STATESMAN IN-DEPTH RENTAL HOUSING

Expendable tenants

Booming rental market makes it easier for neglectful landlords to ignore substandard living conditions

By Dave Harmon and Eric Dexheimer DHARMON@STATESMAN.COM | EDEXHEIMER@STATESMAN.COM

When Keith and Janie Wiley moved into their new apartment on Rutland Drive last year, they got a surprise when they opened the refrigerator, they said. It was crawling with roaches. Then they discovered the bedbugs.

In Northwest Hills, Tabitha Smith said her new apartment in the Oak Hollow complex had a broken dishwasher, a fridge that couldn’t keep food cold and a utility closet caked in mold from a leaking air conditioner. Then it flooded from a plumbing leak.

The Wileys and Smith asked their apartment managers to fix the problems, but said repairs took weeks or months, if they happened at all. The Wileys soon got an eviction notice and fought their landlord in court. Smith sued Oak Hollow, claiming the complex failed to address what she calls deplorable living conditions. (The apartment management company says it ad-

dressed Smith’s complaints and plan to countersue her.)

Stories like theirs have become increasingly common in Austin, where a sizzling economy has been beneficial for landlords, but far less so for some tenants — especially those of modest means. In a city where more than half the population rents, tenant rights groups say the laws of supply and demand have tilted the playing field dramatically in favor of landlords, who face little in the way of repercussions for ignoring substandard living conditions in their buildings.

Tenant advocates say the vast majority of Austin’s landlords act responsibly, making needed repairs and treating their tenants fairly. But a wide range of involved parties — City Council members, city Code Compliance officials, tenant advocates and real estate industry groups — agree that Austin’s real estate boom has made it possible for a subset of “bad actors” among rental property owners to ignore substandard conditions and tenants’ complaints.

One indicator of the scope of the problem — code complaints and violations at rental properties — has exploded in recent years. Between 2009 and 2012, complaints have nearly tripled and code violation notices have quadrupled at 126 rental properties considered repeat offenders (meaning they’ve received at least two code violation notices during that period). Among the 565 apartment complexes with 50 units or more, Code Compliance data show that 68, or 12 percent, are repeat offenders and that together they’ve racked up more than 700 violations since 2011.

But those numbers only describe part of the problem. Rather than responding to tenant complaints by fixing problems, some landlords replace the tenant — which is easier to do in a city where occupancy rates hover above 95 percent. Kathy Stark, executive director of the Austin Tenants’ Council — which aids tenants in disputes with landlords — said she often sees renters lose apartments after complaining to managers or the city about poor living conditions.

Under Texas law, retaliatory evictions are illegal. However, Stark said, landlords simply can retaliate by not renewing the lease of a tenant they view as a troublemaker. “From their point of view, there’s one less complainer,” she said, “and they have three other tenants lining up to rent the place.”

The problem is especially acute in rapidly gentrifying areas of central East and South Austin, where a shrinking supply of affordable housing choices has meant that renters who lose their apartments stand little chance of finding another place in the same area at comparable prices. As a result, advocates say, unsafe living conditions are underreported because many low-income renters have learned to keep their complaints about moldy bathrooms, vermin infestations and failing fixtures to themselves.

“To complain is to risk retaliatory eviction or rent increases,” said John Henneberger, co-executive director of the Texas Low Income Housing Information Service. “A lot of low-income people feel that if they complain, and a building inspector comes out, they’ll lose their housing. People put up with a lot of stuff in a tight market.”

In August, an American-Statesman investigation found that Austin lags behind every other large Texas city in enforcing laws designed to ensure that landlords provide adequate accommodations to their tenants.

“You have to fend for yourself out there as a tenant, because there’s no one looking out for your rights,” said Heather Way, a University of Texas law professor who has researched problem rental properties.

The Austin City Council last month passed a new ordinance requiring rental properties that are cited for several health and safety code violations within a year to register with the city and submit to periodic inspections — or risk fines and a ban on leasing any more units until problems are fixed.

