With no choice, they sold the house in September. Another little landlord is gone.
“My parents really had no choice,” said Erika, 37. “They can’t pay their mortgage when they retire without rent and no one can turn to for financial help. It’s sad – we have memories in that place.”
It’s been a rough few years for small landlords like the Patinos, who have been hit after hit since COVID began. Since the end of pandemic-era rental assistance and unemployment programs last year, many tenants have lost their jobs and been unable to pay rent. Now inflation is taking its toll, leading to ever-increasing costs for maintenance and utilities.
In the state’s lagging housing market, what should have been a lifeline has become an economic burden.
“Some landlords in this state — especially our mom-and-pop landlords — are finding that their properties are no longer recovering their costs, or they are actually losing money,” said Doug Quattrochi, the association’s executive director . Trade Association MassLandlords. “To me, it shows that a system doesn’t work for anyone.”
and struggle Or small landlords could have broader implications for the region’s increasingly stratified housing market.
them Owning nearly half of the rental properties in Massachusetts, typically older and smaller buildings, naturally command lower rents than large new apartment complexes built by big developers. In many cases, these landlords live in or near their buildings and also consider their tenants to be their neighbors.
A study published last year in the journal Social Power looked at eviction filings in the greater Boston area and found that large landlords (defined as entities or individuals with 15 or more units) filed for evictions more often than small landlords or homeowners Two to three times as many people have fewer than four units.
“Mom and pop landlords are the real blood of the entire real estate economy because they represent stability and affordability for tenants,” said Melvin Vieira Jr., president of the Greater Boston Association of Realtors. It’s much less likely to be good than an anonymous owner you’ve never met.”
Meanwhile, smaller landlords are often much less profitable than landlords with more properties and fewer reserves. So all it takes is a single tenant not paying rent for a few months to tip their financial scale in the wrong direction.
In part, pandemic relief, including the Paycheck Protection Program and the massive expansion of state rent relief efforts, have helped offset the eviction moratorium and the wave of pandemic layoffs. But when these shows ended, they left renters scrambling.
As Quattroach, who owns and lives in a three-story double-decker in Worcester, puts it: “When tenants struggle, their landlords struggle too.”
The job market is stronger now. But this year, inflation has become a growing problem for renters and tenants alike.
Take Beatriz Yañez Placencia, who with her husband owns a three-story car in East Boston. Her tenants — all of her close family — have lost their jobs during the pandemic, and rising costs for groceries have meant they’re paying less and less of their negotiated rent.
That, in turn, is hitting Placencia; both she and her husband are temporarily out of work due to medical issues and have had to borrow money from friends to pay their mortgages.
“We’re really struggling,” she said in Spanish through a translator. “I don’t know what we’ll do.”
Placencia said one thing she won’t do is file for deportation other than against someone she considers a friend.
Monique Aziza, a staff attorney with the Volunteer Lawyers Project, which represents low-income landlords in eviction lawsuits, said she has almost never encountered landlords who evict tenants for less extreme crimes.
“Eviction is expensive, it’s complicated, and it’s painful for everyone involved, especially when you know someone who is on the other side of the lawsuit,” Aziza said. “This is not something that those we represent take lightly.”
Housing advocates are growing concerned about the struggles of these small landlords, fearing that mounting pressure could eventually lead them to sell to new owners who may charge higher fees. They point to Sun Belt cities like Tampa and Phoenix, which saw a wave of corporate investment in residential properties earlier this year when their real estate markets were on fire.
In Massachusetts, that doesn’t appear to be the case, but data on corporate residential property ownership is scarce, and the state doesn’t track them publicly.
Thomas Shihadeh, Boston area manager of commercial real estate firm Marcus & Millichap, said there has been an increase in small landlords selling properties this year, despite the diversity of buyers.
Advocates say they are seeing a smaller trend. In East Boston, for example, Steve Meacham, organizational director of the tenant advocacy group City Life/Vida Urbana, said mom-and-pop owners he spoke with said they often received inquiries from people seeking to buy their buildings. Company flyers and announcements.
“[Small landlords] Against it because of the loss of revenue and price increases during the pandemic, but also because they will get a gain when they sell,” Meacham said. “It’s a symptom of a dysfunctional market [selling] become more attractive. “
His group is part of a growing movement to acquire occupied properties from private sellers and rent out the units as deed-restricted affordable housing, an effort they hope will stop Some properties fell into the hands of large corporations. Under the leadership of Mayor Martin J. Walsh and current Mayor Michelle Wu, city housing officials have poured millions of dollars into a city program to help fund these deals.
For small landlords, the choice between staying or selling is complicated. Placencia said she wouldn’t consider selling her home because it’s more stable than renting, which she fears will eventually drive her out of Boston.
But for the Patinos, their fortunes have become difficult to hold. Regardless, they plan to sell it sometime in the future. The sale closed in September for $760,000, according to Suffolk County property records, and they used the profits to move back to Columbia, where they immigrated in the 1980s, where the cost of living is much lower. The home was owned by an individual buyer, and county real estate records show the new owner lived there, their daughter said.
“I always told my dad, ‘You made the American dream come true. You started from nothing, you bought a house, you educated your kids, and now you’re going back to your country,'” Erica said. “I wish it had happened differently – maybe we could have kept the house somehow – but at least they got out of that.”
Andrew Brinker can be reached at email@example.com.Follow him on Twitter @andrewnbrinker.