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Summer 1997

New Laws...New Forms

Following each legislative session, new laws are passed and old rental forms become quickly outdated. One of the primary benefits of the Oregon Rental Housing Association is to provide you with forms that coincide with the new laws. This year, 25 forms needed to be revised due to the passage of our landlord tenant omnibus bill and others. Although revising the forms is no easy task, the forms committee has worked feverishly to provide every updated form on the day the new laws go into effect.

This year, the new laws take effect on October 4, ninety days after the end of session. Inside, on page 4 and 5, you can read about the forms changes. Much thanks to Sharon Fleming Barrett, ORHA Legislative Director and member of Oregon Apartment Association and Norton Cabell, ORHA President and member of Lane County ROA - for making it happen.

Now that the laws and the forms have changed, landlords need to know how to apply them in the most effective manner. Remember, we advocate law changes to help your business and we revise the forms to better serve your business.

Sharon Fleming-Barrett is holding seminars around the state to teach landlords how to effectively use the new forms. Don't miss it!
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President's Message
By Norton Cabell

Our various associations have something like 2,500 members. And each of us is very different. Some of us are young, some not; some natives, others from around the country and beyond; some of us are rich, others the opposite; we're obviously men and women and represent every race and probably most religions; lots of us own one unit, others thousands; some of us (I know for certain) are even Democrats. What unites us is that we are landlords - we own and manage rental real estate. So what should an organization that comprises 2,500 such disparate people - who happen to be landlords - do?

This issue of Oregon Rental Housing News focuses on one of our primary roles: education. Our reason for being - and this applies to both ORHA and our member associations - is to make our members smarter and better at what they do: being landlords. We do that in a number of ways.

Most obviously, with classes and workshops. Sharon is traveling hither and yon as I write, teaching landlords around the state the intricacies of the new law. Some four thousand landlords will be attending her workshops. Our new PRO certification program, with its variety of topics, is designed to educate each of us in every aspect of our business. As a teacher of the Fair Housing segment, I've heard more than once that such a workshop is teaching us more than we want to know. That may be, but it's never more than we need to know, and that's what makes the program so valuable.

Education comes in other, not so obvious, ways. Our Lawbook beats anything put out by any organization in the state; and while my opinion on that is obviously biased, it's an opinion that is widely shared. Leaf through and read some of it; see if you don't agree. Our forms are more than just a tool; they too are educational. Pick up Form 2-A (our best seller after the application form). As you read each paragraph you and your tenant are obligating yourselves to, you will learn what are the rights and responsibilities of both parties to the contract.

Education comes in our publications. As your president, I am privileged to read most of the newsletters from around the state. They are packed with useful information (much borrowed from one another, but that's part of why we join together).

And as I travel around the state visiting local associations, I find that our various meetings are primarily educational. We invite speakers to talk about subjects that we need to know more about. It's speakers that bring in attendance, that bring in members. Our state convention is built around top-notch, often national-stature speakers: more education.

We can do more, of course. One of my personal goals is to network more outside of Oregon, to reach out to others beyond our borders for even more expertise and knowledge. But there's plenty we can do right here at home. Our own 2,500 members are a font of practical tips and useful experience. Why, that might even include you. For sure, we can all learn from one another. That's part of our educational mission, part of what we as an association are all about.
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Around The State
Central OR ROA

A new way of reaching out to members, COROA had its first panel discussion a nnon in September. It is held the 3rd Thursday of each month at Abby's Pizza. Education is a priority! We plan to have 3 seminars this year. Sharon Fleming-Barrett will present 1997 Landlord/Law changes October 24th. This will be the first PRO Certification class in Bend.

Our monthly programs are hosted by one or two board members who arranges for speakers, room, etc. Prior to the meeting we have a half hour of networking.

Some of the tools we use to be a successful association are membership notebook (sold by ORHA), voice mail, post office box, a monthly professional newsletter, part-time staff person, form display at each meeting and educational handouts.

The Central OR Housing Authority sponsored a Affordable Home Fair and CORA has a booth. A community project is furnishing 5 lb fire extinguisher to the Habitat of Humanity houses. Membership is 195 members and 17 associate members.

The vacancy factor is high, 9.3%. Yes, more rental units are being built.

Landlord Tip: A MUST, Applicant screening that covers credit checks, FEDs and felonies. Also, remember to turn over any IOU's to ACBI collection agency (541) 726-6966.
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LANE CO. ROA

While vacancy rates in Eugene are higher than usual, they're lower than in most of the state, generally in the 3-4% range. For the first time in memory, there are vacancies in the U of O campus area, a result of much building and lower enrollment. Membership growth has been steady: we now have 440 members. The Association was less busy in the summer for the usual reasons, but we're now back on course. We ran in September our regular quarterly screening seminar (3 1/2 hours long) which is especially popular with new members.

