All Forum Posts by: Chris Campeau

I tend to agree.  At least if there is logical compromise it would seem that an easy compromise would be to simply bolster the current RAFT program or Section 8 via individual housing authorities and give them the power to screen and issue some type of temporary COVID housing voucher to pay the rent.  To me, that sounds like the fairest and simplest to implement as those agencies already have the infrastructure to handle such a program, they just may need to scale a bit but not maybe as much as one would think.  Sure, we would not be able to evict potentially but at least be compensated in some way.

Hi Jon, I hope you are right about it not getting out of committee.  I just do not want to be complacent and regret it later.  I tend to agree with you about being a landlord in MA, at least up until now as we don't know how things will turn out both at a macro economy level and of course locally in MA.  While MA tends (at least in my opinion) to lend more support to tenants during landlord tenant disputes, the diverse economy, good schools and good healthcare (among other factors) has tended at least for me to at least level that playing field and based on market cycles has also helped propel some additional benefits.  All in all, I did like the MA market I am in...like you said, we can do a check-in in a year.

I know.  I am not sure how anyone can disregard the value of housing so much so where it could be considered a candidate for legal shoplifting.  To me, it is not different (actually worse) than telling supermarkets that they need to set legal shoplifting hours so that those in need of food can shoplift and not be prosecuted for up to 1 year after the state of emergency has been called off.  We are doing our best to fight this but it is happening so quickly (now it is considered emergency legislation and can bypass certain committees) that I am not sure how this will turn out.  Bigger Pockets should at the very least send out some type of announcement or notification within Bigger Pockets to at least alert it's membership of the possible ramifications of this and the likely spread.  It has potential to take down the dream of being a small landlord. 

If you are not aware, Massachusetts has both a House of Representatives and Senate bill that if passed will likely be devastating to small landlords. The House of Representative Bill is HD.5166 and the Senate Bill is SD.2992.  I will provide a link to the bill, a link to the State of MA Housing Committee and a link that will show you the contact information for your Representative and Senator.  I urge you to call, email and encourage anyone else you can reach out to do the same in opposition of this very shortsighted, likely unconstitutional, not to mention how just plain completely wrong and ridiculous (in my opinion) this bill is.  In a nutshell the bill contains the following:

1.  The bills seek to extend the current MA eviction Moratorium by 1 year AFTER the governor declares the State of Emergency Over.  That could be "whenever" as it is not defined.

2.  The bills seek to CANCEL rent due for the period of time of non-payment.  NOT postpone it.  Think about that.  Not only could you be out rent for a year plus (whenever the emergency is over) but you will still have to pay and go through housing court to merely attempt to gain possession, not to be awarded back rent.

3.  The bills seek to "hide" this information of non-payment by not allowing the courts to report it.  That means it will NOT show up on future background checks.

4.  This bill allows individual municipalities to EXTEND the moratorium if they desire.

5.  While they attempt to offer some type of relief through mortgage forbearance we all know that all costs above and beyond merely the mortgage payment can range up to 50%, forbearance does not apply to all property owners (read the details) and of course the money needs to be paid back.

6.  While the mention a "fund" to which landlords can apply to seek relief, if you read the details you will see there is not mention of how the fund will actually be funded.  It also has language stating who the relief would apply to... certainly not everyone.

You should read the details for yourself, this is what I have gleaned from it.  I think you may come to the same conclusion as myself which is that this amounts to nothing different than if the State of MA told grocery stores that they need to allow shoplifting for those who need food for up to a period of 1 year from a date that has not yet been declared and that they will be lucky enough to be able to "apply" to get their money recovered...someday and somehow not defined.  

You may also come to the conclusion that this could be considered a government taking without just compensation.  

You may also come to many other conclusions that show how wrong and backwards this is.

Here is the link to the bills:  

https://malegislature.gov/Bills/191/HD5166
(the senate one is linked to from the house bill page on the right side)

Here is a link that shows you how to find your Representative and Senator:  
https://malegislature.gov/search/findmylegislator

Here is a link to the Joint Committee on Housing:

https://malegislature.gov/Committees/Detail/J28

You could start with emailing and calling your State Representative and State Senator as well as each person listed on the Joint Committee on Housing page including those listed below the pictures.

