housing-by ll

Until very recently, the City of San Diego enforced several ordinances that threatened rental property in the City – primarily in the area surrounding San Diego State University.
Beginning in 2008, for any house that was occupied by six or more adults, a Residential High Occupancy Permit (RHOP) was required at a cost of $1,000 per year. In order to obtain the permit, parking plans were required to be submitted to the City that demonstrated enough off-street parking to accommodate all but one adult.

In 2017, another ordinance was passed to limit the number of bedrooms in the College Area and city-wide, change the definition of a bedroom, and place further limits on property owners to deter them from creating student housing. The need for these ordinances to address noise, parking, trash, and other nuisances in the College Area surrounding San Diego State, was frequently cited by college area neighbors. However, with minor exceptions, the ordinances address ALL houses in the City of San Diego – whether occupied by renters or by homeowners. With a quick phone call of complaint from an unhappy neighbor, the City would investigate the number of people residing in a house – by inspecting the interior of the home and counting beds and making other observations to attempt to determine if more than five adults were residing in the residence.

If the City deemed the house to be housing more than five adults, a fine of $1,000 was levied with threats of additional penalty if the number was not reduced to five adults only for extended non-compliance.

SDCAA and rental property owners frequently shared concerns with the ordinances with City Council. In addition to taking away the rights of property owners, this ordinance also threatened to create Fair Housing Violations in the rental of houses. With no “law” or “code” governing the number of people who can reside in a dwelling in the State of California, Landlords have typically adopted a guideline used by the Department of Fair Employment and Housing (DFEH) which indicates a use of two people per bedroom plus one person. To limit the number of people in a four- bedroom house to five people would be a matter of consternation and could put the owner of the rental property in jeopardy. Moreover, the enforcement of the ordinance was heavily weighted on rental properties despite be applicable to all single-family homes.

The good news is that in July of this year, a temporary restraining order was placed preventing enforcement of the RHOP and the ordinance passed in 2017 – this after the College Area Renters and Landlords Association filed suit asking the City to rescind this unfair legislation. The judge in the case essentially stated that if the city wants to address problems associated with overcrowded detached homes, it should do so with a law that applies “evenly to all households.” A hearing is now scheduled for December of this year…and it is hoped that the injunction be made permanent.

In a time of scarce housing and rising costs, we are grateful to Judge Styn for placing the injunction and hope that the hearing in December permanently stops the City’s ability to force low occupancy in any rental. Controlling parking can be done with limited parking permits and appropriate patrol – other ordinances exist to help control trash and noise – whether renter or homeowner occupied. Whether multi-generational living or roommates, let’s provide property owners some dignity and support.

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1031?

Posted: 8th November 2017 by Melissa in Video
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FBS Property, AMO is not only your property management company but RE investment advisory as well. Earlier this year we conducted several FBS Open House Educational Presentations on the what, where, why and how of 1031 exchanges to “right-size” your rental property holdings. As with all our advice and management, this is founded on the FBS philosophy for individuals and families to grow your long-term wealth and retirement income. We introduced you to 1031- professionals like Randy Goodsell, CPA and Terry Moore, Certified Commercial & Investment Realtor. With this education and these key players in mind we will bring you from time-to-time some potential 1031 up-leg possibilities as concrete examples for consideration. Should you want to contact Terry directly you can. Should you have questions and concerns that you want to share with someone you already know from FBS please free to do so.” Please consider this your Rent Sense Message from Neil Fjellestad and Chris De Marco

Click the image below to view this listing!

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Property Tax Calendar

Posted: 1st November 2017 by Melissa in Education
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A message from the Executive Director of SDCAA

Posted: 26th October 2017 by Melissa in Rent Sense
 

Oct. 24, 2017

 

Alan Pentico, Executive Director of the San Diego County Apartment Association, released the following statement today:

 

“The San Diego County Apartment Association (SDCAA) is dedicated to maintaining a quality rental housing market for property owners and residents, many of whom are grappling with our ongoing housing crisis. The San Diego region and the state of California are experiencing a massive deficit of homes and apartments. This supply crisis has created affordability issues across the board.