We are expanding our booth in next month's home show; it's our single largest marketing effort and brings us numerous prospects and eventually members. We will be offering the three PRO courses in Eugene in January and February as we continue our focus on education.
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COLUMBIA CO. ROA

Our Christmas party is December 11th. Vacancy rate is very low. We have close to 50 members and are excited to report that we picked up 3 new members at the September Landlord/Tenant seminar by Sharon Fleming-Barrett.

Trial dates for FED's are being set out 6 months by judges in Columbia Co... Is there an attorney in our association that would like to donate or help us at a discount?

Landlord Tip: Screen, screen, screen! It might save you a trip to FED court.
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OAA

Signed up 1000th member! We plan on doing something nice for that person, but we are not sure yet what we will do. We are moving to a larger office, our new address and numbers are: 4110 NE 122nd, Ste. 101, Portland, OR 97230 Phone (503) 254-4723 Fax (503) 254-4821.

Landlord Tip: This tip is from Phyllis Kiefer: The landlord makes the rules and tenant follows them.
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NORTHEAST OR ROA

Greetings from Northeastern Oregon! We are cookin' along here with vacancy rates up and rental rates down. This not based on actual survey results, but just informal tabulations of what is happening with our members and inspection of the rental ads in the newspaper.

We have had again the pleasure of having Sharon Fleming-Barrett come and update us on the new changes in the landlord tenant law.

We are planning on having a speaker come from Walla Walla, WA to inform us on the new regulations of commercial units for environmental issues - we'll let you know what we learn.

Our membership is staying pretty constant. We are currently collecting dues for the new membership year and have instituted a $5.00 increase so all members can have a copy of the new member kit. Thank you membership committee for all your work - we like it! We have also used the new forms board and introduced those at our last meeting and had a great response.

Landlord tip from Northeast OR: Read the law and join your local Rental Owners Association to educate yourself.
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CLATSOP CO. ROA

Currently have about 52 members. 1998 membership drive starts in December - Free landlord/tenant law book for all 1998 members.

Next meeting on December 8th 6:30 p.m. dinner meeting at Golden Star Restaurant in Astoria.

Topic: Landlords & Drugs.

Accomplishments: Tabled the Seaside specified crime property measure that could fine landlords up to $700 a day and close property for up to one year.
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ORHA'S NEW 1997 LAWBOOK
It's bigger... and better...and essential.

The new lawbook has more than ten times as much explanatory material. In layman's language, the new Lawbook explains what the law means and how to comply with it.

Call your local Rental Owners Association.
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Ten Tips For Landlords
By Mark Kellenbeck

1. Never stop learning

Too soon grow old, too late grow wise. Unless, you work doubly hard to grow wise while your are still young. Invest in yourself. Learn all you can about your industry, your trade. Go to workshops, seminars, certification training. Listen to tapes, rub shoulders with those who are successful and ask their help. You can shave years off your learning curve just by being willing to ask questions. Years of frustration and years of lost opportunity. Share freely what you know and help others along their path to competency. Your continued education is no longer optional, it is a must both to survive and to succeed.
2. Build a strong support team

"No man is an island unto himself" could not be truer than in our profession. You need a support and expertise of many. Your real estate savvy CPA, your Landlord/ Tenant Law experienced attorney, your Fair Housing seasoned legal counsel, your ORHA form-literate secretary, your rental housing-wise insurance agent, and last but certainly not least, your landlord buddy golf partners. For all the knowledge and confidence that you will gain, you will never have it all and you will therefore always need the expertise and wise counsel of others.
3. Remember you are a business

The business of America is business. This means employees - yourself as an employee, payroll tax filings, quarterly estimates, record keeping, advertising, marketing, sales, planning, systems development and every other aspect of business that small and large companies alike must manage. And this means making a profit, if not now then some time in the not too distant future. If you are not making at least wages and not seeing equity growth, then it is time to re-evaluate. You have just so much time, energy and capital to invest, make sure the returns are there for you.
4. Make incremental improvements

A sure way to fail is to attempt too much at one time. This is true in every arena of life; take small chewable sized bites. Start with what is most important. Be realistic and be positive. Improve your resident population one resident at a time, starting with your next turn-over. Improve advertising starting with the next ad you write; experiment until you finally find what is best in today's market. Begin improvements at your property with flowers at the project sign, fresh paint at the entry way, small welcome gift for new residents. Develop a new resident packet. Don't wait to have it perfect before you begin and don't stop until you feel it's perfect.
5. Treat residents as valued customers

