After reading the article on the “Summit on the Status of Housing in Addison County” in the June 26 Addison Independent I felt compelled to share some of my experience as a landlord of 39-plus years.
The reason that Vermont has an affordable housing crisis is very simple. Property taxes are way too high. Vermont landlords are the highest taxed people in the entire nation. Vermont has the highest property tax and 100 percent of what a Vermont landlord makes money on is taxed at that rate. A few years ago I did a significant amount of research trying to find out how many apartment houses in Vermont had been lost to foreclosure. The court does not differentiate between rentals and residences but I was able to make an educated guess that put the number at 20,000 or so apartment houses. Nearly all of these approximately 50,000 apartments taken out of the rental market were taken out because of what I often refer to as “Vermont’s War on Landlords.” It is a war that has many fronts but the sheer weight of the taxes is perhaps the single biggest problem. Unfortunately, most of the “solutions” in the article call for more taxes.
Let’s pretend for the moment that Vermont “needs” all the taxes it currently collects. Vermont must lower property taxes and use no other sources to raise the taxes that are needed if a healthy rental market is to exist. The state controls a large portion of the rental market in the Vermont, which holds rents down while taxing us to the hilt. Of course, when the state gets into the rental market that raises taxes exacerbating the problem again. Vermont has, on many occasions, over the past several years spent as much as a half-million dollars per unit in creating new rental housing and then charging virtually nothing for rent as the taxpayers not only must pay to build these extravagant facilities but then must pay to subsidize them, which of course means more taxes and more privately held units taxed out of the market and private landlords competing for the tenants that do not qualify for the state’s extravagant units because the state has found them undesirable, for example, tenants with pets, or that have a history of being too messy or not paying their rent.
One statistic stated in the article that is not close to reality is that the vacancy rate is less than 1 percent. That would mean the average apartment is vacant three days per year. That is an absurd number not close to reality. Furthermore, the state makes it very difficult to evict bad tenants. The process is long with many potential pitfalls. I have done hundreds and hundreds over the years but even I slipped up twice over the past two years. Currently I have a tenant that I evicted in January because I found that they had done approximately $2,000 in damages after one year in the apartment. I am waiting now for a final hearing that will not happen until Aug. 30 at the earliest. If I am lucky I may still have an apartment left by the time I am finally going to get control of my unit again in September. Then it will be two to four weeks to do repairs and who knows how much time to find an adequate tenant, which is a very difficult undertaking. The state has supplied the tenant with a taxpayer-funded attorney which has stretched the process out. That is the latest front of “Vermont’s War on Landlord,” free attorneys for any tenant getting evicted.
My sister was recently evicting a tenant who had someone move in with her that was selling drugs. The state’s “free” attorneys approach the tenants as they enter the court to represent them, they don’t even have to ask! My sister was threatened with everything under the sun including race discrimination if she did not give in and let the tenant stay. The state has referenced this program as an effort to fight homelessness in Vermont. What should happen is that the landlord/tenant laws should change so there is penalty for someone destroying property and not paying their rent. Currently there is none and the state actually has many policies that embrace bad tenants.
I could go on and on but it is clear the overreach of the state and the unbalanced landlord/tenant laws are what is causing the housing crisis. The state can repair it in time but only by completely changing course and allowing a landlord to turn a profit, after all that is not a crime. Also, over the past few years another result of “Vermont’s War on Landlords” is that property owners faced with no possibility of turning a profit have gone to renting Air BnB–style so, thousands more units have come off the market out of self-defense.
The state has created an enormous problem that only they can repair by getting out of the rental business, selling the units they have purchased and built. Of course, this would mean taking a huge hit now but not bleeding taxpayers to death over the time with huge losses and more ridiculously expensive units. Then fixing the tax burden and just getting out of the way.
Bryan Jones
Salisbury