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Section 8 --- A New Protected Class

By Jerry Bangerter

Services for Real Estate Pros with RE/MAX Kai Lani

July 16, 2008 08:22 AM

Well, the inevitable seems to be coming at us full speed ahead. A Brief of Amicus Curiae in Glenmont Hills Associates Privacy World at Glenmont Metro Center vs. Montgomery County, MD has been filed that will effectively make "source of income" a protected class and thus force landlords to participate in the Housing Choice Voucher Program (HCVP) which is often referred to as Section 8.

The National Association of Realtors (NAR) and National Apartment Association (NAA) had decided to write a brief on behalf of their members. Burning the midnight oil, the National Association of Residential Property Managers, NARPM constructed and filed a brief with the U.S. Supreme Court on June 2^nd, 2008. This is pretty much a first for NARPM as they increase their professionalism and involvement in major issues confronting the Property Management Industry.

Great work Guys! Keep it up. Jerry Bangerter, RE/MAX Kai Lani, Kailua, Hawaii, 96734 -- 808-237-5333.

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Diane Rice

Rice Prprty Mgmnt & Rlty, LLC, South Holland, IL - Lansing, IL

SFR, SRES, CNC

Jerry, we have all seen this coming haven't we? Landlords cannot be FORCED however, because the potential tenant still has to meet other MAIN qualifications, such as:

acceptable credit scores
rental history
previous housing inspection
affordability

The owners have to pay their mortgages and the majority of the approvals through the voucher program will not give the rental price asked for.

We do not purposefully SAY we cannot accept the vouchers, instead, we state that the program will not give us the amounts the owners need for their houses.

This post will be featured. I'm interested in hearing from others on this topic. Thanks for writing it.

Aug 09, 2008 12:56 AM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Diane, We have seen it coming and this is the first hurdle down for the old force business that government's and lucifer love so well. Actually, I have had good luck with the Section 8 tenants I have, but one has to use the tools you list very carefully in selecting qualified tenants who won't burn your rental down. Jerry

Aug 09, 2008 05:37 AM

Wallace S. Gibson, CPM

Gibson Management Group, Ltd. - Charlottesville, VA

LandlordWhisperer

J - NARPM had this stance many years ago and even had a position paper on it when I was Legislative Chair

Few states have source of income/Section 8 as a protected class and while it is good NARPM has taken a stance, it is hardly a "national" issue as it involves only a handfull of states or localities.

Maryland is a very liberal state * many government employees * and has pockets of rent-controlled areas. A few years ago, the legislature tried to make Wal-Mart pay for health insurance for all their employees since there were so many stores in the state. Wal-Mart choose to close stores instead, reduced the # of employees and the state suffered from the unemployment and loss of tax base. Wal-Mart re-located stores to NoVa and PA so customers could still shop and those store employees did not have to be covered by manditory health care.

Aug 09, 2008 09:31 AM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Wallace, I fully agree that this is NOT a national issue. Nor do I believe NARPM should weigh in on it as a national issue. But we all need to be heads-up as this kind of thing has a tendency to migrate from state to state. Hawaii is in big jeopardy.

Also, it would be foolish for NARPM Hawaii to weigh in locally on the issue at this time. Leave a sleeping dog lie, but one must be alert! I am holding my breath. Jerry

Aug 09, 2008 09:38 AM

Diane Rice

Rice Prprty Mgmnt & Rlty, LLC, South Holland, IL - Lansing, IL

SFR, SRES, CNC

Jerry, and i quote...

"but one has to use the tools you list very carefully in selecting qualified tenants who won't burn your rental down"

it THIS ever the truth!!!!

Aug 10, 2008 12:34 PM

Robert Machado

HomePointe Property Management, CRMC - Sacramento, CA

CPM MPM - Property Manager and Property Management

Hopefully the judges will not force a landlord to accept a tenant that comes with government strings attached that requires inspections and limited liability. It would not be good.

Aug 10, 2008 06:30 PM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Hi Dianne! One only has to be a nice guy once to remember another famous adage, "no good deed goes unpunished". Jerry

Aug 10, 2008 07:30 PM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Hi Robert; Count on the state making ever increasing incursions into the prerogatives of the owner until they hold all of the cards. At that time the rental will be public housing for the indigent for which the owner will be paid what the state wants to pay the owner. Socialism is such a fantastic system! Jerry

Aug 10, 2008 07:36 PM

Kealoha Garcia

Smith Valley Realty - Smith, NV

Investment Property and Management, Exchanges

Hi Jerry -

Beyond assuring other criteria are posted and strictly adhered to, there is not much else to do but accept it. One point is that anytime an isue is forced, liability transfers to the enforcers. Is there a different typ of Government regulated insurance on the horizon to cover this? It will be interesting to see what comes up, since there are many more of these types of tenants on the horizon.

Thanks-

Aug 13, 2008 08:08 AM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Hi Kealoha, This issue is of grave concern to me. You raise a couple of points we all need to think about. We WILL need some type of coverage to put the homes back together when we are no longer able to be selective in tenant assignments. Jerry

Aug 13, 2008 08:24 AM

Trey Thurmond

BCR Realtors - College Station, TX

College Station , Texas Homes

Gosh! This is all very interesting. I didn't realize this was happening. Thanks for telling us.

Aug 13, 2008 02:48 PM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Thloop! I couldn't understand you with your tongue so tightly pressed against your cheek! Then I remembered, you're from TEXAS! Aloha, Jerry

Aug 14, 2008 05:59 AM

Marissa Louie

San Francisco, CA

jerry - i agree, section 8 is already riddled with problems. in any case, great content! stay in touch here and at www.marissalouie.com

Aug 15, 2008 04:33 PM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Marissa, Glad to know that you are on board resisting further encroachments in the domain of private land ownership. Hang in there and congratulations on a great site. Jerry

Aug 15, 2008 04:45 PM

Randy L. Prothero

eXp Realty - Hollister, MO

Missouri REALTOR, (808) 384-5645

No discriminating for the source of money? How about if it is from illegal activity?

I am hopingyou will still be able to discriminate for poor credit history. When they take that away, the rental market will take on the same mess and the sub prime mortgage market.

Oct 08, 2008 01:07 PM

Golden Estate Management

Golden Estate Property Management - Los Angeles, CA

Jerry I definitely agree. Thank you for sharing that with all of us!

Dec 09, 2008 08:27 AM

Jerry Bangerter

RE/MAX Kai Lani - Honolulu, HI

Ah, ha, glad to see that you and I are reading from the same sheet of music. We will need to be very careful about this one. Jerry

Dec 09, 2008 09:49 AM