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Saturday, March 28, 2020

Who is to blame for rent increases? Bellingham landlords speak on why student rental prices keep rising

A “For Rent” sign stands outside a house on North Garden Street. Hammer Properties owner Mike Hays said landlords can make more by renting to students. // Photo by Harrison Amelang

By Schuyler Shelloner

Framed by rugged mountaintops, with picturesque islands dotting its bay and craft breweries on practically every corner, it’s no wonder so many people want to move to Bellingham. But affordable homes have been in short supply and rentals are scarce, too. According to the U.S. Department of Housing and Urban Development, Bellingham’s apartment vacancy rate in 2017 was a mere 3.4 percent. According to rentalpropertyreporter.com, an online resource for landlords and property managers, a vacancy rate under 5 percent is great for landlords, but not so good for renters.

In an online survey conducted by The Western Front, large rent increases and maintenance issues were the main complaints made by the more than 40 people who responded. But for junior Nick Spevak, neither rents nor broken faucets were big concerns.

“A lot of my bad experiences here haven’t been the places themselves, it’s been trying to find a place,” he said.

Spevak said he had to pay approximately $70 for a non-refundable application fee for an apartment leased by Windermere Property Management. He said he never heard back from them about the place.

According to Taylor Assink, office manager at Windermere Property Management, Windermere charges a $40 application fee and a $25 co-signer fee when applicable, both of which are non-refundable. Since non-refundable fees for applications and co-signers are fairly common property management practices in Bellingham and elsewhere, finding rentals can be an expensive process.  

Spevak currently rents from a private landlord and pays $450 for a basement room in a house he shares with three roommates. He said it’s more affordable than the other apartments that he’s rented in Bellingham, but still much more expensive than anywhere else he’s lived.

“Even Pittsburgh, it’s like $400 for a studio apartment downtown, and it’s a pretty hip city now,” Spevak said. “Out here, it’s insanely expensive. This place isn’t as bad as Seattle, but I paid $880 for a studio apartment in downtown Bellingham. This isn’t Manhattan, this is a small town.”

Mike Hays, owner of Hammer Properties, said low vacancy rates are to blame for high rents. If supply is low and demand is high, rents will continue to climb. There’s little that can be done besides building more houses, Hays said.

Hays started Hammer Properties with the intention of renting to students, a good investment, he said, because many students receive help from their parents with living expenses. Most of the properties Hammer manages are in the Sehome neighborhood, close to Western. Hays said vacancy rates near campus are close to zero, lower than anywhere else in the city.

“We have families that are looking for houses, and we have students that are looking for houses,” Hays said. “The students, for the most part, will pay more than the families can. If it’s a six-bedroom house, you’re talking $3,000 a month. A family’s not gonna rent a house for $3,000. Students, the way they look at it, it’s just $500 for a room. As high as our rent prices are, it’s still cheaper than the dorms.”

According to the Western University Residences website, a standard single unshared room in a residence hall without a meal plan costs $8,725 this academic year, approximately $970 per month. A single unshared room in Birnam Wood costs approximately $840 per month, or $7,545 for the academic year without a meal plan.

Kurt Willis, associate director of University Services, said residence halls and campus-owned apartments come furnished, with utilities, internet, cable TV, laundry, toiletries, restroom custodial services, security patrols, safety escorts and other staffing included in the rent. He said Western’s campus housing does not require first and last month’s rent to be paid up front, and the $200 deposit is almost always returned in full. Students who stay the whole nine months may also stay over winter and spring break at no additional charge, Willis said.

Although it may be cheaper to find a room off campus, many of those interviewed for this article still complained about high rents. Students or renters aren’t the only people struggling to find affordable housing. Would-be homeowners also have a hard time finding affordable homes in Bellingham.

Executive Director Dean Fearing said in an email statement for a previous Front article that there’s a lack of starter homes for purchase in Bellingham, which are homes under $350,000. He said those individuals who would otherwise want to buy are forced to rent, which raises vacancy rates.

Local landlord, property investor and Western alumna Debbie Turk purchased her last investment house in the York neighborhood for $160,000 in 2010. According to Zillow, the median home value in the York neighborhood is currently just under $392,800.

While Turk isn’t looking to buy any more properties, she said she’s hanging on to her assets, which include ten rental units in downtown Bellingham.

Turk said she’s had to raise rents to cover rising insurance and utility costs, as well as the landlord licensing fee, but not more than a 5 percent increase per year.  When she can be sure she’s paid all her expenses, Turk doesn’t like to charge more than what she pays for her own mortgage, she said.