Is there really another way? Resident retention is key to any property's success. Turn-overs are expensive in all regards. Your property's reputation in the market place is one of its most valued assets. Make sure to the best of your ability that every current and past resident speaks well of you and your property. Simply put, treat people with the utmost respect. Be honest and care enough to be timely, to do good work, to be personable and take a genuine interest in your tenants.
6. Know the value of your asset

It is a serious mistake to under-sell the value of your rental property. Keep your rents at or very near market value at all time. Don't wait for others to tell you when to raise rents. If occupancy strengthens and vacancy thus declines, begin testing the market by raising rents on your next tenancy by $10 or more dollars per month. See what the market will support. If you fail to do this you not only diminish your own potential for profit, but you also weaken your immediate rental market adversely effecting other properties. Renters will never come to you and say, "by the way, you really need to raise my rent. I see your operating costs have risen and yours is one of the best kept properties in the area and I really want to see you get a fair shake." Do yourself a favor and don't give away your property. Over time, if you undervalue your property, you will be unable to keep it in the condition you once took pride in. More important, you will loose significant value at the time of sale; your property will be valued on its historical income stream.
7. Find satisfaction in doing it right

There are many frustrations in this business. However, they can be overcome by doing the right thing. You can't make everything perfect, eliminate all unpleasant situations, but you can do the right thing and have the satisfaction of knowing that you handled a matter fairly, professionally, caringly. Doing right greatly simplifies business and life. Yes, it can be costly when you made a mistake that has to be paid for, but it is best in the end. You gain self-confidence, you will feel good about yourself and your competency as a person and your good reputation grows.
8. Find a niche -know your market

You can not be all things to all people. Find a market niche, be it working-class families, young professionals, retired, elderly, college students, farm workers, etc. Many factors will influence your decision in this regard. They include your property's location, age, features, amenities, number of bedrooms, unit size, appearance, and your rental rates. It's the right combination of these factors that will determine how well your property competes and exactly how well it will perform over time. Know your property well and how it fits in the market, and know your competition. Compete on features, location, quality, your personal value as a caring and professional landlord and lastly, on price.
9. Have both short-term and a long-term perspectives

A clear vision of where you want to go, and what you want to accomplish is very important in this business and in life. But if your vision is too short-term you will become frustrated and give up much too soon. If your vision it too long-term you will become frustrated and give up or sell-out too soon as well. Find a balance that works for you. Sizable appreciation and that magic mortgage pay-off date are probably 15 to 20, maybe even 25 years away. Decide when it makes sense to farm-out some or all of the maintenance, hire a landscape maintenance company, bring in a property management company. Yes, you give up cash flow (maybe your wages) but you gain some hard-earned free time, a change of pace, maybe a change of scenery when you move off-site and settle into a home of your own with an unlisted phone number. However, in the meantime your rentals still appreciate and your mortgage balance still declines, and your cash flow begins to grow again. I imagine every successful landlord goes through those times when he/she wonders, "Did I do the right thing getting into this business?" It is only later that a landlord knows just how powerful real estate ownership can be.
10. Give back to your industry

Every landlord owes a portion of his time, energy and dollars to the industry he makes a living from or even a portion of his living from. Sitting on your local association's board of directors, a local or state rental housing committee, supporting pro-business/pro-landlord legislators are ways of doing just that. Each of us needs to do our part to see our industry continues to succeed. It does not happen on its own. Our collective efforts have kept rent control and real estate transfer taxes at bay, landlord/tenant law on an even keel, provided quality education to our members, and much more. Rest assured, any investment you make in your industry will bring you ample return on your investment.

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New Laws...New Forms
By J. Norton Cabell

As a result of 1997 legislative action, we changed over half of our forms. Some changes are just for purposes of clarity, others because the law changed. Here's a quick rundown of each form that changed.

Form 1. Application to Rent
Most of the changes just make this form more user-friendly, but we changed the screening fee disclosure section both for clarity and because of minor changes in state law.

Form 2, 2-A, and 2-B
The several rental agreement forms contain the most changes. Here's just a partial list: addition of "non-compliance fee" and "smoke detector tampering fee;" new language to allow pass-through of utility charges; adding language that allows you to post and mail all notices and the tenant to post and mail to you; requiring tenants to obtain insurance; making other forms an attachment to, and therefore part of, the rental agreement.

Form 4. 72-hour notice
The new form has room to write in the time the notice expires if it is hand delivered. On this form, as on many of the others, we printed the body of the notice in a larger type size, making it more obvious, and we printed smaller instructions for delivery and for completion of the form.

