Help with Seattle Rental Laws

[Jeremy Benezra]

Hi everyone,

I am in search of someone from BiggerPockets I can have a phone chat with regarding Seattle rental laws.  If you can help me out I’d be happy to mail you a gift card or help you some other way if I can, in appreciation of your time.

Over the past 8 or 9 years I’ve acquired a handful of rentals in Seattle suburbs and south of Seattle but I’m currently setting up my first rental inside Seattle limits, the remodel will be done in a week or two.  I know there are Seattle-specific rules about rentals, I need to get an inspection and get the house registered, etc.

In the past I’ve used a leasing real estate agent to find me a tenant, do all the background screening, do the leasing paperwork, etc.  But I lose 1 month rent for that service.  Last week, mid-remodel, I put a few photos of the house on Zillow at what I thought was an above-market rent rate, just to see what would happen.  There’s been a huge response of interest!  4 separate showings yesterday and overnight several applications came in through Zillow.

I haven’t yet posted renter requirements like credit score, income > 3x rent, no pets…  I’ve had showings.  I’ve received rental applications.  I want to make sure I do things properly with Seattle RRIO.  There’s a big difference in the prospective tenants – families, groups of roommates, professionals, friends straight out of college.  I just wanted to chat with someone, not on a public forum, about what I can and can’t do, what restrictions I can place…to get the best possible tenant into my freshly remodeled house.

Lastly, I obviously want to maximize my return.  With so many applicants, is it reasonable and/or legal if I tell everyone the rent is actually $200-400 higher than originally posted, who is still interested?I have questions along these lines.

If everyone thinks its prudent to contact a Seattle rental attorney or similar, I could go that route too.  Thanks,

Jeremy

[Brian Hughes]

I've got a couple small rental properties in seattle.    I'm no attorney and my advice is worth only what you pay for it,  minus the cost where I got it wrong!

If you are self managing and new to seattle, it is definitely a good idea to attend the city provided training.  Some other thoughts:

0)  Your rental does need to be registered.   You don't have to get an inspection up front but you do have to certify your rental meets the criteria,  and the city will eventually require an  inspection.    Hasn't happened to me yet (jinx)  FWIW.  

1)  Join RHA  (rental housing association of washington)  rhawa dot org.   Its well worth it,  and they also offer frequent training,   attorney-reviewed rental forms that are correct and legal for seattle, etc.,  as well as organized and effective local advocacy.    They mostly represent small individual owners so their services and focus are well tuned to that segment.    Also,  the annual "Trends" rental housing regional conference put on by them and other local/regional rental associations is coming up in december.  you may want to attend.   Be sure to expect protesters though if like last year....

2)  If you got a huge reply,  you underpriced..   I understand the desire to avoid a PM  (I started out without one,  seattle laws and various other reasons I started working with one in early 2017).   However a PM might have known where to set the price...  possibly netting more in the long run.    FWIW a lot of PM's around here charge less than the typical 10% rate you see in "cash flow" markets.   (rents are higher overall, so they can charge a lower percentage and get the same return on mgmt effort)  So it may be worth it.

3)   You must have written screening criteria if you are doing showings in seattle.   if you want an example of what I  developed over about 10 years of self managing in seattle,  message me privately.   (its partly illegal now though)  and you can find other managers' criteria by following links on craigslist ads for apts.   Get your criteria on paper before you do another showing,  put it in the hands of everybody who views  (along with lead disclosure,  WA landlord tenant law,  fair housing poster,  and everything else I cannot remember you are required to give people who are viewing)  and send copies post-haste to anybody you already showed who is still interested.   

4)  I don't think it is illegal to change your price after advertising  (clearly it is OK to reduce your price, if nobody is biting)  but if you have already taken applications it would be kinda sleazy to change the price on them,  and if you do, make darn sure you communicate  the same exact price change for EVERYONE who has already viewed or you could be hit with discrimination claims.   If you must raise price,  communicate early and clearly so the surprise is minimized,  and consider offering refunds on any applications fees if those applicants decline to proceed.

5)  make darn, darn sure you don't discriminate on all the usual attributes,  as well as source of income,  and criminal history.   If you need a one page summary,  look at the fair housing poster/flyer you are required to hand out with showings,  or have posted.   It lists about 18 or maybe 37 different attributes that constitute protected class.    Its tecnically OK to screen multiple applicants and pick the "best" one again without first in time,  but its still considered bad practice by most everybody around here and can invite discrimination claims.     Define your criteria,  advertise them,  and accept the first applicant that qualifies insomuch as possible.     If something comes up that makes you uncomfortable and you need to refuse them,   make sure that gets added to the criteria for the next go round.    If its not something you want written down,  time for some introspection.

There is undoubtedly more but thats enough brain dump for me for one post.