Council Member Bill Spelman, who proposed the ordinance, said city leaders don’t yet have a handle on the scope of the problem because of underreporting and incomplete data. But, he added, “clearly something’s broken here. I’m convinced that we don’t know nearly enough about all the problem properties that we ought to.”

The new ordinance will help the city keep a closer watch on the properties that are known to be a problem. But because many tenants are reluctant to complain to the city for fear of losing their apartments, the law still won’t help identify “all the unreported, dangerous conditions out there,” Way said.

Spelman said once the ordinance takes effect and the city forces repeat offenders to fix their problems, city leaders should focus on identifying rental properties that haven’t attracted the attention of code inspectors.

“Showing that we mean business and we’re going to do our job will encourage people to complain (to Code Compliance) on their own,” he said.

Protection lacking

In late 2006, Kevin Bailey’s mother-in-law moved to Houston from St. Louis to be closer to her family, renting an apartment in the northwest part of that city. “By all appearances, it was a fairly nice complex,” recalled Bailey, who at the time represented the area in the Legislature.

Two days after she moved in, his mother-in-law, who was nearing 80 years old, told property managers she had no hot water. They insisted they were working on repairs, but the problem dragged on for six weeks, Bailey recalled: “She had to boil water just to wash her hands. It was not just an inconvenience; it was a health problem.”

As he researched his relative’s problem, Bailey discovered that while landlords must make a “diligent effort” to repair conditions necessary for tenants’ “health or safety,” Texas law doesn’t define what that means. “I was shocked,” he said. “Everything seems to be stacked in favor of the landlord.”

In 2007, Bailey sponsored a law requiring landlords to fix faulty water heaters. It remains the only specific description of what a landlord must repair, which leaves the question of what else must be fixed open to debate.

Tyler Hickle, an Austin lawyer who represents tenants, said he’s argued many cases in which landlords insist air conditioning isn’t a matter of health or safety, even at the height of summer. “They point out that Texans lived here for centuries without air conditioning,” he said.

The law also doesn’t address infestations of roaches, rodents or bedbugs — common complaints among tenants in low-end apartments. Cliff Bodenhafer said he fought for weeks with his landlord over a roach infestation at his South Austin apartment. Bodenhafer, who has multiple sclerosis and can’t use his hands, said he “had to yell for (my roommate) to come kill the roaches off me.”

He said the landlord’s own household pesticide treatment didn’t work, but he called an exterminator only after Bodenhafer called a news station and Code Compliance. Then the landlord tried to terminate his lease, he said. Bodenhafer sued for harassment, putting the termination on hold. “I don’t have money to pay for a new security deposit and find a new place,” he said.

In court filings, Bodenhafer’s landlord said his tenants brought the infestation on themselves by keeping too many pets and not cleaning the fourplex apartment. He added that he was terminating their lease because the Bodenhafers were disruptive and rude to other tenants, and because they weren’t keeping up his property.

Many states offer renters more protections than Texas, said Sandy Rollins, executive director of the Dallas-based Texas Tenants Union. It’s telling, she said, that only this year legislators finally passed a law requiring landlords to give their renters a full copy of their lease contract.

In a 2007 study, Rollins found that, unlike Texas, 43 states give tenants a period of time to make good on late rent or other contract disputes before landlords can begin eviction proceedings. And while other states limit late-payment fees, Texas says only that they must be reasonably related to a landlord’s costs — an undefined standard. Hickle said he’s represented clients with fees as high as 50 percent of a month’s rent, and “I’ve never seen a judge bat an eye.”

And in 2009, the Legislature changed the law so landlords could start charging late fees a day earlier than previously allowed.

Texas also permits a relatively speedy eviction process. Landlords must give three days’ notice to vacate before filing an eviction case — unless the rental contract states otherwise.

Many standard contracts narrow the time frame to a single day. In Southeast Austin, one landlord has filed dozens of eviction notices in recent years on tenants renting a group of duplexes on East Stassney Lane and Woodland Oaks Court. The lease agreement often has been a handwritten contract stating, “If rent is not paid in full on 1st you will be evicted,” according to documents at Travis County Justice of the Peace Court 4. Eviction cases often are filed a day later.

