Does Section 8 Housing Overpay for Lakewood Doubles?

[Jim O'Bryan]

Ken/Phil

I agree the real numbers would be interesting as would how this study would be paid for.

It just occurred to me that what many of these realtors and or other slum landlords are doing is land banking. One of the things that never made any sense to me is why would a businessman take two doubles that could easily bring in $1,500 hundred a month each. Tear them down and build a parking lot that at best would bring in $2,500 a year?! We know the answer was land-banking with tax loses.

So if you buy a double in Lakewood for $250,000 put $50,000 down finance the rest, you would break even on payments, and be land banking with a better profit. Also you would be making about $200,000 every ten years as you paid off the note. Not bad if all you care about is bottom line.

But this is where we differ. The secret is to raise values out of reach of Section 8. This is where the three families wanted to rent the single because that was the only way to pay the rent. So if we boost property values and MAKE property owners keep their property up they will once again be the natural selection that keeps Section 8 housing at a manageable level. When the value drops, or the building becomes cheap to own then you can fill it with Section 8 make money and laugh all the way to the Westlake branch of 5th 3rd.

Again I have to say I am not against Section 8, but it has to be a fair proportion. Lakewood has a beautiful diversity on every level, but if anything gets thrown out of kilter, it unbalances everything. Let's be honest does the strip between Bunts and Clarence need more Irish Bars? I have to think not.

peace

[Kenneth Warren]

Jim:

Unless the Lakewood Observer is making you far richer than you are letting on, your approach sounds naive to me in that you suggest possession of "the secret... to raise values out of reach of Section 8."

I realize I am a Cowan, an ignorant builder of the Lakewood brand - but can you make explicit "the secret?"

Or do I have mail in a check and watch the video that will teach me how to sell Lakewood doubles for double the current price?

Looking out from the blindfold toward the Emerald Canyon,


Kenneth Warren

[Jim O'Bryan]

Ken

I am far from rich and I get farther every day. Last time I checked I will be able to afford retirement about 6 days after I am dead. My wife just told me last year we had saved enough to use real butter on our Kraft® Macaroni and Cheese. Since starting the paper we are back to bulk margarine, and about to loose the milk for water.

Still a good double is over $200,000, on the westend as high as $330,000 or higher like the brick one near my house. The one I grew up in went for $210,000 and it is not that hot. My friend just got one on Hopkins for $165,000, and has dumped another $75,000 in but has a renter that loves the place. The brick near me rents for $1,650 a half, and they have rarely been empty. He advertises this beautiful duplex only at a local college. The gorgeous 5 bedrooms, clean 3 car garage, and beautiful canyon view keeps them filled.

I have found the secret for getting a good price is to make it real nice, real clean, and never panic in the deal. The house has sat twice since we bought it empty for 6 months each. We never folded on the price, and both times we have ended up with great renters. The first ones were here for 8 years. Of course we go against almost everything most landlords go for.

I think what happens with mostly absentee landlords, it is all bottom line. If they can get someone in immediately the faster it is paid off. Quality not speed is what we look for. In return we give them a dream deal. Discounts for early pay, cutting lawns, shoveling. A nice allowance every month to take care of any repairs that are needed. A phone number to our plumbers, electricians with a call them anytime. We have a pretty realistic view on parties. Respect the house, the neighbors and my family and we respect them in return.

I rented until the age of 35. The nice landlords and nice rentals are worth a premium.


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[Kenneth Warren]

Jim:

Good answer.

Do you see yourself organizing an ensemble of Lakewood investment property owners around your model in the effort to enhance the value of property and social order in any particular neighborhoods of the city and to minimize the damage from unscrupulous investors?

Is such a strategy part of the Visionary Alignment?

Kenneth Warren

[Jim O'Bryan]

Jim:

Good answer.

Do you see yourself organizing an ensemble of Lakewood investment property owners around your model in the effort to enhance the value of property and social order in any particular neighborhoods of the city and to minimize the damage from unscrupulous investors?

Is such a strategy part of the Visionary Alignment?

Kenneth Warren

Ken

I think it already is.

Look at the property values in Tremont. A single over looking what was steel and pollution now WalMart for $300,000!

It is all about building the brand. Tremont built one and damn, what is still a home in the hood is near gold. You tell me what was the big change between now and 1985 when my buddy bought the Literary Inn? Not much more than the perception of cool.

You give me a person about to buy in Termont and take him to my modest house in the fall with the Emerald Canyon in full fire and I would have to be able to get $750,000. Think of what you can walk to in Tremont, and what can be walked to in Lakewood. That alone should double the price of Lakewood property. Then we are ten minutes from Tremont, and ten from Crocker Park. I think low self esteem has kept us back from marketing common sense.

