Study: 40% of landlords selling or sold Seattle properties because of new rental rules
SEATTLE - William Shadbolt shows off his newly remodeled Belltown studio he owns and has rented for $1,195 a month.
But, he has decided to sell it, not because he no longer wants to be a landlord, it's that he no longer likes being a landlord in Seattle.
“After all the different ordinances the City has passed, it just wasn't worth renting out property in the City of Seattle,” said Shadbolt. “We are just about to list it for sale for just under $300,000.”
It’s a price few renters could afford to pay and that’s why they rent. It’s also one less rental property available in a tight rental market.
But for Shadbolt, who is also President of the Board of Directors for the Rental Housing Association, it came down to policies the Seattle City Council enacted beginning in 2016 - such as restricting the size of security deposits.
“We have in the past cut breaks with people who have had eviction records on their background check and we asked for a slightly higher security deposit,” said Shadbolt. “Now the city limits what the security deposit is."
He said his lease agreement is now five pages long for his properties in Seattle, versus two pages for places outside the city. The new laws put several restrictions on landlords like Shadbolt who said he feels demonized by the city.
“The level of risk is increased by the city council actions, so people like myself are selling," he said.
And he’s not alone.
A just-completed study by researchers at the University of Washington, paid for by the City of Seattle found 40 percent of landlords survey indicated they have sold or will be selling rental properties in the city because of the new rental restrictions.
Landlords also cited the new laws as being ineffective toward making Seattle more affordable. The survey also found 89 percent of landlords believe landlord perspectives are not being considered by policy makers.
The survey found differences in practices between landlords of 20 units or less, than the larger management companies representing large corporate ownership.
Larger units tend to have larger rent increases and are likely to report increasing taxes as the reason for rent hikes.
Renters surveyed for the report found the most significant barriers to housing are cost and affordability, the lack of transparency in application or leasing process, discrimination and almost no familiarity with the city’s rental laws and skepticism of the effectiveness of those laws.
Meanwhile, real estate website Zillow has found rental prices in Seattle still very high but flattening out.
“Data from May and June of this year see rents dip in the city,” said Aaron Terrazas, Senior Economist at Zillow.
“This has happened in other major cities in New York, Washington, D.C. and San Francisco in the past few years and its finally catching up to Seattle,” said Terrazas.
In its own analysis, Zillow discovered rents are substantially cheaper for people willing to drive 15 minutes outside of Seattle’s downtown core.
“Rainier Valley, south, from like Columbia City down to Kent - those areas tend to have the biggest bang for your buck,” said Terrazas. "Places north of Seattle, Mercer Island, Issaquah and Ballard have the ‘least bang for your buck."
The City Council’s Human Services, Equitable Development and Renter’s Rights Committee heard from the study’s researchers on Tuesday, but it was strictly in an advisory role, no committee action was taken.