As a real estate investor in Baltimore (we have 1 rental property), I am appalled at the irresponsibility of these landlords! I think there are too many investors out there looking for more of a tax break then actually looking at establishing decent rental homes for tenants. The rent monies we receive from our tenant always goes toward the mortgage and any repairs our tenant needs. The city should cap the limit on the number of properties investors should be allowed to own in the city.

Thanks, Jamie. Renters who are not being given the 90-day notice to which they are entitled may also contact the Consumer Protection Division of the Maryland Attorney General's office for assistance by calling (410) 528-8662 or filing a complaint at www.oag.state.md.us. The Division also has a consumer education piece regarding the issue on the Consumer Tips & Publications page of the website.

excellent post Anonymous

The National Low Income Housing Coalition has a toolkit for tenants facing eviction, and you can download it from their website: http://www.nlihc.org/template/page.cfm?id=227

Thanks for the link, Baltimore Slumlord Watch, and thanks to Steve Sakamoto-Wengel for the contact information.

"The city should cap the limit on the number of properties investors should be allowed to own in the city."

Why?

This law was created as a "self-regulating" law meaning no government agency enforces it (like for example HUD enforces RESPA laws). It is up to advocates, lawyers, judges, tenants and lenders to fight it out.

This law has loopholes big enough to drive a truck through that can be used to keep even an owner in. If you're an owner, simply find a tenant, perhaps a friend who is sympathetic to your situation and have them sign a lease. The law requires it be a "bona fide lease," meaning it can't be to immediate family, and it can't be "substantially below market" (it can be below market, just not substantially below, think 60-70 cents on the dollar). For those who don't have a sympathetic friend willing to sign a lease I'd be curious to see how/if this law applies to someone who is only renting a room, because if you can keep part of the house from the bank, you're effectively keeping all of the house from the bank.

As for piercing this protection by selling to someone who actually wants to live in the property, that is very unlikely to happen as you can't get any type of traditional financing without gaining access to the property for a full appraisal with an interior inspection and as long as the owner or tenant denies access, the property isn't selling to anyone but the bank or maybe an all cash investor.

Interesting points, Josh.

This issue, along with the story in today's paper about getting money to the non-profits to buy foreclosed properties only scratches the surface of a huge problem forecast to get bigger--perhaps it should be called the foreclosure bubble! Foreclosures are continuing at imploding rates. Government intervention has failed to facilitate sustainable loan modifications to allow qualified homeowners to stay in the home. Money is going to non-profits to pick up the pieces-i.e., buy the foreclosed homes. The same non-profits that are trying to help people stay in their homes are competing with investors to buy the homes that are being foreclosed on. Almost 40% of the foreclosures were to renter occupied properties-that is a lot of investors going into foreclosure. While I do not support the comment that "The city should cap the limit on the number of properties investors should be allowed to own", I think there should be a registration requirement for real estate investors. Too often, investors hide behind LLC's, use phony mailbox addresses, and otherwise conceal their identity. These folks are the ones competing with legitimate and regulated non-profits, and these are the unregulated investors posting those pesky & illegal "We Buy House" signs, that compete with the regulated and licensed real estate agents/brokers.
Robert J. Strupp
Director of Research and Policy
Community Law Center
roberts@communitylaw.org
www.communitylaw.org

When I mentioned "The city should cap the limit on the number of properties investors should be allowed to own in the city", I was thinking that this would be a way for the city to easier regulate and control landlord investments. Any property that is owned and rented in the city is required to be registered already. There are investors out there that do change their LLC's or get additional LLC's in order to increase their investments. Possibly, there needs to be new legislation to control investor LLC's. This may help ease foreclosure rates if the LLC's are limited in their purchases.

I'm glad to have read the article from Dec 30th. It does hit home. My daughter rented a home in the Patterson PK area of the city. On several occasions the owner has used a key and entered the house. The owner made comments about finding food still on the stove and the up kept of the house. However, she was told to clean for lead paint removal. The lead paint dust particles were every where. One time my daughter came home and found her door wide open with the workers hired by the owner down in the basement. My daughter can't keep leaving her hob for this problem. What kind of help can I get for my daughter. A. Mitchell

One of the slumlords we write about often controls well over 100 LLC shell companies. Because of his unethical business practices and those of his peers, we wholeheartedly support legislation to tighten the controls on LLCs.

I am old enough to remember the LLC/real estate fiasco of the 80s. In fact, one of the biggest scandals in my hometown centered around a guy who owned a now-huge development corporation (and still owns today) -- he also owned one of the local banks, which he drained in order to shore up the bottom line of his LLCs. He was no better than Bernie Madoff, but on a smaller scale.

Amelia, I'm not sure if I'm following the full extent of the situation. Has the landlord lost the property to foreclosure but keeps coming around to make demands on your daughter? Is foreclosure or pending foreclosure part of the situation, in other words?

If not, and the problem is that the landlord keeps coming in without asking, making demands your daughter finds unreasonable and doing work without alerting her, she might call Baltimore Neighborhoods Inc. (see the link in the post above) to find out what her legal rights are.

I am a landlord and resident in the city. I agree there needs to be some regulation to curb this problem. What I have realized is far too many people got into the market because it was the "in vogue" thing to do. Now with banks tightening, fees going up, and rents going down there are individuals who find themselves stuck. There was a time (back in '04-'05) where I bought an investment property in a location and then when I went to buy the house next door to it someone out bid me by $25,000. Now needless to say that house has a for sale sign on it. I was told that I was too conservative during those times. Who has the smile on their face now? The flip side is, it has been difficult to buy an investment property that is the result of a foreclosure. The time it takes to get the bank to let go of a foreclosure is crazy. "Rich DAD" didn't teach me about this!!!!