How many public pools service Tremont? Schools? Galleries? Restaurants? I have to think on all we have more and at least equal or good enough to hold our own. Local Girl "Best Gallery in Cleveland," Aladin's "Best Foreign Food." and on and on for 17 different things.

Ken, early in our rental life I read a book that went against all norms, but it made so much common sense. Little things like look for people with pets. Their lives are more level, do not move about, and have the ability share love and accept responsibility. Do we have the possibility of accidents? Sure but this is why God made carpet cleaners and security deposits. I bet almost ALL absentee landlords say NO PETS.

But i think the rentals will come into their own very soon. Rates are climbing so people that waited are already screwed. Plus there is always a certain group that do not want to buy, can't buy, or simple cannot do the math on owning versus renting.

Lakewood's psychosis with filling doubles over the past five years was crazy an unrealistic. The Fed and home buying is cyclical. Doubles will become need and coveted just about the time Lakewood turns half it's doubles into singles and help finance the change!

Right now doubles on the westside near the Entertainment Zone are hot. Can the neighbors accept drunk college kids living in the area with Cleveland State, BW, Tri-C 15 minutes away, and bars 5 minutes walking? If they can their streets are paved with gold.

Again in my simple mind this is common sense. Rent a place you would want to live in, and the rest will follow. Respect is a beautiful thing.


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[ryan costa]

Section 8 sounds like a good way to make housing more affordable. It may have worked in Cleveland. I could probably score a big house with a big front lawn with big trees on West Boulevard for under 120 K. They are built solid; enough to stop most bullets. And I can use the savings to brick up the front windows and send the kids to private school.

I am against carpet: Nothing so difficult to clean should exist. Ceramic or concrete tiles are where it is at. Carpet is for people in danger of falling because they are old or ill or alchoholic.

[Jim O'Bryan]

Chris

These are social groups that are paid to find housing for homeless, disabled vets, paroles, etc. I have NO PROBLEM with the groups, all mean well and everyone I know associated with them truly have their hearts in the right place. It is just they have taken advantage of low rents and lazy landlords in Lakewood. I wonder aloud if a large concentration of Section 8 help or doom a city? This is why I try to say "fair share." Section 8 is a good program if we all share the burden. If the burden is dropped on one city, then other city and their residents market their city as not being filled with section 8 I get a little tired.

It is like No Child Left Behind. Lakewood Schools take a disproportionate number of "special need" children in from Rocky River, Bay, Westlake. Then the NCLB grades come out and we are 1 point lower. Those that do look into quickly see the one point is the kids we take in! I bet the Chamber of Commerce in Rocky River, Bay, and Westlake love to show those numbers to their perspective residents and businesses. How fair is that?

As fair as faulting landlords for taking the easy road. I see renting property like much of life as a fork in the road. One way is easy, the other tougher but more rewarding. Next time we are at Bela remind me I can tell you three easy ways to get more than you are asking in rent guaranteed and the number 8 will never appear.

No landlord in this town has any legitimate excuse to let property run down. The city has plans that can help pay, finance or get down things to 95% of all of the homes in Lakewood. What is the excuse for cashing in outside of greed?


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[Bill Call]

Section 8 housing has proven to be more successful than projects.

........ My mother always said "there, but for the Grace of God, it could be you or me."

The theory behind section 8 is very sensible. The vision was that people who could not afford housing would be provided a reasonable subsidy to find a rental on the open market. By dispersing that population in and around middle class neighborhoods the problems associated with concentrations of poor people would be diminished.

I support the program as an alternative to the traditional public housing projects. Those projects generally become the centers of crime and self destructive behavior.

However, when the program targets a particular community the original theory breaks down. Instead of concentrating the poor in public housing tracts the Section 8 program concentrates the poor in what was once a middle class neighborhood.

Targeting a community for the Section 8 program creates a privately owned public housing project.

That new "project" has all of the ills associated with the public housing project with none of the social programs that exist on site at the traditional public housing project.

To the extent that these "well meaning" people (I don't agree with that description) target a community and concentrate section 8 housing they do great damage to a community. They are the 21st century version of the real estate "Block Busters" of the 50's and 60's.

I first became interested in this issue when I found that a Section 8 tenant's contract rent for a two family house was $800 per month in an area where the market rate was only $600 per month.

The City has no power to change the program. It does have the power to demand that the program managers follow Section 8 guidelines.

I am going to take up Ken Warren's request and do a little digging on this issue. I will be asking for information about market rents, the number of two family units occupied by section 8 tenants and the rents for each of those units. I will limit the request to information on Lakewood.

I estimate that it will take approximately 50 man hours and one year to get information that is in a folder sitting on someones desk

If I find that the program is paying market rents then the City will have to devise a housing strategy that makes City housing more marketable to traditional tenants.