 

“The expansion of rent control, however, would not increase the housing supply we so desperately need. That is why SDCAA is supportive of policy changes that help streamline construction, reduce regulatory barriers and decrease costly delays. Expanding rent control would deter new housing construction, create more supply issues and would not help those most in need.”

 

“A repeal of Costa-Hawkins, as proposed in a potential ballot measure, is a giant leap backward to a time when rent control laws in the state were unregulated and overreaching. Costa- Hawkins corrected unfettered regulation and provides a balance that is a must when regulating the free market. Repealing Costa-Hawkins means rent control could also apply to single-family homes and condos, properties that recently have increased rental housing supply. Rent control could cause some owners to pull their rental properties from the market.

 

“Economists universally agree that rent control is a failed policy that ultimately reduces the amount of available units for rent. Renters, community groups and legislators would be better served by joining with SDCAA and other organizations to advocate for more housing, of all types, at all price points. We must all look to the future and work to meet demand, which is estimated to be over 70,000 units by 2030 throughout the San Diego region alone.

 

“We are all members of the community and by working together toward a greater goal, we can make positive change.”

 

KTS Legal Questions- October 2017

Posted: 26th October 2017 by Melissa in Legal Questions
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FBS operates Rental Properties for Independent Owners utilizing Industry Best Practices which creates direct benefits to our Rental Customers. We have provided Superior Housing Alternatives now in our 5th Decade. Our available rental inventory changes daily. www.fbs-pm.com

As professional managers we must stay on top of local, state and federal laws, regulations and housing codes that are imperative to our clients and rental customers. We review and update our contracts, policies, forms and routines with the help of KTS (Kimball, Tirey and St. John)
Ted Kimball, Esq. weighs in:

Landlord/Tenant Questions & Answers
Ted Kimball, Esq. October, 2017

1. Question:
I rent out a three-bedroom home with a covered patio that I have turned into a fourth bedroom. There are four individual people renting. My question is, can I call it renting rooms or am I renting a house to four different people?
Answer:
It is better if you rent the house to all four under one lease with each tenant being “jointly and severally” liable, meaning they are individually responsible for the lease, as well as collectively.

2. Question:
The previous owner of an apartment building I recently purchased allowed the tenants to pay half a month’s rent on the first and the other half on the fifteenth of the month. The lease, however, says it is all due on the first and I want to enforce the lease. What, if any legal problems do I face?
Answer:
California judges may find that there has been a modification of the payment terms of the agreement by “mutual consent and execution” of the new payment terms. Many leases have a provision which states that one waiver of strict enforcement of the terms does not constitute a continuous waiver for subsequent breaches. If the agreement contains this clause, the court should rule that the rent is all due on the first of the month.

3. Question:
One of our tenants is complaining about the carpet and says it is California law that the carpeting must be changed every seven years. Have you heard of any law on this subject? Answer:
California law does not require landlord to replace carpeting, unless the condition of the carpet creates a health hazard or risk of injury.

4. Question:
When tenants give notice that they will be vacating the residence, is it permissible for me to give them a notice stating that I will be advertising the vacancy and will be showing their apartment? Answer:
Unless the tenant agrees to another arrangement, you would be required to give reasonable notice (24 hours) in writing for every entry.

5. Question:
I have a “Guarantee of Rental Agreement” from the mother of a tenant. The tenant is twelve days late with the rent. Do I have an obligation to notify the mother and give her the chance to pay? What is my recourse against her if she refuses to live up to the guarantee agreement?
Answer:
Notifying the guarantor may be a requirement depending upon the language of the guarantee agreement. You may want to advise the guarantor in any event and send her a courtesy copy of the three-day notice before taking action.

6. Question:
Is it necessary that a notice to perform or quit be for three days, or can I choose to give an otherwise good tenant more time to solve the problem?
Answer:
You can give the tenant more time to respond to a breach, but it should end with a three-day notice. You could write the tenant that you are going to allow them to cure the breach by a certain date and if not cured by then, a three-day notice to perform will be served.

7. Question:
How many protected classes are there in California?
Answer:
In addition to the seven federal protected classes (race, color, religion, national origin, sex, familial status and disability) California has thirteen protected classes, some of which are unique to California. They are: marital status, age, ancestry, sexual orientation, source of income, medical condition, gender, gender identity, gender expression, genetic information, citizenship, immigration status and primary language spoken. California also prohibits discrimination based on the perception that someone is from a protected class or is associated with someone from a protected class. Finally, it prohibits discrimination on any arbitrary basis.