“We have incurred more expenses, but my approach, even though I know I could charge more rent, is it’s better to have good tenants who can afford to be there, instead of just having people filter through and beat on the place,” Turk said.

Turk also runs Blossom Management, a commercial property management company owned by former Mayor Ken Hertz. One of the companies the agency manages is called Workstudios, which offers commercial space for lease to local small businesses and startups.

Hertz said he does not raise rents for these spaces – he wants to help the small businesses that rent from him thrive. He isn’t motivated by profits.

“A landlord that only wants to maximize income and doesn’t give a rat’s diddle about anything else, they can double their rent,” Hertz said. “People don’t want to blame the landlord, but the landlord’s going to get as much out of it as possible. That’s the bottom line.”

14 COMMENTS

  1. Is this irony? Hammer Properties is actually a major part of the Sehome sleazeball problem! They rent out shitholes and should not be considered a reasonable voice in the discussion. EEwww…Sushi Housing on Forest St.? Most moldly, dilapidated housing in Sehome is Hammer managed. We’ve all heard the crappy Hammer stories… they totally suck and are best avoided when seeking stable housing in Bellingham.
    How did this get by the author of this article? maybe you are new to town?

  2. We are becoming more and more of a rent-seeking economy; in Amsterdam they passed a law that if you buy a house, you have to live in it. We need legislation to keep Wall St corporations like Questor and Blackstone from buying up Bellingham properties and pushing up the price. I doubt that city council members who own rentals would restrict corporate access, as they would have to question their own complicity. We need people to show up at the 7/14 city council hearing on mobile home parks to demand the jackals like Questor who just bought Samish Way Mobile Home Park not be allowed to raise the rents and cause homelessness. Blackstone, a British corporation, is building “student” housing around the country for profit. Wealth concentration is primarily a function of property ownership; this needs to be publicized, as we in the working class neighborhoods around WWU are being blamed for rising housing costs because we want single family zoning to keep out predators like Hammer.

  3. This should be illegal, period! People should have the right to affordable housing no matter where the home is located. I moved here for WWU and had 1 option for housing in July, a slummy apartment in the worst area in Bellingham for 1200 dollars a month, 1st month, last moth and 1200 deposit to move in. The place is nasty, carpets been here for years with previous tenants who fried food making everything sticky from grease carpets are now covered with runners as it wasnt livable. I have cleaned and cleaned and it is no use. The place is falling apart and the landlords took a month to fix a pipe for hot water to hook up our washer. There is electrical issues with the lights, flooring is caved in under linoleum in kitchen and at backdoor under carpet. We are 31 and 32 not new to renting but new to crooked landlords. What a shame for such a beautiful place to call home. We are now expecting our 1st child and we will be moving into a new place but for what cost, 1600, 1700, 1900, 2500 for a little duplex. Simply disgusting way to treat people and do business in this community. Something needs to be done to stop this!

    • Hello!
      My name is Jason James and I am a student at Western Washington University. I am writing a report on the demand for student housing and how it is affecting the housing market in Bellingham. I would like to ask you a couple questions for my story. It may never be published, but these articles are sometimes picked up for publication by local and regional news organizations. If you are interested in helping me please email me back!

      Jason James
      Jamesj28@wwu.edu

  4. Jonah, I completely agree with you. I myself working as a young parent who is attending school and working a full time job that pays just a dollar over minimim wage am flabbergasted at the housing scheme in Bellingham. I would like to point out the reality of most people who were not born with a silver spoon in their mouths, the hard working mothers, fathers, students, who are barely struggling to get by. The truth of it all is that Washington’s cost of living is outrageous compared to the wages given for many entry level or non experienced individuals as we all start off to be. Bob Oso, as you so mentioned, renting to students will leave an impact on rentals but for anyone deciding to go in that path should have already outweighed the pros and cons. Should you want more reliable renter funds by renting to students, one should keep in mind the consequences of such action and it is solemnly up to the landlord’s discretion. Also, it should be noted that damage and normal wear and tear is to be expected of any rental unit and stating that a certain group does any more or less based off age groups or anything else would be foolish. Argumentably, it all comes down to the quality of people a landlord is allowing to rent. There needs to be changes done to Bellingham all around and I believe once done, would be a ripple effect.

    • Hello!
      My name is Jason James and I am a student at Western Washington University. I am writing a report on the demand for student housing and how it is affecting the housing market in Bellingham. I would like to ask you a couple questions for my story. It may never be published, but these articles are sometimes picked up for publication by local and regional news organizations. If you are interested in helping me please contact me back!

