Posted on 02/13/2022 1:54:16 PM PST by grundle
Andrea Suchy-Shinn owns six rental properties in St. Paul, at least half of them open to low-income tenants subsidized by federal Section 8 housing vouchers, but she's in the process of selling.
Her townhomes in the Selby-Dale neighborhood likely will be converted into condominiums. Her triplex off Congress Street, on the city's West Side, is poised to be sold to a new owner who may not accept new tenants who rely on federal vouchers to pay the rent.
"It'll be up to him," Suchy-Shinn said. "Right now, he says the Section 8 tenant that's currently there can stay."
Her reasoning for reducing her footprint in the St. Paul market? Under the city's new rent-control mandate that takes effect May 1, she doubts she'll be able to keep up with cost increases for heat and utilities, property taxes, trash collection and everyday maintenance.
In fact, at her fourplex on the 1600 block of Charles Avenue, which could go up for sale soon, "I'm right now not breaking even," said Suchy-Shinn, who saw her property taxes for the one location climb from $6,000 to $9,000 in the course of a single year. "The heating bill was $618 for one month. I pay the heat. Everything is going up."
Suchy-Shinn likely isn't alone. Even before voters approved a citywide "rent stabilization" ballot measure in November, some critics cautioned that the 3 percent cap on annual rent increases could have ironic consequences for the city's affordable housing. Instead of keeping prices down, they predict the mandate will lead to less affordability.
Apartments once priced at levels that the working poor might get by on could be converted into condominiums and sold, further reducing the supply of affordable rentals in the city.
(Excerpt) Read more at yahoo.com ...
RE: As rent control looms, small St. Paul landlords sell low-cost units
Who in his right mind would:
1. Buy these low cost units to rent out
2. Bother to build any more low cost units?
Suchy-Shinn likely isn’t alone. Even before voters approved a citywide “rent stabilization” ballot measure in November, some critics cautioned that the 3 percent cap on annual rent increases could have ironic consequences for the city’s affordable housing. Instead of keeping prices down, they predict the mandate will lead to less affordability.
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It’s almost as if the government, *cough* BlackRock *cough*, planned it this way.
For sure owners need to remove utilities from the rent and billed separately. Those are guaranteed to continue skyrocketing under Brandon.
Indeed.
Ayn Rand
To heck with people who choose to live in cities.
Avoid this like the plague
That’s the problem with price controls. They make things more affordable, but there’s nothing affordable to buy.
tagged
Selby-Dale was the Red Light District when I was in High School.
It went upscale but I’m pretty sure rent control would push it back to the ‘70s
1. Buy these low cost units to rent out
Big developers buy them in bulk. They then demolish them, or convert them into condos. They can afford the legal fees and long approval process. And although some assets will lose money, they're betting most will turn a profit.
They don't even have to use their own money. Wall Street will package hundreds of these building into REITs, thus creating a new security asset that they can sell to institutional investors, pension funds, or common rubes.
And if the REITs collapse in value, Wall Street will lobby for a bailout.
While small landlords might go bankrupt, REITs are too big to fail, so they're "protected" by the government.
Welcome to the Globalist Oligarchy, where they privatize the profits, and socialize the losses.
Rent control is the fastest known way to create new slums.
Owners skimp on maintenance and other operating costs—and the rest is history...
If you want to build luxury condoniums, you have to own a certain number of low cost units so I guess you'll take a loss on them.
No, places like St. Paul and other big cities are not for rental properties market.
Even though government will pay for it, it’s still not worth it, because tenants are not civilized enough to keep your property in shape. Those who rent to section8 know what I talk about.
Urban ‘Rat Utopias.
Like Venezuela.
Convert to condos. No rent required.
Easier said than done. Smaller buildings likely share one common heat source. This would require adding heat systems splitting electrical systems and plumbing systems
Aka big money.
Plenty of rentals split utilities between rentals.
Ouch. No wonder the small operators are trying to bail. My gas bill is up 80% from a year ago with less heating degree days.
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