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South Bay landlord agrees to stop making tenants who might get state subsidies pay a fee out of their own pockets
By adamg on Thu, 06/01/2023 - 5:04pm
The state Attorney General's office says the owner and manager of a complex on Lucy Street in Dorchester will no longer make tenants with Section 8 and state rental vouchers pay a $500 upfront fee out of their own pocket just to get an apartment there.
In a filing in Suffolk Superior Court today, the AG's office said the owners and managers of the Andi South Bay at 4 Lucy St. were charging people who might be eligible for state subsidies to pay a $500 "first month's rent deposit" even before their subsidies were calculated, which means the fee might exceed what they would actually have to pay in rent each month, in violation of state law.
PSP Partners of Chicago, which owns the building, and Graystar, which manages the 475-unit complex, agreed to basically knock it off and to pay $20,000 towards the cost of the state investigation and for possible restitution to any affected tenants.
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Comments
the sheer moxy of this is incredible
It wasn't long ago that the state supreme court laid down the banhammer like Thor and declared that ANY fee of ANY kind aside from first/last/security and a key fee were illegal, and security cannot exceed one month's rent.
The move was, to put it mildly, well covered by the press and in property management circles. These people were very, very intentionally violating the law and I don't know why the AG is letting them skate by with a "we won't do it again".
The rich upper class protecting the rich upper class, I guess. Our state AG seems to have little interest in repercussions for the powerful fucking over poor people.
Not just the upper class.
The out of sight 0.1% class. According to Google, "Penny Pritzker is the founder and Chairman of PSP Partners and its affiliates, Pritzker Realty Group, PSP Capital and PSP Growth."
haha, oh wow
> Penny Sue Pritzker is an American billionaire businesswoman and civic leader who served as the 38th United States secretary of commerce in the Obama administration from 2013 to 2017
Wow.
Also apparently her family made its billions off the Hilton hotels.
Brother J.B. is governor of Illinois
- - co-chair of the 2008 Hillary Clinton campaign. Mentioned as possible presidential candidate.
Family are big funders of culture war issues on the liberal side.
Good examples of how the rich say "Hey look over there!" whilst picking your pocket.
Disgraceful appointment by Obama
and I voted for him. Twice.
Don'tcha know?
Out of state companies don't have to follow MA rules.
At least that is what one big apartment company told my son. (yes, that got reported - by the realtor)
sounds like
you might be surprised to learn how many landlords are violating the law on a regular basis. (it's most of them)
This is encouraging to know
This is encouraging to know that not all government is clueless and asleep at the wheel (and it ain't no self driving motor vehicle). Keep up the good work with exposing the unfair but VERY active practices of property owner landlords with big city lawyers who claim they are on board and "inclusionary" with 40b.
Everyone else
has to pay first month, last month, security deposit and realtor’s fee. $500 seems like a bargain.
unless..
that $500 is in addition to first/last/deposit
The post says it’s a “first
The post says it’s a “first month’s rent deposit”.
So is there clear guidance on what landlords are supposed to do? Is it up to the tenant to assert that they’re applying for a Section 8 subsidy which has not been calculated yet? Or does the landlord have to ask or assume? Do they need to provide proof? What would the first month rent deposit be if the tenant’s portion of the rent is not known? If landlords are supposed to use a reduced amount, or charge no first month rent in advance, the state should publicize the rules.
Indeed ...
"everyone" does pay those fees when opening a lease; however, the article clearly points out that this practice means that some people were being placed in the position of paying more than that. Adam puts this writing together well - a real service to the community - so maybe spend a little effort in the reading (unless you're deliberately providing your own disinformation twist to this story out of racism, classism, or whatever, in which case there's probably no helping you).
S.E.
Everyone else
Read the article which says that this was an additional fee.
I guess I shouldn't expect reading comprehension from an anon
these people were getting charged an additional fee on top of those, and also the broker's fee scam should be illegal.
Dirtbag landlords.
Exploiting the poor. What else is new.
You realize it goes a little
You realize it goes a little more systemically deeper than that. Those mandatory Inclusuonary Housing Covenants that Gov't housing requires banks' and title insurance companies ' lawyers for subsidized housing owners are a joke with no legal teeth. Just spend a day at housing court where Boston's mover and shaker landlords (we won't mention entities) are the "Defendant" .
Can’t wait for Lee’s take on this
It’s going to be juicy
What do you think he'll say?
Hmmm
lol
I’ll probably just say, “Hiya, robubeleh”
Not Lee but
here's a take. Section 8 tenants can be more headache than they're worth for landlords. Uhub posters may believe that they're all earnest, honest, hardworking tenants beaten down by a systemically racist system lacking in equity and social justice. The actual experience of many landlords is that Section 8 tenants are risky and likely to demonstrate bad behavior.
