you over. I kind of saw it and I was like, oh, I hope they’re not talking about RentPrep for landlords because we do try to keep it sensible in there. Uh, but they’re actually talking about bigger pockets and, uh, we’re going to be going over some of the, uh, the articles and posts and forums that they’re talking about. Uh, and I should mention that, uh, before we get into this, we are affiliated with bigger pockets now. Uh, we are, uh, one of their, uh, landlord resources and, uh, also, uh, I give them props because they do spend a lot of money actually on moderators trying to moderate their forms, but they’re really, really highly trafficked and it’s very difficult to moderate everything.

Speaker 1: (01:35)
So, and I know this too because we, uh, we moderate the forum at a rent prep for landlords in our Facebook group. And sometimes I, it’s a little bit difficult. These things kind of sprawl out of control. Uh, we’ve actually started investing in a part time moderator who does this professionally, uh, to help us kind of make the group the best resource it can be, but also make it a positive atmosphere where we can learn and grow together. Um, and not just a place where, uh, you can go and, uh, bash tenants or, uh, provided legal advice, which is what we’re going to kind of see in some of these, uh, posts that we’re going to cover now. So, uh, this article was posted on July 24th, 2019 by Rick Paulus, p a u l a s, and it says that it’s a terrifying window under the tenant landlord power dynamic and a national housing hells cape.

Speaker 1: (02:26)
So I’m going to read a bunch of this article to you. Uh, and it starts out and it says that it’s hard to visit biggerpockets.com website targeted property owners who create lasting wealth through real estate without wondering how exactly they’re stuffing those pockets. So you can kind of see the slant on this far right from the Gecko. But it said this site, which has been around since at least 2006, is accumulated quite the following according to the sites about page. It’s 1.4 million users are part of a movement within the real estate investing community centered around grassroots democratized education. Some of the advice certainly does not seem or does seem innocuous tips for landlords, but a key way to stop those pants is knowing how to be savvy in dealing with runners. There’s plenty of advice on that front too. In fact, one of the more common gripes in this landlord form is about the quality of tenants.

Speaker 1: (03:14)
A, take this one for example, so this is was somebody from uh, Fort Lauderdale and they said, hello guys, please help. I have a new tenant with children who relocated in the area for a job promotion from the day she moved in. She’s been complaining about the smallest things. It’s only been two weeks, a one blind missing a roller missing light bulb in the chandelier requesting a new fridge despite having a working one. I purchased a new one. Um, AC is not cool enough and I just updated the duct and system is less than four years old. Now She’s told me a drug addict was in her trash can at 6:00 AM on the sidewalk. She did ask if she can look for another home, but per the lease she would have to pay two months rent for breaking the lease, uh, first time with this issue. What can I do?

Speaker 1: (03:58)
So, uh, at least for me when I’m reading that, um, I think that it’s a pretty legitimate post, uh, that this person is putting out there because it is kind of one of those things where you’re like, okay, it’s a brand new fridge. What’s not working on it? One light bulbs missing. Um, and you know, the person doesn’t want to break the lease. So they got a reply. And I think this is what happens sometimes on these forums too, is the reply is coming from somebody in West Virginia. They said, stop or stop responding to her petty complaints. Tell her if she isn’t happy that she can pay you the two months worth of rent for breaking the lease and to have a good day. Obviously a pretty snarky reply. But, uh, these online forums, sometimes, you know, it’s difficult because the people are commenting from a different area.

Speaker 1: (04:41)
They don’t know the laws. They’re not, uh, an attorney. They’re not local, any of that. Uh, here’s another thread. I, it says that a landlord posted about needing to claw back rent payments made to previous property manager and was offered support. So they said they provide a tenant with a five day notice to peer quit. You provided the necessary notice it should be up to him to do the leg work. So then somebody else, uh, commented you don’t collect from the pm you collect from the tenant. I recommend you let the tenant know the rent is past due and that a notice to pay or quit is being issued. The time to cure is determined by each date. It ranges from three to 14 days, not by allowing their problems to become yours. You might just get paid today. Fingers crossed. So that particular one, I know it sounds cold, but the person’s giving advice and not even saying like, hey, give it a three day notice.