 

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Ms Management Oct 2017

Posted: 11th October 2017 by Melissa in Ms. Management
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Carol Levey, writer and creator of Ms. Management also appears as a guest blogger on Rent Sense. Her insights appear in dozens of other industry publications across the country. Carol is a regular presenter at the annual AAMD Education Conference, has served as MC Host for Award Events, and consistently over 35 years of volunteerism taught & authored curriculum for AAMD Education. She has been acknowledged for her outstanding contribution as an Industry Supplier becoming the recipient of the Jack Shapiro Award Winner twice; in 1987 & 1990.

Carol Levey is perhaps more recognized at the national level as an educator in the real estate industry. She served as one of the original team that produced the National Apartment Association coursework leading to the respected NALP designation. Her company Levey Enterprises has provided temporary leasing specialists, site managers and marketing offsite personnel to major apartment community operators throughout Colorado and across the U.S. Her business was founded on decades of experience in property management and executive leadership as a third-party leasing and corporate housing provider.

Read on for this month’s Ms. Management Q and A!

Q – I’m a leasing agent for almost a year now. I’m a good closer but I’m getting stiffed and here’s why – we have a stupid rule. First to show gets the dough. What I want to know is am I going to run into this limitation to my leasing bonuses at other properties or companies. Is this an industry thing? I’d like to understand the pros and cons of this system.

A – In my experience with all kinds of onsite teams across the nation I have encountered several methods being employed. Though the method you are experiencing is a popular one there are certainly variations. For instance, some teams stipulate that the bonus goes to the one that physically tours the property or the one to get the application. Usually these methods require that the application to be processed is complete and accompanied by money. Some go further to define “complete”. Other teams choose to pool and split leasing bonuses. As you can imagine there are pros and cons to any devised method to recognize individuals while maintaining leasing as a team activity. Some companies have gone so far as to converting community leasing specialists to full commission; at least on new lease-ups, especially during construction or property repositioning. Other companies have decided to eliminate leasing bonuses entirely and/or have implemented other measurements to use for individual and/or team bonusing. There are also severe swings in market conditions that govern. For instance, in a market of many high-price alternatives our potential leasing customers are going to investigate more properties looking for the “best bang for their buck.” It stands to reason that such a customer will also re-visit each property of interest more times and might purposely inquire with different members of the team to learn something else.

If you believe that the policy that governs your leasing bonuses is not fair to you and/or you think you have a better idea then speak to your supervisor. Remain open minded to existing policies and willing to see if there are examples that are to your advantage. What I believe you will find is that whatever the policies are it requires strong leadership to hold everyone to the same set of standards over a sufficient period. Performance standards must be maintained through written policies that should be understood by the entire team. If policies are managed consistently over time the benefits will normally favor longer-term members of the team. This should mean that someone getting the short straw this time will likely benefit next time.

KTS Legal Questions Sept 2017

Posted: 4th October 2017 by Melissa in Legal Questions
 

FBS operates Rental Properties for Independent Owners utilizing Industry Best Practices which creates direct benefits to our Rental Customers. We have provided Superior Housing Alternatives now in our 5th Decade. Our available rental inventory changes daily. www.fbs-pm.com

As professional managers we must stay on top of local, state and federal laws, regulations and housing codes that are imperative to our clients and rental customers. We review and update our contracts, policies, forms and routines with the help of KTS (Kimball, Tirey and St. John)
Ted Kimball, Esq. weighs in:

1. Question:
Our tenant owes us back rent and is stating that he is probably going to file bankruptcy. We’ve been trying to work with him but are getting nervous now. Do we lose all the back rent if he files bankruptcy?

Answer:
It depends. If he files a Chapter 7, there is little hope. If he files a Chapter 13, you may receive all or a portion of the back rent.

2. Question:
If a tenant’s rent is due on the first day of the month and there is no grace period, what is the earliest date I can serve a 3-day notice to pay rent or quit?

