Mark Hayward's City Matters: Building owner says it's not easy being a landlordBY MARK HAYWARD
New Hampshire Union Leader
May 21. 2014 9:23PM
Devonna Peno has had it with her landlord.
She lives at 215 Wilson St., a three-story tenement building owned by Formosa LLC. There are the cockroaches and bedbugs, but her latest gripe is the trash dumped in a narrow alley beside her building. The day before she spoke, workers threw old carpeting and tacking strips — the short nails still sticking out of them — in the alley.
“It’s unsafe for children,” Peno said. “It’s always like this. It’s always a mess.”About a mile away, Chad and Lisa — who live in a third-floor apartment at 416 Belmont St. and insist their last name not be printed — said Hsiu Chang, a co-owner of the Formosa company is OK.
He repaired a leaky roof quickly, a cockroach problem ended when the downstairs neighbor moved out, and Chang let the couple slide one month when they were $100 short in their $700 rent.
But the stairs weren’t shoveled during the winter, and trash isn’t always quickly removed.
“I think he does the best he can with all his properties. I think he needs to get more help,” Chad said.
Hsiu (pronounced Show) Chang is one of four landlords singled out earlier this month by Granite State Organizing Project in a report that raises alarms about unsafe, unhealthy, substandard apartments in the city.
This ping-pong match of accusations has gone on for years in this city. Tenants say apartments are in terrible shape. Landlords say the complaints come from deadbeat tenants who don’t pay rent and cause the damage themselves.
Chang offered to show me vacant apartments — one which was cleaned and freshly painted — and discuss his business. He also encouraged me to speak to his tenants.He faults Granite State Organizing Project for relying strictly on inspection reports and complaints filed at City Hall. They include nonworking smoke detectors, leaks, bugs and trash.
“We would be slumlords if we didn’t fix the issues. But every single issue in that report was resolved,” Chang said.
Project Director Sara Jane Knoy said Chang and the other landlords buy properties in bad shape. They undertake minimal repairs, so they end up with tenants who have no desire to care for the property.
“They should do a better job,” Knoy said.
Chang is an immigrant from Taiwan who went through Manchester schools and has degrees in communications and biology from Vanderbilt University. He’s obviously a hard worker.
His iPhone rings constantly. People who are scouting new apartments call. He texts tenants to let them know when an exterminator will come by. He arranges a time for a subcontractor to contact the only English-speaker in a tenant family.
He said his company owns 86 units in 16 buildings. When Formosa invests in rental property, it aims to pay about $40,000 for an apartment. The company rents the units for $800 to $850 (no heat), knowing expenses will be high and revenue inconsistent.
Chang said everything boils down to economics. It does no good for his customers — his tenants — to get mad at him, Chang said. The worst thing is when a tenant stops paying rent. The eviction process takes months, and Chang can lose $2,000 to $3,000 in unpaid rent, fees and repairs, he said.
“This is not a magical world where the landlord buys everything in cash and abuses the low-income people,” Chang said.
Chang’s parents live in Bedford, and he has an apartment in Somerville, Mass. He drives a Prius. He said the family has a Mercedes, but it’s a 2004 model, purchased when they could afford it. He can’t afford health care, he said, but he said he’s not sure how much money he made last year.
“We are not rich,” Chang said.
Between the city’s inspection process and “simple economics,” the system works, Chang said.
• He said he undertakes whatever repairs come up during city inspections, which take place once every three years.
• Even though he’s sure the 114-year-old Belmont Street building he shows me has lead, he doesn’t want to abate it. Although the government would pick up most of the cost to remove lead, his apartments would be vacant while the work takes place, he said.
He notes no child in the Belmont Street building has ever been poisoned by lead, although other properties have had lead poisonings.
• Insects aren’t so easy. Whenever a tenant complains to the city, he has to hire an exterminator.
He emailed me a spreadsheet that showed $1,590 in exterminator bills for the past 2½ months.
But it doesn’t always work. Chang said sometimes tenants won’t grant access to their apartment, or they don’t keep it clean, which just creates opportunities for bugs to live and eat.
Chang said about 10 percent of his tenants are behind in their rent. He said the recession hit hard because many tenants lost work and could not pay rent. He said many remain discouraged, and times are tough for his company.
So what should be done about bad property?
Granite State Organizing Project wants a tougher inspection process — tighter standards, higher fines, more inspectors and annual inspections for problem properties.
Chang said he’s fine with tenants putting rent payments in escrow until repairs are made. But he said the tenants who complain the loudest probably owe a lot of back rent.
Peno, who lives with her father in the Wilson Street apartment, said he is up to date in his rent, and they want to move. While we stood outside and talked, two other Formosa tenants shrugged while they walked past the junk pile.
One said he’s lived in worse places. Another said Chang is OK to her.
Peno wants the junk cleaned up.
“If he’s not going to do it,” she said, “the city should come and do it, or he shouldn’t be able to own properties.”
Mark Hayward’s City Matters runs Thursdays in the New Hampshire Union Leader and UnionLeader.com. He can be reached at email@example.com.