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Hagerstown housing: The bad news is about to get worse

June 11, 1997

If you follow news reports about the City of Hagerstown, you probably know some of the bad news about housing. Too many city families - about 60 percent - live in rental housing, and many of those have to settle for sub-standard dwellings because renovation costs would push rents beyond the ability of many to pay.

As if that weren't enough, now the president of a group described by a city inspector as Hagerstown's best landlords says many of his members would like to get out of the business altogether.

"I'd love to sell my properties for what they were worth five years ago," said Richard Chaney, president of Landlords and Property Owners of Washington County, Inc. He can't he says, because of the state's lead-paint inspection law, which is so unevenly enforced that his members who comply are at an economic disadvantage.

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"There are 1,080 landlords who are registered in this county, and I bet there isn't 10 percent of them who are complying with the law," Chaney said.

Complying means undergoing inspections that cost $100 to $159 per unit and $11 per lead-dust "wipe" inspection, Chaney said. Getting the results can take five to seven days, which means the unit must sit vacant during that time - and maybe for an entire month.

Because windowspreviously painted with lead paint are a special problem, Chaney says a lot of his members are trying to replace them, which increases their costs. When their costs go up, so must rents, and when you're competing with guys who don't even bother, they can shave their rents by $25 or more per month, Chaney said.

Now at this point you may be saying, well that's too bad, but why should I worry about some landlord's problems?

You should worry, because if the cost of doing business increases without increasing the landlord's profit, then More landlords will try to sell. Chaney says that's happening now, with some properties unsold for up to two years.

At some point those properties will either: be sold for a loss, or the owners will appeal their tax assessments. Either way, tax revenues will go down and the people trying to do a good job will be replaced with people who either can't afford to do the work, or who flat-out don't care.

As Chaney explained to me, there are two ways to be a landlord: Keep up your buildings and attract good tenants who stay for long periods of time, or skimp on maintenance, and take on tenants who can't afford anything better, or who other landlords would rather not rent to. Once you start down the latter path, Chaney said, "it's a downward spiral."

Chaney does see some hope in a recent proposal by Councilmember Susan Saum-Wicklein, who said she'd like to see some rental apartments in the city converted to condominiums, an idea I've advocated for years. Chaney suspects, however, that it would be a complicated and expensive process.

Does it have to be? Maybe, if the property owners had to fight their way through the red tape all alone. But what if the city government helped, by using some of its annual block grant funding to do a demonstration project showing property owners what's possible and how to go about it?

The city government could also help by putting all property owners on a level playing field with a beefed-up inspection program.

Right now, according to Mike Heyser, a city inspector, said that "there's two ways a building gets inspected. One is if a complaint is filed. The other is as part of a systematic inspection program."

In the latter, letters are sent to property owners in a targeted four- to six-block area. The letters invite the property owners to accompany them, but Heyser said, "many times it ends up being an exterior inspection" if tenants don't want to let her in.

"We have talked about `rental registration', and I suspect we will be asked to submit some sort of proposal."

"Rental registration" willtake effect on July 1 in Cumberland, according to Jeff Repp, the city administrator, who says that the plan was enacted after much debate over the effectiveness of the city's complaint-based law, passed in 1988.

"It's been an ongoing issue up here," Repp said, adding that although the council felt there were only "a couple of problem landlords," there were enough sub-standard units among the city's 3,300 rental units to justify the plan.

Registration costs $15 per year per unit, Repp said, and inspections take place when tenants change, unless there's been an inspection done in the previous 12 months.

This will be in addition to anything the state does in the way of lead-paint inspections, Repp said.

Some businesspeople will see it as the same old story - government bureaucrats who don't understand profit-and-loss economics conspiring to make it more difficult to make a living. It turn out that way, unless government takes a hand, and explores possibilities like:

- helping arrange bulk purchases of replacement windows to cut the cost of lead-paint-law compliance, and

- exploring the Rev. Philip Hundley's idea of training youths in the building trades by renovating older buildings under experts' guidance. Once dismissed as too expensive, such a plan might be cheaper in the long run than the costs the area will incur to house people who've been preiced out (or grossed out) of their other options.

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