Answer:
You can serve a 3-day notice to pay rent or quit when the rent is legally delinquent. California law requires that one business day must expire before the rent is considered delinquent. So, if the first day of the month falls on a weekend or holiday, you must wait until the day after the first business day expires before serving the notice. If the first day of the month is a business day, the notice can be served on the second of the month.

3. Question:
If the landlord accepts a rent payment from someone other than the lessee, does that give them any rights?

Answer:
It could if they are occupants of the property. They would have to convince the court that they are now tenants under a verbal agreement.

4. Question:
There was a grease fire in one of our rental units due to a tenant’s lack of knowledge of cooking. What is my obligation to provide alternate accommodations for this tenant? Am I required to keep her as a renter?

Answer:
You are not obligated to put the tenant up. You may have a right to evict her based upon waste of the unit, which requires a 3-day notice to quit.

5. Question:
The tenants living in one of our apartments signed a one-year lease which states that there will be no pets allowed. They now have two cats in the apartment and are only in the second month of the lease. We served a 3-day notice to perform covenant or quit. They have chosen to leave. The rent for the entire month was paid. Are they entitled to the prorated amount of rent for the unused portion of the month?

Answer:
No, they are liable for the remainder of the lease or up to the time you relet the premises, whichever occurs first.

6. Question:
My tenants paid an extra deposit for a pet. They gave away the dog after 2 months. Now they are asking if the pet deposit could be returned.

Answer:
You do not have to account for the use of the deposit until 21 days from the date they return possession of the premises, so you don’t have to refund any of the deposit.

7. Question:
What is a request for a reasonable modification?

Answer:
A reasonable modification is a physical change to the apartment or the common areas that is necessary to afford a resident with a disability full and equal use and enjoyment of the rental property.

8. Question:
I rented an apartment to a young man; he signed a one-year lease and paid the deposit and first month’s rent in full. He moved in today and less than 24 hours later, he is requesting to get out of his lease because another apartment that he prefers became available. Is there any kind of buyer’s remorse on signing a lease?

Answer:
Your tenant is obligated to pay rent through the lease term or until the time the premises are relet, whichever occurs first. There is no buyer’s remorse.

9. Question:
My tenant claims he paid the rent by mailing us a money order. We never received it and he says we should have received it. Who would bear the loss if we do not find the missing payment?

Answer:
Under most leases, it is the responsibility of the tenant to ensure the landlord receives payment. Since it is up to the tenant to choose the method of delivery, he or she bears the risk that the payment is in fact made. However, some leases determine the method of delivery. In those cases, the landlord may bear the risk that the payment reaches the landlord.

10. Question:
One of the recent applicants to our apartment community claims he is paid “under the table”. How do I verify his income?

Answer:
You really can’t, and because he is committing fraud, you should not consider this a legal source of income. If they fail to otherwise qualify, you can deny his rental application.

11. Question:
One of our tenants was recently arrested and has not paid the rent. We served a notice by “post and mail” and it has been over three days. How do we serve the unlawful detainer (eviction) on the tenant while in jail?

Answer:
Most jails will allow your process server to serve the tenant while in jail. It may take several hours before they are able to pull the inmate up, but your process server can be waiting for him or her and legally serve them while incarcerated.

12. Question:
One of our residents served us with a written 30-day notice and has failed to vacate after 30 days. Can I start the eviction process or must I serve a 30-day notice first?

Answer:
If a residential tenant serves the landlord with a written 30-day notice and the rental term is month-to-month, the landlord may immediately file an unlawful detainer (eviction) action in court on the 31st day, providing the 30th day fell on a business day.

Ms. Management Sept-2017

Posted: 21st September 2017 by Melissa in Ms. Management
 

Carol Levey, writer and creator of Ms. Management also appears as a guest blogger on Rent Sense. Her insights appear in dozens of other industry publications across the country. Carol is a regular presenter at the annual AAMD Education Conference, has served as MC Host for Award Events, and consistently over 35 years of volunteerism taught & authored curriculum for AAMD Education. She has been acknowledged for her outstanding contribution as an Industry Supplier becoming the recipient of the Jack Shapiro Award Winner twice; in 1987 & 1990.