Speaker 1: (05:29)
He’s saying it varies by state and saying that their problems are not yours. A little confused as far as where the property manager payment comes in on that. Um, but it, it’s really interesting, um, where you can see somebody’s bias kind of comes in to, uh, these, uh, scenarios. So, uh, an interesting perspective that I just heard over the weekend, and I think I’ve mentioned Malcolm Gladwell on this podcast before. He has a podcast called revisionist history and, and he’s talking about what is acceptable in baseball as far as performance enhancement drugs. So what he does is he starts the episode off. He’s talking about Andy Pettitte. So Andy Pettitte, a famous Yankees and Astros pitcher, um, was, uh, indicted on using, uh, performance enhancing drugs, uh, to recover from an injury that he had sustained to his elbow. So, uh, he was kind of, you know, cast off as this person who was cheating to, uh, perform better.

Speaker 1: (06:31)
But one of the things that they talk about is Tommy John Surgery. This is a famous surgery, uh, named after the player Tommy John. And at the time he used cutting edge medical technology. And what they did is he had a ligament damage in his elbow and they were able to take a ligament from elsewhere and replace and repair that ligament. And he was able to return to form, uh, that he was at before the injury and he was able to pitch, I think into his like mid forties or something crazy like that. So the article then talks about a different extreme because with Tommy John Surgery, that is something that has been emulated by hundreds and hundreds of pictures that have gone through the same thing to, uh, make their career longer. So with the other end of the spectrum, you have Barry bonds. You have a guy who did steroids late in his career, ended up doubling his home run numbers, um, got absolutely giant, even his head size, his cap size changed late in his career because he altered his body so much from taking steroids.

Speaker 1: (07:30)
So with the, uh, the, the host of the podcast Malcolm Gladwell was talking about, he’s like, you have the spectrum here. So you have Tommy John to one side and you have Barry bonds and the other. But when you look at what Andy Pettitte did, what he did is he’d used modern medicine, uh, and technology to recover from an injury to return to the form that he was at before. And, and there’s explaining, it’s like, how do you balance that? How do you look at that and say, you know, what, is this guy at Barry bonds or is he, um, Tommy John’s. So it’s difficult to do. And the reason I bring up this story in this analogy is it’s very similar when you’re looking at the landlord tenant relationship, depending on the lens that you’re viewing things through. So I’m reading some of these, uh, articles on vice.com and you know, I kind of tend to be a little bit more, um, pro tenant than your, probably your average person who’s a landlord and also works for a tenant screening company.

Speaker 1: (08:28)
Um, but at the same time, I read some of these and like either they’re talking about how heartless these people are in it. At the same time, it is a business, you know, uh, the, this guy is not advocating for you to throw this person out. He’s saying if they’re not paying rent to go through the proper channels and you know, you might be kind of blunt about it by saying that, you know, by not allowing their problems to become yours, you might just get paid today. Uh, I get it. You know, it’s very blunt. Sounds mean, but he’s also advocating for going through the proper process based on your state. So that’s the, uh, the, the dynamic that this article kind of starts to highlight is pretty interesting. So we’ll skip ahead on a few of these. Um, it says that, uh, Veritas, these complaints may seem they illustrate an important point that all tenants eventually discover, but many too late, your landlord is not your friend.

Speaker 1: (09:18)
Rather this relationship informed by an inherent power imbalance. One person allows the other to pay a fee to live on their premise. And while there are a few basic necessities that landlords must provide per local regulations, assorted demolished keys constantly hangs over the heads of some 108 million renter, a runner. Americans be honest, I don’t know what that is. Sorta Tamale keys. He should’ve looked it up beforehand. But a law professor, Susan at a Keller examine this power dynamic in the 1988 edition of the Cardozo Law Review. Here’s what she said. She said, the landlord has no reason to please or appease the tenant, but the tenant has every reason to please or appease the landlord. Moreover, the landlord may find it in her interest to do the opposite. A landlord may seek to displease a tenant who she finds objectionable, hoping a better one will come along or intending to rent at a regular market rate.