Hope this helps.

Chris

Hi Caroline, yes this madness struck me in the heart 2 weeks ago when one of my handy men texted and said "My restaurant has closed for 3 weeks, I will take WHATEVER work you have."  It hit me that my tenants (107 units) would likely start falling like dominoes.  Instead of going into all the preparations I am taking, I will stick with answering your questions based on my experience.

1)  I am finding that all prospective tenants have been cancelling their showings, so to me it appears to be slowing down across the entire tenant base, not just Section 8.  As for the Section 8 program itself, up here in MA and I suspect in nearly all Housing Authorities that manage the local Section 8 vouchers, it generally takes 1-2 weeks for the prospective tenant to get their act together in order to present the paperwork to the potential landlord.  Then, they generally perform the inspection which tends to be between 1 and 2 additional weeks.  Up here, I am hearing from closing attorneys that no cities are performing water readings, smoke inspections, etc... and appraisers and home inspectors are not moving either...I can only imagine the Housing Authority...I would generally plan on at lease 1 months elapsed time with a Section 8 tenant under NORMAL conditions.  In this case, I would think this present situation would exponentially impact small government agencies such as housing authorities not to mention the true fall out of this once tenants stop paying rent and emergency rent relief policies take hold etc...I think they will be inundated for several months from when the virus outbreak is actually contained and starts to contract.

2)  I am hoping that the Federal Government will emergency fund the Section 8 program in order to pay for the tenant portion of the rent.  I have decided to see what April brings before I contact the housing authority in regards to my specific Section 8 tenants as in most cases my Section 8 tenants are also on disability which I am thinking will at least allow them to pay normally.  In addition, up here in MA we have existing programs (Homebase and RAFT) that have been in place for many years that act as emergency rent relief programs.  While I am still crafting my exact plan as things change, I will likely help any tenant in need navigate these programs...but as you can imagine they will be deluged.  

3)  I have experienced a bit of the opposite.  While certain cities have banned any construction activities, my area has not yet.  I actually have more handymen/contractors than work I feel comfortable spending cash on.  Since I am trying to conserve cash, I am trying to be careful when and on which projects I should focus.

4) I have always used the BRRR strategy with multi-family and will be looking to do more of them. In fact, I would probably rather have a property that was acquired empty at this point so that I could vet employment information from scratch rather than being stuck with unemployed tenants which I will likely have many. That is assuming you have a strong cash position and can whether both the construction process, potentially lower market rents and any other risk you can come up with. I would not proceed with BRRR without a comfortable cash position.

This is really all off the top of my head so hope it helps.  Stay Classy!

You had me so interested that I contacted one of my insurance agents.  I had noticed that every single policy I have had (I have 24 multi unit buildings) they are all at the $1 Million per Occurrence and $2 Million aggregate.  At first I was guessing that maybe in Massachusetts where I am that the State may have minimum insurance requirements but after speaking with my agent she said simply that the price difference between $500k and the $1 Million was so negligible that the $1 Million simply made sense.  She has always been up front and honest with me so I did not press her on the actual price difference but rather took her for her word.

Hi, I own several small multi family properties (3-7) unit buildings and while for the near term I am preparing for the pending chaos that will erupt when rent is due on 4/1 I am trying to remain positive and focus my attention rather onto what opportunities I should be looking for over the coming months/years.  While I do like the benefits of small multi-family, one thing I am struggling with is whether or not to focus on taking advantage of the 3-4 unit buildings that qualify for the currently low FNMA financing or to venture into larger buildings.  I do like the larger buildings (5+ Units) but local lenders are typically offering 5 year adjustable rate products.  Sure they offer many flavors with differing amortization and terms, but it is the adjustable part I struggle with.  I don't want to take what looks like a great purchase now only to have financing blow up on me in 5 years.  I understand no one has a crystal ball but of course hearing several thoughts always helps.  Thanks for any input you can offer and stay positive, the one thing you can control is your attitude...even that is hard sometimes!