Carol Levey is perhaps more recognized at the national level as an educator in the real estate industry. She served as one of the original team that produced the National Apartment Association coursework leading to the respected NALP designation. Her company Levey Enterprises has provided temporary leasing specialists, site managers and marketing offsite personnel to major apartment community operators throughout Colorado and across the U.S. Her business was founded on decades of experience in property management and executive leadership as a third-party leasing and corporate housing provider.

Read on for this month’s Ms. Management Q and A!

Q – I’m a regional vice president for a leading property management company. I’m recently experiencing more difficulty holding onto key team members. The economy is returning and offering more
external opportunities; in and out of our industry. I believe that people are leaving important team assignments that will lead to promotions and employment satisfaction within our company. It’s frustrating to see and I need to believe we can fix this. What recommendations can you provide?

A – First, I need to pass along some perspective. As an economy, we are emerging from a prolonged recession and recovery period during which individuals were concerned to obtain and keep a job. Since our industry consistently hired during the recession while others did not it stands to reason that we might have captured and/or kept employees that we might not have if other options existed. The slow recovery kept us from facing the underlying regional reality that there are not sufficient qualified people to fill the additional employment requirements within our industry. So, the reality is that finding and hiring as well as training, retaining and managing career tracks are the real industry challenges for the foreseeable future. Don’t be discouraged by this new reality. Rather, attack the problems strategically.
I suggest that you update your strategies and methods in favor of creating an environment conducive to multiple generations. I say this knowing that most industry companies are steered by boomers and the culture and communication style of such companies need a re-boot to accommodate millennials. By doing this you will find that the working environment will better support everyone. Examples include –

• Create a communicative style that is direct, transparent and collaborative. Clarify upward mobility while managing expectations about needed experience and education.
• Put them in charge of their career providing support including onboarding that points them to where company resources are kept, who to ask and when, how to get started and why.
• Build a learning environment with individualized video and/or computer-based presentations, experiential checklists, coordinated peer shadowing including Q and A sessions.
• Schedule higher frequency for periodic evaluation and feedback that emphasize your willingness to listen and coach while directly and transparently letting each employee know where they stand at this moment.
• Provide constant support with ongoing education and advance technology so each team member believes that they are growing because they are staying.
• Know each team member better by asking them what they think and feel; giving them real responsibility and credit for performance. Find out what engages them versus what is wearing on them. Always give them general encouragement but also hands-on help for tough specifics that they can’t budge.
• Whose opinion is important to them; parents, siblings, friends and significant others? Ask about those opinions of their current economic status compared to others and/or expectations.
• Finally, remember that you are going to experience turnover no matter what you do and you want to upgrade your team no matter how good they are so recruit and interview as an ongoing priority. Your existing team needs to see that your company is “the greener pasture.”

Meet Neil and Chris….

Posted: 15th September 2017 by Melissa in Uncategorized
 

Meet Neil and Chris, the authors of Rent Sense. Let them introduce you to their company as they did in this recent television network interview. This brief clip might also introduce you to the $9 billion annual rent collected in the region as an essential industry mostly composed of small independent rental ownerships like yourself.

Neil Fjellestad and his wife Cheery founded a real estate investment company built on the unique requirements of individuals wanting to create wealth and financial independence. Neil had been Director of Brokerage Services for a statewide real estate company since his graduation from SDSU three years before. This company specialized in apartment and commercial transactions throughout California; particularly 1031 exchanges. The young couple had already acquired a small personal portfolio of apartments besides their first home. Neil had discovered a continuous flow of real estate investors came from the adult classes in R.E. Law, Investment Analysis & Taxation he taught for the SD Community College District in the evening.

In business, as in families there are generations. Generations of hard work, education, excellence built upon integrity. Beginning in 1972, hundreds of aspiring professionals built that initial generation bearing the Fjellestad brand of brokerage, consulting and management.

Chris DeMarco joined the Fjellestad companies in 1989 with a unique combination of small business acumen, property & people skills, a famous mid-west work ethic; a practical passion that after time became the driving force for a needed change; the beginning of our 2nd company generation. Still active in the company, Chris & Neil alongside four other key leaders including those from our 3rd company generation make a multi-generational executive team blessed with 125 years of combined experience to ground them while navigating the demands of today’s unique millennial growth.

FBS operates single rental homes and condos, apartments and commercial buildings in 69 zip codes. May we help with your property?