The actual experience of many tenants ….
…. is that landlords are likely to demonstrate bad behavior and get away with it.
I hate to do this to you, Adam
But you left a word out of the headline.
As for the substance, I can see why the landlord wants a deposit, but according to the program, wouldn't some of the deposit be paid by the BHA or whoever runs the Section 8 program?
Omitted word added
Thanks!
As for your question, there are two answers listed in the filing, apologies for not putting them in the story.
One is that in some cases, tenants would be paying less than $500 a month in rent when you add in the subsidy, so they wound up paying more initially than "first month's rent."
The other is that, in at least one case, a tenant made just that argument, that she should be able to pay the first month's rent with the money she'd be getting from the state and she was told no, her rental application wouldn't be processed until she paid $500 up front, before she got anything from the state.
Chicago investors?
Housing subsidies like Section 8 are a gold mine fir the Hedgefund Industry. They're also buying up vast amounts of housing, including single homes, from coast to coast. And their goal is to rent them. Are they monitizing the "poor" and lower income people at huge taxpayer expense? Absolutely. Are they providing a much needed service? Yes. Is it a dirtbag shifty industry? Absolutely.
Maybe people complaining should spend more energy combating ridiculous municipal zoning, including snob zoning. Good luck. The Real Estate Industry owns politicians at local, state & federal level. They are one of the top 5 DC lobbyists year after year, along with the Healthcare Industry, Pharmaceutical Industry, High Ed, and $ Teacher's Pension Funds $. $ talks.
MGL Ch. 186 Section 15B
Limits a landlord to charging only the following up front: First month's rent, last month's rent, a security deposit not to exceed an amount equal to one month's rent (which must be kept in an interest bearing Massachusetts chartered bank, and the interest must be paid to the tenant on an annual basis), and the actual cost for a key/lock change. Nothing more. Landlords may not charge things like cleaning fees, move-in/elevator fees -if a condo building where a unit is being rented has a moving fee, that must paid by the unit owner-, pet rent(*), pet deposits that when added to the security deposit exceed one month's rent, involuntary amenity fees, application fees(**) or any costs related to screening potential tenants, late rent fees charged before 30 days of delinquency. Any violations of the statute can be costly to a landlord, tenants who sue to recover may be entitled to damages equal to three times of whatever was illegally charged. More info here.
*In one case the federal court allowed pet rent, but only after the tenancy was commenced. It's not quite settled law, so cautious landlords probably should avoid it.
** Licensed real estate salespersons can charge an application/screening fee to prospective tenants, but that is per client, and not tied to a particular listing. It's a gray area as to whether that should come out of the broker's fee, but with the way case law has been trending, it's probably good practice to include the costs of doing that as part of the broker's fee.
So pet deposits aren't legal?
My tenants have 2 dogs ( beegle mix and a silver lab) and 2 cats in a 2 bedroom apartment that's 700 sf in a 2 family I own. I'm charging a $400 pet deposit on a $1,300 ( slightly below market rate) a monthly rent to encourage them to keep the dogs under control and offset a little of the potential damage from the animals. Many landlords will not allow pets. This seems to be a potential part of the law that would likely prevent tenants from having pets to me?
interesting question
I'd say a pet deposit is legal, because you have the right to exclude pets altogether.
You are negotiating on an issue outside the scope of ch. 186 or other law afaik. You are giving up a right, they are providing a security.
There is a bill pending to prevent housing discrimination against pets, but it is linked to the pandemic state of emergency and of limited scope. Seems to only apply to hotels and public housing.
Discrimination against pets?
Wtf?! That’s about as dumb as the changes to 62F the house just approved where the excess is evenly distributed.
Pet deposits are legal until they're not legal
If you're renting a place for $1,300 and you require a $650 security deposit, you may add a pet deposit of up to $650 to the security deposit if you want (and it must all be kept in an interest bearing account in a Massachusetts chartered bank, with interest returned to the tenant once per year). If you're asking the tenants to put in $1,300 as a deposit, you may not add an additional deposit, no matter what it's for. Under no circumstances may a landlord require deposits that exceeds an amount equal to one month's rent, regardless of what it's for. If the total deposit does not exceed $1,300, you're in the clear. If it does exceed $1,300, you could be liable for 3x the amount of the full deposit, even if the tenants agreed to it because unenforceable clauses (per the statute: “Any provision of a lease which conflicts with any provision of this section and any waiver by a tenant or prospective tenant of any provision of this section shall be deemed to be against public policy and therefore void and unenforceable.”) in leases are just that, unenforceable, and the courts have taken a very narrow interpretation of the statute, that it only authorizes what it states and nothing more.