If I find that the program is paying more than market rates then I think we are within our rights as a City to ask that the rents be adjusted.

Of course I don't know why private citizens must do what the City should have done two years ago.......

[Kenneth Warren]

Bill:

Thank you pursuing this topic.

I understand from Lakewood Observer Dan Slife, who has attempted to obtain information on the Lakewood program from CMHA, that it is difficult to obtain.

Seeing the interest in this topic, I called CMHA and was referred to B. Palmore.

I left a voice mail and requested a copy of the Rent Reasonableness Study for Lakewood for placement in the library's reference section.

I have not yet received a reply.

Her number at CMHA is 426-2747.

Perhaps she can point your inquiry about data in the right direction.

By the way, "Section 8" is now called "Housing Choice Voucher."

Kenneth Warren

[john crino]

I would consider this "tageting" lakewood:
FROM THAT OTHER WEBSITE IN TOWN:



" Posted 05-02-2006 12:07 AM
http://finance.groups.yahoo.com/group/w ... n8tenants/

Consider Becoming a Housing Choice Voucher Program Landlord we need good landlords.

Housing Choice Voucher Program tenants typically pay up to 40% of their adjusted income for rent, while a rent subsidy (paid by CMHA Housing Choice Voucher Program) covers the difference between the approved contract rent and the tenant's rent payment. This guarantees Housing Choice Voucher Program landlords will receive a portion of the rent on time each and every month.

Being a Housing Choice Voucher Program landlord provides the satisfaction of making it possible for low-income families to enjoy quality, affordable housing. Landlords benefit as well by enjoying the following aspects of the program:

* Stable payments
* Yearly inspections of the unit(s)
* Fair market rental rates
* Renter responsibilities defined in the lease addendum
* On-time payments from the first of each month


Housing Choice Voucher Program Newsletter

This publication keeps landlords and Housing Choice Voucher Program participants up-to-date on program changes, answers commonly asked questions, advertises trainings conferences and much more. In addition, there are periodic notices enclosed in the check distributions.
Landlord Response

MHSD is available by phone Monday through Friday, 7:30 AM - 5:00 PM. at (480) 644-3536. Landlords can get immediate answers to their questions.
Landlord Reference Service

When considering renting to a Housing Choice Voucher Program participant, landlords may call the MHSD caseworker to obtain the prior owner's name and phone number.
Additionally,

It's just good business to meet the needs of your community by providing good affordable housing to tenants, and there is also the guaranteed rent. You can bank on receiving your Housing Choice Voucher Program rent subsidy check on-time each month. You will also benefit by joining the network of over 5,000 Housing Choice Voucher Program Landlords in Cuyahoga County who are successfully providing housing to nearly 10,000 families.

Click here for the Easy Steps To Becoming a Housing Choice Voucher Program Landlord.
To list your rental unit with us for potential Section 8 clients, go HERE and upload an Adobe .pdf form!

If you have further questions please call:

Aileen Murphy
Housing Supervisor
480-644-3545 "

[quote][/quote]

[Bill Call]

I left a voice mail and requested a copy of the Rent Reasonableness Study for Lakewood for placement in the library's reference section.

I have not yet received a reply.

I have dealt with CMHA in the past. People very rarely answer the phone. I would leave one voice mail per day until the voice mailbox was full. Then you couldn't reach them or leave a message.

[Phil Florian]

I have some questions about Bill's concerns. If it is only the prices that Section 8 allows negotiated with landlords (this isn't always the money that Section 8 pays as there is a tenant responsiblity, too) then I don't have a point on that, yet. But Bill has brought up some other points that I wanted to tease out a little.

"That new "project" has all of the ills associated with the public housing project with none of the social programs that exist on site at the traditional public housing project."

What are the "traditional social programs" that only exist in public housing projects? And how are they different than the other social programs available to everyone else? Does the family need help getting a job? They can access all sorts of programs, both public and private, to help with this such as RSC if the job loss is disability related, a variety of school programs to get adults the education they need to pursue work, and the granddaddy of them all, the Ohio Department of Job and Family Serivces, has offices all over the county. Is it help with housing? Eden Inc. on the West side assists families in need to find and help pay some upfront costs for moving. Local shelters do, as well (Cleveland Hospitality Network, etc.). Help with food? Food banks are all over the city and many churches have free meals and food programs throughout the city of Lakewood and into Cleveland. So really, besides the instutionalization of housing issues found in a Pubilc Project, what can't be replicated in the community?

"To the extent that these "well meaning" people (I don't agree with that description) target a community and concentrate section 8 housing they do great damage to a community. They are the 21st century version of the real estate "Block Busters" of the 50's and 60's."

