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Sympathy for the Landlord
Lauren Smiley | Photo: Brittany McLaren | August 30, 2013
They’re greedy. They’re parasitic. They’re trying to fleece us all. It’s a familiar battle cry in San Francisco’s raging rental wars. But the truth is far more complicated.
Back in 1990, when rent control was just entering its adolescence, Melanie Griffith and Michael Keaton made a cheesy film called Pacific Heights with a plot so pro-landlord that it might have been written by the San Francisco Chamber of Commerce. (The IMDb blurb: “A couple works hard to renovate their dream house and become landlords to pay for it. Unfortunately, one of their tenants has plans of his own.”) Two decades later, I’m struck by the number of small-time landlords I’ve met who started out with the best of intentions, only to find themselves morphing into versions of the Griffith character and her hapless husband, with the migraines and legal bills to prove it.
A writer whom I’ll call Sharon owns a three-flat building in Glen Park with her ex. For years, they’ve lived in adjacent units in an oh-so-civilized arrangement to share custody of their son. They used to rent the remaining flat to a geneticist and his wife. Relations were “very cordial, very friendly,” Sharon recalls—she and the wife sometimes had lunch together. But as Sharon’s son got older, she realized that they needed more space, so the tenants had to go. Cozy relations soon froze into a cold war, the wife stopped talking to her, and she had to come up with $9,000 in relocation costs to get the couple out. “After that, I’m like, I don’t think I want to get that close to tenants ever again,” she says.
Or take a first-time home buyer—pseudonym Carol—who works for the city government. Inspired, of course, by visions of living in Tales of the City harmony with artistic neighbors, she rented out the second condo in her Lower Haight duplex to a friend who worked as a designer at Levi’s. Then, when the friend asked for a break in the rent, Carol hastily agreed before crunching the numbers and realizing that she wouldn’t be able to cover her costs. “I readily admit, my husband and I are not finance people,” she says. Before long, she was facing foreclosure. Meanwhile, the friend stuck her with an unauthorized subtenant who proved to be a nuisance and then refused to leave, costing Carol $50,000 in lawyer’s fees and lost rent to get him out. After that, she sold off the second unit, vowing, “I never, ever will be a landlord ever again.”
She’s not the only one: Some 35,000 rental units were vacant in 2010—an unknown number taken off the market by the fed-up Scott Jameses of the city—exacerbating the city’s housing crunch.
Meanwhile, San Francisco landlords are skewing much more corporate and faceless. As the biggest wave of new construction in recent memory comes to fruition, thousands of units will soon open up from Market Street to SoMa to Treasure Island to Hunters Point. The new construction may help ease the rental market by siphoning off the luxury tenants who compete with us mere mortals on Craigslist. Although developers are required to provide some affordable housing in the mix, the vast majority of the new units will not be subject to city rent or eviction controls—and you can be sure that the mom-and-pop landlords of pre-1979 buildings are griping about the double standard.
Still, not everyone is complaining. Michael Castleman is a sixtysomething freelance health reporter turned mystery novelist. An earlier novel of his, A Killing in Real Estate, features a couple who’ve outgrown their Mission place but can’t afford to move. In real life, Castleman was a lot savvier, putting his savings toward a five-unit building near 17th and Dolores in 1991, and then, after the dot-com crash, picking up a property at 16th and Valencia and another run-down building filled with immigrant tenants on Albion Street, near Guerrero. He’s figured out how a creative type can afford San Francisco: by becoming a landlord himself.
But far from trying to kick out his tenants with rent control, Castleman asks them what they want fixed. When a unit does come vacant, he’ll price it at 10 to 15 percent below market. “I don’t invest to maximize my financial return,” he says, sounding like a modern-day Mr. Madrigal. “I invest to maximize my personal happiness. A good return is an element of happiness, but there are other elements.” Mainly, he wants rental income without hassles. If tenants know that they’re getting a deal, they’re less likely to complain about little things. Does this market tempt Castleman to reconsider his strategy? “Of course,” he admits. “But I don’t want to be an asshole. I could make a couple thousand dollars more a month, but for the couple thousand dollars, I’d be buying a lot of headaches. I’d rather use my time writing fiction.”
The truth is that, for all the temptations and market pressures, there are plenty of Righteous Landlords still out there trying to keep the San Francisco we know and love from slipping from our collective grasp. Even Sarah Shortt, executive director of the pro-renter Housing Rights Committee of San Francisco, concedes that this is so. When I ask her for referrals to mom-and-pops who don’t gouge their tenants, she makes me swear that I’m not writing an anti–rent control screed. Then she agrees to “rustle up some anomalies.”
She doesn’t have to look far. As it turns out, Shortt, one of the most vocal defenders of tenants’ rights and a sworn enemy of landlords, big and small, has a good-guy landlord of her own. A year ago, she moved into a rent-controlled one-bedroom near 22nd and Valencia, one of the most coveted locations in the city. She says that the landlord raised the existing rent a mere $100, to a very below-market $1,250 (a one-bedroom down the street goes for $3,150). He told another tenant who offered up to $900 a month that he’d be satisfied with just $800. “This guy is super compassionate and human,” she says, “and also maybe a little crazy.” He may be crazy, but he’s no fool: When I call him to find out more, he doesn’t want to say a word.
Originally published in the September issue of San Francisco