Even if the rent dispute is later resolved, once an eviction notice is filed in court, “the damage to the tenant is basically done,” said Fred Fuchs, an attorney for Texas RioGrande Legal Aid. “Most prospective landlords are not interested in leasing to someone with that on their record.”

Unlike in many other states, Texas landlords also can legally confiscate a tenant’s belongings if he or she is behind in rent. Some items are exempted — bedding, children’s toys, work tools — and the law is rarely invoked. But it can be a devastating tool when used or threatened, advocates say.

Other rules favor landlords in more subtle ways. State law, for example, requires that a tenant demanding repairs send two letters by regular mail, or one certified letter, detailing the fixes — requirements that, while familiar to landlords, often don’t occur to tenants.

“What people typically do is pick up the phone or send an email or a text,” Fuchs said — meaning that, legally, they haven’t complained. When that doesn’t work, tenants faced with unresponsive managers often withhold their rent — “the only thing they think they can do to gain leverage,” Fuchs said.

Yet Texas law states that once a tenant hasn’t paid rent due he loses his rights to the repairs. “Once you’re behind on rent,” Hickle said, “you don’t have a lot of legal recourse.”

Fighting landlords

After moving into their apartment in August 2012 with their three grandsons, the Wileys said they immediately notified Austin Commons management of their refrigerator roach infestation, but it took two weeks to get a new fridge.

By then, Janie Wiley was waking up with welts on her face and body from bedbugs — the swelling so bad she went to the hospital. The Wileys said it took seven months to get management to treat the apartment. Meanwhile, the entire complex was without gas for three weeks in December because of a gas leak, so nobody could take a hot shower.

Managers filed an eviction notice a month after they moved in, claiming the Wileys hadn’t paid their rent, court documents show. The case was dismissed, however, when the family produced receipts in court. But when Keith Wiley went to the office to pay their October rent, he said the manager refused the money, saying he still intended to kick the family out.

“Because we complain too much,” Janie Wiley said.

Austin Commons, now under new ownership and renamed Villas de la Luz, has filed 222 evictions since the beginning of last year under both owners — an average of about 11 per month — according to data from Travis County Justice of the Peace Glenn Bass’ office. That’s the most of any apartment complex in Bass’ Precinct 2, which includes North Austin and northern Travis County.

Code Compliance has issued 36 violation notices at the complex since 2011, the third-highest total in the city among apartments. The Lighthouse Group, the California real estate investment company that owned the complex when the Wileys moved in, didn’t return phone messages seeking comment.

The Wileys filed a separate retaliation lawsuit, and Keith Wiley, a former cleaning company owner, argued his case in June, going up against the apartments’ lawyer — and winning. Judge Elena Diaz awarded the couple a $1,309 judgment, according to court documents.

Janie Wiley said relations have since improved with the new management. “We’ve got some pretty good landlords; they’re pretty much on top of their business,” she said.

At Elevation, an apartment complex on Willow Creek Drive in Southeast Austin, a number of tenants said last month that they’ve had to go for days without water, which has been shut off repeatedly without warning.

The complex has received 50 code complaints and 15 code violations since 2010 — all of them prior to the property’s purchase in April by Presidium Group of Dallas.

Elevation Manager John Dawson said the water interruptions stem from ongoing renovations that require plumbing repairs and replacing water heaters. He said the outages don’t last more than 10 or 15 minutes at a time.

But Amanda Mejilla said her family had no water for four days recently. A half-dozen other tenants had similar stories and said they’ve resorted to buying gallon jugs of water to bathe. They said their complaints to management resulted in only vague promises that the water will come back on soon.

“We want to move, but we can’t because we don’t want to break the lease,” Mejilla said. “They’ll send us to court, and we can’t get another apartment, that’s what they told us.”

CONTACT DAVE HARMON AT

512-445-3645. CONTACT ERIC

DEXHEIMER AT 512-445-1774.