No one is holding a gun to landlords heads, as far as I know. Do we have evidence to the contrary? Section 8 housing needs landlords and many of Lakewood Landlords need tenants. It isn't CMHA's responsiblity to say, "no, we don't want to house any more people in Lakewood" it is the landlords that have to make that decision. As some landlords on here have pointed out, some have lucked out or had the resources to hold out until non-Section 8 tenants came around but not all landlords have the resources or the luck. I don't see why this is CMHA's issue. And more importantly, what is the alternative? If no Landlords in Rocky River want to have Section 8 and higher rent fees isn't enough of a carrot, would you advocate a sort of eminent domain where a landlord's rights are usurped and they suddenly must take Section 8 clients?? Or should we, as you put it, concentrate them in another community, just not ours?

"The City has no power to change the program. It does have the power to demand that the program managers follow Section 8 guidelines."

I am assuming this still has to do with the money question, not the other guidelines (condition of property, landlord/tenant relations, etc.).

"Of course I don't know why private citizens must do what the City should have done two years ago."

This I can agree with but then again, if I have learned anything in the last 6 years is that we can't simply sit back and wait for the government (at any level) to do the right thing. Since the media is no longer the watchdog of the governement (as it was once intended) then that role falls to interested citizens and for that I applaud Mr. Call and others on the Observer.

As noted, my disagreements with points above have nothing to do with the financial end of things as Mr. Call is most interested (and was the original point in the thread) but even this post as well as many others have gotten into issues beyond that and I felt the need to address them or at least get an idea on the points of view.

Good luck with the information hunt! I have a contact I used to work a lot with at a contract agency that works with CMHA and I will try to chat with him next week to get his perspective on this and will post what I hear from him when I get it (and he answers his phone, too!!).

[David Anderson]

Just a few comments on earlier posts.

1) After reading these posts, no wonder the CMHA offers more than market value for rentals - they have to in order to get past landlord bias against Section 8. Offering more than market value appears to be the only way to get their clients any accommodations in Lakewood.

(Also, I don't think it's important for us to acknowledge that doubles closer to Riverside Drive get around $50-$100 more per month than those between Hilliard and Bunts; and $150-$200 more than those between 140th and 117th.)

2) Regarding ones appreciation for living in Lakewood, I'm not sure that there's a difference between a regular tenant's and Section 8 tenant's attitude toward neighborliness and love for Lakewood. The issue is that if you rent to a group of single guys just out of college, or if you haven't called an applicant's previous landlord or stated place of employ, you're simply asking for problems. (I know, Jim, many absentee landlords don't go to these lengths. They simply want to get a lease signed.)

3) In my ten years as a homeowner and rental property owner in Lakewood, I've yet to understand how my city leaders routinely lament the fact that it has a thriving rental community. (There was some language in Mayor George's State 2005 of the City address which bent my eyebrow.) The fact that renters want to live in Lakewood is a good thing as long as landlords are obtaining a license, keeping up the estate and paying property taxes. Imagine the impact on local sales tax and related income tax revenue if Lakewood suddenly lost one-third of its current renters. It would have the same number of homes, just less population density. (Our water bills would go the way of Cleveland's - large increases due to the same water delivery infrastructure serving less people.) Why is being a rental community, among other great characteristics, such a bad thing? This city should be bending over backwards to support upstanding landlords, discipline bad landlords and attract tenants. Lakewood city officials, and all of us for that matter, should accept what we are as a community - in total.

Regarding Section 8 recipients, how many of us are six-months of paychecks or a disability away from needing assistance. "There but before the grace of God go I."


Everything is funny as long as it is happening to somebody else.
Will Rogers

[Jim O'Bryan]

David

Valid points all. I want to clarify at no point have we ever asked how they are paying, and I believe that refusing Section 8 checks that meet all the requirements. I am not sure, again as we have never asked.

The one woman that wondered if I would take three Section 8 checks to pay for our rental tore my heart out. All she wanted was for her child to grow up in the Lakewood School System. She was in tears. I actually found her another spot in Lakewood an today her son is in Junior High, she owns a business in Lakewood and is looking to buy in Lakewood.

But I still will side with the thought that too much of anything is not good. I think the burden on special services would bear this out.

As for the grace of god, amen Tom Wolfe's book "Ultra Chic" examines how 90% of the USA is but one bad moment away from dead broke.


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[Bill Call]

Since my phone calls have not been answered I have sent a certified letter to the person who runs the Housing Choice Voucher Program for CMHA.

I have asked for:

1.A copy of the Rent Reasonablness Study for the area that includes Cuyahoga County.
2.A list of single family, two family and three family homes that receive a subsidy under this program for Lakewood and Rocky River.
3.The amount of reasonable rent for each of those units.

If anyone out there has this information or any other information you can sent me a private message or post your information.

One man hour and counting.