Slumlords Do Disservice To The Rental Housing Industry

At TMHA we believe landlords offer a very valuable service to our county. We could not operate this program without your cooperation, and we are keenly aware of it. Keeping that in mind, we try to work with all owners in an equitable and common sense way, within parameters of the HUD regulations. However, we also know that a few “bad apples” can always spoil the bushel, and can give honest owners legitimately trying to make a profit a bad name.

The following article was taken from Rental Housing Online For Tenants & Landlords and was written by a landlord. We have included it for your interest. It provides the view of how “slumlords” can harm the rental housing industry, and devaluate all rental properties in a community if too pervasive. Here is the contributing landlord’s opinion.

Most good and scrupulous investors try to maximize their return on investment by taking advantage of all three possible benefits. They do it with financial and tax planning, careful purchase of each property, good property management while they own it, then professional marketing of a good product when they decide to sell it.

However, there are short sighted fools who rape neighborhoods and steal money from a property by just chasing cash flow with no thoughts of the long term ramifications. As a result, slumlords destroy properties and neighborhoods while negatively impacting the lives and hopes of poor tenants and their children. They also miss a chance to make a decent profit while building long-term financial security by investing intelligently in rental housing.

Typically, a slumlord looks for an opportunity to buy a structurally and aesthetically challenged property for little or no down-payment. That kind of deal is all to often available from someone who bought something that was fairly decent, but then “milked” and mismanaged the property until they could no longer stand to deal with the maintenance problems and the kind of problem tenants you get with a problem unit. A slumlord is happy to take over any junk property they can get cheap, with little or nothing down. Why not, they don’t even intend to finish paying for it anyway. Their whole goal is to put the least amount of money possible in the property and take the most they can get out of it—for as long as they can. A slumlord is not usually concerned about tax benefits, because they try to collect as much of the rent in unreported cash as they can. They are not concerned about appreciation because they intend to abandon the property when it has finally been milked dry.

When a tenant moves out and leaves a mess, a mainstream landlord cries, cleans, repairs and repaints. Then they try to do a better job screening their next tenant. A slumlord just lowers the rent on the trashed property until some poor soul will take it as is. Then it’s the same scenario with the next tenant, and the downward spiral continues until the cash dries up from the last desperate tenant willing or forced to live in squalor.

It doesn’t take many derelict properties to run down a neighborhood. A bad neighborhood leads to more slumlords and more abandoned properties. The cancer continues to spread and always will unless and until someone stops it. We in the business of providing decent, safe, and affordable housing at a profit, must educate the short sighted fools who chase a quick buck while sacrificing a better long-term return. If they won’t learn, we must ostracize them, and help government to weed them out.
 

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