Speaker 1: (10:06)
Uh, that right there, um, again, you can see that this is written with a slant. It says the landlord has no reason to please or appease the tenant. And I think that is absolutely untrue. If you’re a landlord and you have a great tenant, I see it all the time. People try to appease and please that tenant, you want that tenant to stay. There’s nothing better than getting a great tenant paying market rate for the rental. Um, who pays on time isn’t a headache. And you know what? When they’re texting you because there’s a problem, it’s because there’s a problem. You need to get something fixed. Something’s come up, you know, it’s a great tenant and a, I’ve had tenants like this and you know, I get them a little something around the holidays or at Taxes to check to check in and see how they’re doing.

Speaker 1: (10:48)
Um, I think it’s Kinda, uh, already you can see that there’s a slant there. I do understand that there is definitely a power dynamic there. But, um, I think that that’s a definitely written with a slant. Uh, it says, one clear way to think about this is I is by defining what the space being inhabited means to the two different classes, to the tenants, the home to the landlord. It’s job, oh, I’d say the landlords and investment more than a job. But, um, tenants, especially when talking about poor tenants for several jobs and several kids, they’re just trying to make a life for themselves as ever. Rose, an assistant professor at Georgetown School of Public Policy and an expert on urban sociology. Landlords are coming at this from a much more strategic place to maximize profits. When told about the very believable rumor in the crunch, San Francisco housing market, we’re in prospective runners bring baked goods to house to open houses to win over potential landlords.

Speaker 1: (11:37)
Rosen laughed. The goals are very different. So strategies are different. I’ve never heard that rumor. Uh, doesn’t surprise me. A A in college, uh, was seeing a girl who went to, um, Michigan on and uh, it wasn’t me. Yeah. Michigan and she said that there, the housing was so, uh, attractive. The supply and demand was so out of whack for student housing, especially close to campus that people would set up tents in the lawn. So there was like this, uh, this kind of almost like black Friday scenario, right? Black Friday shoppers that would set up tents and then just to be the first in line to apply a, which is crazy, you know, but it’s supply and demand and that’s what San Francisco has going on right now. Uh, and it’s definitely created some issues. But, uh, it’s pretty funny. I haven’t heard about the baked goods rumor.

Speaker 1: (12:28)
So going back to the forum, uh, here’s one where somebody was asking, they said, uh, if they were evicted, you have to hold for seven days. You should change the locks, uh, self help eviction where you just changed the locks on somebody. Um, never a good idea. Uh, this person’s giving a bunch of eviction advice and then somebody chimes in and they say, well, actually, I’m in California. It’s completely different here. So you know, you, you get the, they’ve got a, a person commenting too, they said, I like it. Eviction is good for the soul with three exclamation points, and they spelled soul, S. O. L. E. I can see why they kind of featured that comment on this article, but it’s so tough. Uh, you know, there’s bad apples in every bunch. There’s bad apples when you’re looking at tenants, there’s bad apples. When you’re looking at landlords, if you want to peruse a, the bigger pockets forum and look through 100,000 posts, you’re absolutely going to see some stuff that’s a pretty unnecessary, uh, illegal, mean, uh, whatever kind of negative connotation you want to dream up there.

Speaker 1: (13:35)
You’re going to see the same thing around RentPrep for landlords. We try to crack down on that and we’re trying to actually do a better job of making it more of a productive forum for people. Cause I do feel like it’s slipped a little bit in the last few months and that’s why we’re investing to actually have a part time moderator. Uh, but that’s life, right? There’s, they’re going to see that everywhere. You’re going to see good apples, bad apples and it doesn’t matter what you’re talking about, you’re going to see it. So it’s saying that while the differences between owner and renter are embedded in the model, the fault lines weren’t always as stark as they are. Now a detailed in the 2014 report, the rise of the corporate landlord, but the advocacy group, homeless Raul, the U S for closure crisis resulted in dramatic shift and ownership virtually overnight.

Speaker 1: (14:18)
In some cases former homeowners were shown it back onto the rental market in the property now owned by investment companies. The terrain upon which these battles are taking place is also important to consider. Laws vary from state to state. City city, a Megan Hashi, associate professor of urban studies at Cleveland State University, classified three different legal approaches to police the tenant, landlord relationship, protectionist, pro-business and contradictory protectionist. Look out for the tenants pro businesses. Pro Landlord and contradictory is a mix between the two, but it is fairly consistently sides with property owners or but it fairly consistently, uh, sides with property owners. As color wrote in 1988, a landlord is somewhat legally protected to make the tenants living situation a living hell. But the legal protection is not extending in both in the other direction.

