City occupancy police are on the prowl
Being a landlord or rehabber can be a tough business. Juggling tenants and repairs are a struggle in their own right, but sometimes the most stressful things can less tangible. For instance: keeping up with occupancy codes. And as of late, the City of St. Louis has been rabid in their enforcement.
In the past couple months I have personally experienced incorrect condemnation warnings and heard similar stories from numerous clients. As any City-investor knows, just about any property in a Housing Conservation District needs to be inspected by the City of St. Louis before it can be occupied. These inspections need to occur whenever there is a change in property ownership or a new tenant moves in. Simple enough right?
The problem is that one of the ways the City polices these changes is utility bills. If the gas, electric or water bill user switches at a property it is often as evidence of one of these changes. A warning is typically sent to the property owner followed by eventual condemnation if the owner does not comply. And when accurate, I have no problem with this. The trouble is that the system is not always inaccurate.
Take my situation for example. I rehabbed a house during the fall and just finished with it a little over a month ago. Nobody lives in it and it is not under contract yet, but that doesn’t stop the City from sending me an ominous and threatening letter about getting an inspection. But since it is not occupied yet I am under no obligation to get the inspection. I know this and their language doesn’t frighten me, but it might be different for others.
A more drastic example is from one of my clients buildings. I represented him in the purchase of the property last summer and have been leasing apartments in the building for him. The property is a 12-family, and it currently about 50% occupied. All occupied units have had proper inspections, but the vacant units are being inspected after each is fixed up and occupied. As long as nobody lives in any of the uninspected units it should be no problem right? Tell that to the tenants that got a condemnation notice on their door the day before Thanksgiving. I don’t manage the place, but got a call from one of the tenants I placed in the building that night and he was anxious to say the least. I explained the situation to him and it all eventually worked out just fine, but neither I nor the property owner should have ever been placed in that situation.
Since there is no obvious fix for this situation, the best advice I can give is to understand your rights and responsibilities and keep up with them. In the event of an issue, if you are honest with your tenants any major issue can easily be avoided. Just make sure the communication are always open or you could find yourself in the middle of something that is a little more difficult to dig your way out of.
For the basics on these inspections check out the St. Louis Housing Conservation website.