      Jason James
      Jamesj28@wwu.edu
      253-293-0719

  5. Oops, forgot a 1 on the math above. After 4 years each individual student will have spent about $16,000 on rent. (This can be as much as $24,000 depending on the rate and lease). So the landlords make $64,000 just off of rent on a rat infested basement every 4 years per student. Figure they have multiple floors and properties, now with DADUs/ADUs on them too (you know like council members April Barker and Dan Hammill had illegally, until they voted in their own favor to make them legal recently), and each landlord can easily be making $128,000 to $256,000 per property on student rentals every 4 years. And they still can’t maintain them?! And we have no system to fine them with?! And we think our council members/mayor care about ethics, minorities, the poor, the homeless, etc. while they let this go on?! Time to wake up. Landlords in Bellingham are crooks being enabled by a corrupt government to steal from the bottom 90%. You know, like the baby-boomers always have. Steal from our grand kids and burn the Earth, is their business model. Sounds to me like it’s not the “noisy” students that are unappreciative, their landlords probably did the same when they were young after all, sound like the greedy landlords think they’re doing the students and families they are fleecing a favor and don’t appreciate their students, families, or community that overpays them every month.

  6. Greedy landlords are solely to blame for higher rents. They can choose not to rip everyone off if they want to. Remember Fiat currency, and the economy are ultimately made up concepts. High rents, property taxes, and housing prices also increase homelessness and need to balanced out by taxing the wealthy more. Which is fair. With that said, rent control and public housing would actually lead to a long term solution to the problem. If you don’t hear a mayoral candidate pushing for rent control and a lot more public housing, they are NOT a progressive and you should NOT vote for them!
    While the Bellingham Home Fund is a big step in the right direction, it falls short in key areas like helping homeless couples and especailly the 80% of homeless people that happen to be male. This is probably intentional as our mayor and most of the county and city council members are landlords.
    Oh, and Bob, considering how bad landlords are ripping off students on rents, while giving them slum apartments to live in, even if a landlord has to hire someone to do a few inexpensive drywall patches and replaces some carpet after a student rents from them for 4 years and pays them around 6 grand for it a crappy, broken down, basement apartment where they live like rats together with crappy infrastructure and overpriced utilities on top of it all, it’s obvious that the do nothings in Bellingham are at the top and are mostly landlords. Talk about a raging sense of entitlement from our landlords. Do you really believe that you have a right to not only rip off the students, but also tell them exactly how to live their lives on top of it? For most of our wealthy, entitled, landlords the answer is yes. (Remember, this includes most of your council members.) All of who need to pay more in taxes themselves before taking more from the poor and middle class in rent. Housing is, after all, a necessity.
    One final thing, most of the landlords that are bitching about “noisy kids” while taking their money, bought their homes at 1/8th of the price they are now in the not too distant past. They are simply stealing from the community. Not providing the benevolent services they think they are. WWU can help by building a lot more, good, apartment based, solar powered, student housing.
    Ask your upper echelon at WWU to fund it. With their obscene salaries, they can afford it. Or even better, why don’t we fine landlords for renting out broken properties and put that towards student housing.

  7. The hubris of these landlords is pathetic, to think that it is unavoidable or inevitable to have a market like this, that so strongly favors their interests, while making it impossible for families and working people to live. It should be illegal and seen as immoral for people to have so much while others have nothing.

  8. There is also a surge of people retiring in the Puget Sound area, along with a steady increase in the ability to work remotely. These factors are creating significant pressure on the Bellingham housing market. People that have worked their whole lives in the PS area want to be close to their life-long connections without living in the chaos of the Seattle area. We need to start talking about housing as a human right and remove the for-profit incentives to create shortages and limit individuals owning more than two houses in a single community.

    • Yeah. Remove the profit initiative and see how many houses and apartments get built. I take it you are not an economics student, that is for sure. THAT WILL NOT WORK. Plus, limiting how much a person can own? That’s never gonna happen. Not here, anyhow. What’s the next solution of yours? Maybe that someone has to stay where they were born forever and live with Mommy and Daddy until those folks die?

  9. Great article! Finding housing was difficult enough when I lived in town.. periodically I check the rent on an apartment I used to have in the Sehome area, and the rent has gone up about $300 in 4 years.

  10. Renting to young students who have NO idea how to care for property, do not want to do ANY maintenance on a place, are trashy and sloppy and noisy and have NO clue how to get along with neighbours might just be some of the other reasons that they have to pay so much. Rent for 8-9 months then spend 2 months worth of rent to FIX the place after ignorant and clueless kids screw the place up… well, you get what you ask for!

    • Guarantee you’ll get an idiot kid if their parent pays their rent and there’s no possible way they could afford it with their own work income. Try having some respect for your community.

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