Speaker 1: (15:16)
Like it almost seems like a typo reading. I mean it’s from 1988, which is just ridiculous in my opinion, that they’re quoting a, uh, a law article from 1988. What are we looking at? 30 31 years old is what that is. I mean, just in the last few years, you can look at different states where you can say, wow, this is really different. I mean, just in the last six months, the changes that have happened in New York state in Pennsylvania, uh, Colorado, uh, Washington, Seattle, I mean, they’re all over the place. So I mean, it’s like, I don’t know, that’s, I find that pretty annoying to be honest. Uh, this power imbalance further reveals itself in court. The number that often gets tossed around is that 90% of landlords are represented by Laura’s when 90% of tenants are not. The obvious reason for that is the income disparity between the tenant who cannot afford to buy a place and the landlord who the tenant is paying money to. In a way, a little bit of every month’s rent is going to your landlord’s lawyer. I’ve never had to hire a lawyer, so that’s untrue for me at least. Meanwhile, any new tenant protections are fought in court as long as possible by landlord groups. Even if they lose, they get those extra runs while the battle drags on.

Speaker 1: (16:26)
Yeah. I’m, I’m about done with this article. I don’t normally get pretty annoyed by these, but this one’s just so asinine in the fact that it keeps referencing in 1988 law article. Uh, and then it’s also pickpocketing the worst of the worst comments on bigger pockets and then calling it a terrifying window into the tenant landlord power dynamic and a national housing hell scape. Um, Eh, so much news and information that’s disseminated is online and it all has analytics backing it now. And it’s just, there’s so much click bait. And I mean to say that this is the wildly popular forum where landlords plot to screw you over, right? What you’re doing there from a marketing standpoint is you’re finding a pain point, a point of agitation for renters, right? And they see the title and it says that landlords are plotting to screw you over. So the, the goal there is to get the click and then you want to identify with the pain that they’re feeling.

Speaker 1: (17:28)
So this article is written obviously to, to a stir up clicks for tenants. And then beyond that, uh, it is written in a way, um, to be very pro-tenant and talk about how bad tenants have it. Because your, you, whenever you’re, you enter a group, right, of people, you always want to make sure that you’re talking to the things that, uh, are important to them. The things that they value. Uh, the things that they, um, they hate are the things where they feel like they’re being unfairly treated. And that’s all this article is doing. And I’m sure you can go on another article that’s pro landlord and it’s going to sit there and rip into, you know, new regulations or how terrible tenants are and all this stuff. And it might even use bigger pockets to show examples of like, look how bad this landlord is being treated by their tenant.

Speaker 1: (18:17)
Uh, look at this story, look at this story. I don’t know, a lot of this stuff’s just, it’s frustrating to read. Uh, there’s no easy solution for it. And I think the reason for that is because of the interesting balance between a landlord and a tenant. One person having housing, another person having an investment or as this article called that a job. Uh, it does make for a very unique dynamic that does not happen very often. Like when you go to the workplace, everybody there is working. You might have different, you know, uh, imbalances in power as far as, you know, there’s bosses, employees and so on and managers. But everybody there is there to do a job. The relationship between the landlord and tenant, you’re, it’s, it’s just interesting. Uh, and that’s why you get so many issues that arise out of it. But you know what, at the end of the day, do right by people.

Speaker 1: (19:06)
Do good by people. Make sure that your rental property is well taken care of. And if you get a bad tenant in, get ’em out. Do it legally. You know, don’t renew the lease after the years up. If they’ve been an absolute nightmare tenant, which happens, get a new tenant, then, um, that doesn’t make you a bad person for doing that. If you’re a good landlord who’s treating people right, you deserve to have good tenants who are treating you right as well. So that to me is what the article should really sum up. And unfortunately, um, it’s just another article that’s kind of leaning heavily one way because that’s what gets clicks. And that’s what gets attention. You don’t get attention by just saying, you know, do the right thing. Treat people well and hope that it works out for the best. You know, that doesn’t get you clicks, unfortunately, but that’s all we got for this week. Hopefully next week we’ll find something a little more positive to ruminate on and that we’re getting to get into a some reason news articles that have been effecting landlords as well across the country. All right guys, until next week, have a great week and take care.