Landlord Blues

New York Times, May 22, 1997

Like most landlords in New York City, I take pride in my apartment buildings. I do my best to keep up with maintenance. Unfortunately, each year my operating expenses increase more than my income.

My three buildings in Bensonhurst and Flatbush in Brooklyn are a mix of rent-controlled and rent-stabilized apartments. But I don't think that rent decontrol will be the answer to my problems. As a recent study by the Rent Stabilization Association documents, the only neighborhoods where rent-stabilized apartments are not near market value are in Manhattan. So radically increasing rents would backfire on most landlords: Many tenants would leave their apartments or fall behind on their rent.

There are better ways to help all of New York's landlords -- not just the few in the richest parts of the city. Politicians in Albany should work with the groups representing the landlords and tenants to forge a different compromise. We could keep some type of rent control and at the same time reform the system to keep operating expenses down. Here are some critical changes that should be made:

Make eviction easier. The courts that decide landlord-tenant disputes are one-sided. Landlords are assumed to have very deep pockets. How dare I evict a tenant? Judges routinely grant a 45- to 60-day grace period to tenants behind in their rents.

Eviction is something that happens only after months of making court appearances and paying lawyers' fees.

One of my tenants, a woman in her 40's, stopped paying rent last August. She asked the judge several times for grace periods. I had to go to court at least five times before the judge issued an eviction order in March. I spent $910 in legal and other costs to evict her -- not to mention losing nearly $4,000 in back rent.

Decrease real estate taxes. In 1984, I paid $11,157 in real estate taxes for one of my apartment buildings. Since then, this building has been reassessed at ever-higher rates. I now pay $53,672 in taxes a year, almost five times the original assessment. My building could not be worth five times what I paid for it. In that period my total rental income for that building only doubled. (If there were no rent control and I had quintupled the rents, my tenants would simply have moved out, and I wouldn't have found new ones to pay the higher rates.)

Like thousands of other landlords, I have asked that my assessment be adjusted. But we all wait years to settle our cases with the city's Department of Finance. I have finally settled my 1989 tax bill; I'm still waiting for an adjustment to my real estate taxes for every year since.

Help landlords reduce their insurance bills. The city and state love to pass laws mandating what landlords must do to safeguard their buildings. Yet it is virtually impossible to get insurance for much of what they have made us liable for. Insurers don't usually cover environmental hazards, specifically lead paint exposure. Yet in New York City, landlords are responsible for any exposed lead paint in their buildings. Some wealthy landlords can afford to purchase separate policies at exorbitant costs, but most of us can't.

Rent control? That's the least of my problems. Why not tackle the real problems of landlords -- overregulation, bureaucracy and high taxes? Then maybe the rent regulation debate wouldn't be such a lightning rod.

Vincent Ragosta is a landlord in Brooklyn.