October 2, 2018Re: OPPOSE Rent Control, Eviction Penalties and Relocation Penalties
Mayor Ohtaki and Menlo Park City Council Members -I am a proud mom and pop small housing provider. I do not presume to know about
the intricacies of city government. However, I do know the difficult work of providing housing. Those who do not work in this
field every day cannot possibly understand the nature of our day-to-day business challenges.
We mom and pop rental property owners supply the affordable medium priced housing. We realize minimal return on our investments.
In the first 5 years of owning any rental property, the return is negative. That is correct – owners lose money for years on a new
rental investment. That is due to the high purchase, renovation and maintenance costs. Even for a mature property, housing
providers struggle to reach a 3 - 4 % capital return on investment. Five year CDs are now paying a guaranteed return of 3 %. To
earn that, there are no management challenges or governmental headaches. The Menlo Park city council would be wise to consider the
future. How will you encourage investors to provide any housing at all – including affordable housing – if you seek to punish
providers who are making scarce returns for their risk and work ?
It is worth noting that the data presented doesn’t justify the need for punitive regulations. The fact is that, according to both
the 2015 and 2016 San Mateo County Eviction Reports, as prepared by CLSEPA And Legal Aid, only 0.01 % of all renters over a 3 year
period in all of San Mateo County were faced with eviction. If you must make public policy, be sure that policy is based on
verified facts, not emotional hearsay.
Renters are our customers and friends. We treat them fairly. No housing provider makes money by losing customers through over
pricing. We work hard to keep our renters in their homes. Responsible renters suffer under eviction policies which make it very
difficult for owners to remove the few problem residents. Why make good renters suffer under inflexible eviction policies in which
nuisance neighbors destroy the quality of life for all ?
Onerous, hackneyed ideas such as outlandish relocation penalties or eviction penalties are certain to remove housing from the
market. Why should investors take a huge risk on housing ? Why would they want to supply housing under a constant threat of unfair
policies such as relocation penalties and eviction penalties ?We know that our renters deal with the rising cost of all goods and
services – including housing. Realize that we housing providers are struggling, too ! As proposed, such ill-conceived regulations
do not hold down the cost of housing and rents. Nor do they preserve and maintain units or facilitate the creation of more
housing. We do not need knee jerk responses that would cause renter displacements and increase costs for everyone.
M. K. HaddockProud Housing Provider