Form 5. No-cause notice of termination
We added post and mail language and also made the actual date of termination more explicit.

Form 6. Pet notice
We added post and mail language and, as with Form 5, made the actual date of termination more explicit.

Form 7. 10-day repeat violation notice
We added post and mail and language that refers to a previous for-cause notice, as now required by law.

Form 8. 24-hour notice
Another form changed in major ways. It's now a full page, not a half page. We changed most of the wording around what constitutes cause, because the law in this area changed.

Form 9. Condition report
We expanded the list to include bedrooms and added a 1-to-5 scale of "excellent" down to "poor" so that you can qualitatively assess the condition of each item. We also added space for the tenant, at departure time, to allow you to throw away anything that's left.

Form 12. Final accounting
This one, too, changed in major ways, because fees must be applied before deposits can be utilized. Also, because prepaid rent and last month's rent deposits need to be accounted for separately, we made that section very "separate." The form should be more understandable by both you and your ex-tenant.

Form 15. Tenant's 30-day termination notice
We added post and mail language. Getting these in writing is hard enough; imagine a tenant actually giving you two of them, one posted and one mailed.

Form 18. 24-hour notice of intent to enter
We made just a minor change, referring to "governmental agencies" instead of "city inspectors" to mirror the law.

Form 25. Abandoned property
Another major law change. You can now throw stuff away five days after handing this to the tenant or eight days after mailing it. The form includes other changes reflecting the total rewrite of 90.425; for example, specifically telling the tenant of your intent to throw the stuff away.

Form 28. One-time late payment
We made minor changes to make the form clearer, but nothing substantive.

Form 29. Partial payment agreement
This form, too, was reworded for clarity, but is not substantively changed.

Form 30. Deposit to hold
We added more details to fill in about the final rental agreement, for example fees and deposits required.

Form 33. Rules and regulations
We removed "will not be allowed to play in" which was begging a Fair Housing complaint.

Form 38. For-cause termination notice
Another major change. This one is now a full page, with plenty of room for you to spell out the details of the violation and also plenty of room to say how the tenant can remedy the default. Also, the form allows you to state that the violation cannot be remedied, if indeed that's the case. Of course, we added the post and mail option.

Form 39. 24-hour notice for holdover occupant
We clarified the time by which the occupant must vacate and added et al to catch un-named or unknown others.

Form 42. Applicant screening fee receipt
Since this is just a receipt, we removed a lot of surplus language, making it simpler, shorter, and briefer.

Form 43. Application denial
We added language required by Federal law that notifies an applicant of his right to dispute information reported by a credit bureau. We also added as a reason that we rented to someone else, so often the case.

Form 44. 144-hour notice
We clarified the time by which the rent must be paid, allowing for a time other than midnight when the form is hand delivered.

Form 46. Assistance animal agreement
We removed your option to charge a deposit for an animal. Sorry, but that's where judicial opinions have driven the law.

Form 48. Last month's rent deposit statement
You only use this form if you collected a last month's rent deposit and no security deposit. We added language on how it is served on the tenant, not a big change.

That's it. We worked hard to make these forms fit your needs. While they're newly printed, they're always in a state of revision. If you have suggestions on how we can make them more useful to you, let us know. And a new form is on its way: As yet unnumbered, it will be a Noncompliance Fee Notice, for billing your tenant (who has executed a new form 2, 2-A, or 2-B, which all allow a Noncompliance Fee) a fee for breaking your contract. Now is that progress?
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PRO Professional Rental Owner
Operator Certification Program

It has been a goal of Oregon Rental Housing Association (ORHA) for many years to recognize members who have educated and conducted themselves and their businesses in a professional way that maintained and raised the high ethical standards of the rental industry. There have been many educational opportunities offered in the past and the members of ORHA have received the benefit of that education. Now, it is our desire to collect, condense and organize these efforts into a structured program providing a comprehensive education of the laws and practices that govern the landlord - tenant relationship.

To this end, the Education Committee of ORHA has organized the Professional Rental Owner/Operator Certification Program. We have selected for the foundation of our program nine topics we believe are essential for the successful operation of rental property. Each of these topics will be presented as a full-day educational program taught by experienced and qualified instructors. Upon satisfactory completion of these programs, each participant will receive a certificate and badge.

Because we live in an ever changing society, we must change with it. We understand that the material in these programs will require modification from time to time with changes that occur in laws that develop through the years. New programs will be developed and PRO participants will be provided that information through the ORHA newsletter. To insure you continue to receive the latest information, you are encouraged to be a member of ORHA and enjoy the company of the PRO's.
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