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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowA professional organization that represents central Indiana’s Realtors opposes an ordinance in Fishers that would cap the percentage of single-family rental houses in the community’s subdivisions and create a registry program for landlords.
Under the plan developed by Fishers city leaders, landlords would be required to register rental houses and receive a permit that would remain valid until the owner decided to sell the property. The plan calls for limiting the percentage of single-family rental units per subdivision to 10%.
City leaders are concerned that single-family rentals account for at least 10% of the total houses in 50 subdivisions across the city. In some subdivisions, such as Brooks Chase and Brookston Place on the city’s east side, the number of single-family rentals reaches 30% to 40%.
City officials say almost half of the single-family rentals in Fishers are owned by out-of-state landlords and 25 percent are owned by institutional investors.
Chris Pryor, chief advocacy officer for the MIBOR Realtor Association, said Monday night at a town hall event that the organization worked with Fishers for the past two years on a plan to limit single-family rentals. However, he said MIBOR opposes the current proposal because the organization’s leadership is concerned that it would restrict property rights, limit housing options in Fishers and interfere with the free market.
“We think that there are several unintended consequences, such as increasing rent rates, which can result from that, so our association has taken a stance to oppose this,” he said.
Pryor spoke at a discussion about the ordinance that was organized by former Fishers City Council member Jocelyn Vare at Hamilton East Public Library.
He added that MIBOR sees the topic of corporate investors purchasing single-family houses as “an issue that happened in the past” as there were more sales of houses by investor groups in the past two years in Fishers than purchases.
“The market has changed significantly, and those investors are not purchasing like they were before,” he said. “We think the city is really trying to address a problem that was really a phenomenon of the past when market conditions were different, and we really think that we need to move on down the road and look at other issues.”
The town hall drew about 25 people and featured a panel discussion with Andrea Davis, executive director of Hamilton County Area Neighborhood Development Inc., or HAND, which provides affordable rental housing in Hamilton County; Steve Ladig, a real estate broker with Latig Realty LLC and a property manager; Janet Pritchett, a mortgage adviser with Noblesville-based The Parker Mortgage Team; and Meighan Wise, a residential real estate broker with The Wise Real Estate Group.
The panelists agreed that they believe that reducing the number of single-family rentals would raise monthly costs for renters and provide fewer opportunities in Fishers for people who want to live in a house but are not in a position to purchase one.
Critics say having too many rental properties in a subdivision can cause property values to decline, hurt the neighborhood’s appearance when tenants and landlords don’t prioritize maintenance, and lead to having too many transient residents.
Some homeowners associations and OneZone, the joint chamber of commerce in Carmel and Fishers, have expressed support for the rental cap and registry system. OneZone issued a statement arguing the rental registry program “will provide important transparency and accountability for rental properties, while the 10% cap “will help preserve homeownership opportunities, protect property values and support the overall quality of life in Fishers.”
Earlier on Monday, Fishers Chief of Staff Jordin Alexander hosted a webinar to discuss the ordinance.
Houses that are registered as rentals before Dec. 31 would be grandfathered into the plan and would not subject to the 10% cap until they are sold to a new owner, who would be required to register the home. An application would be denied if a subdivision has reached the 10% limit.
Landlords who do not register a house by Dec. 31 would be subject to a $250 fine. Operating a rental house without a permit would result in a $1,000 fine for the first violation and fines ranging from $5,000 and $7,500 for subsequent violations.
Exemptions would include people renting a house to family members or legal dependents, people renting out a house due to a job relocation, people who are on military deployments and people who are renting out a house because selling it would cause undue burden.
The Fishers City Council is expected to hold a public hearing on the ordinance at its meeting on April 21. Council members could vote on the ordinance at their meeting on May 19.
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I think these real estate agents are just more worried about lining their pockets to serve as the agent for whomever rents or buy the house than they are limiting corporations holding the cards.
The more “control” the more expensive housing becomes. It’s no different than rent control markets. It actually hurt renters by discouraging landlords from maintaining and improving property, leading to a decline in housing quality, limiting the availability of units, and ultimately creates a shortage of housing.
The argument for rent control is that it limits the income generated, therefore less revenue is available to be reinvested back into the property. This isn’t limiting the rent that is able to be charged. Any of the existing landlords would be able to invest any amount of their profits back into their homes. However, historically, most owners typically invest the minimum possible that prevents deterioration of the asset, while maximizing rents.
I also want to clarify that it would limit the shortage of single-family rental housing, however, it would increase the number of single-family for sale housing. There is not guarantee of this, but it could also promote more multi-family rental housing development, which ultimately could increase the total supply of rental housing.
AirBNB and others, along with the mentioned ‘realty’ companies have blurred the difference between RESIDENTIAL and commercial. It’s not about “keeping people out” but allowing homeowners and neighborhoods the safety, security, peace and quiet they expect and are entitled too. Keep short term rentals in motels and hotels in properly zoned areas. That’s why they are zoned accordingly.
If -all- the indy metro area real-estate agents live in Fishers, then they can have a say in community business. Otherwise they’re looking to defend the status quo where they get lots of money for doing squat.
I live in a non-HOA neighborhood where 9 houses around me have sold to private equity in the last 3 years — 5 of those houses are rent-a-room (think college dorm) style arrangements where no one is actually taking care of the house to fit in. That does not build a community or a sense of safety.
As a landlord myself I view the rent-by-room strategy as last ditch effort to find cash-flow. It doesn’t build a sense of “ownership” even if it’s rental property. Our tenants stay with us for YEARS and treat our properties better. Our rent increase are way below market and that’s by design. In my opinion rent-by-room is difficult and unsustainable.
Private equity is only concerned with their asset. They do not care about the communities their assets are located in. The City is attempting to prevent homogenization and transience. It should be commended.
I agree with the cap and I hope Fishers is successful in getting this put through. Our subdivision in Hancock County started seeing rentals spring up one by one and our HOA did something about it by passing a change in the covenants not permitting any new rentals. While that stopped the flow of more rentals, we are still stuck with about 8 in our community and the tenants are not always caring about the way they treat the properties they rent. Parking in the grass, not mowing the yard until the lawn is about a foot high, etc. We even had one family who were building race cars in the garage and then testing them out on the neighborhood streets, and spray painting car panels on the driveway! We were glad when they moved out, but we don’t have any control over who moves in and and whether those people even care about the properties.
In Indy the old adages still prevail….nothing parties like a rental….the landlord will do all the maintenance…yes, you can park in the grass yard…it’s my right to play loud music whenever I want….
Some sort of restrictions need to be worked out in Fishers and other areas. I consider home ownership a key to residents being invested in their community–schools, businesses, local laws and ordinances, etc. Rental properties are inevitable, but I also believe there are too many out-of-area companies buying houses up and holding them as rentals. If those companies are not local, they don’t have the same investment in the community as residents–so limiting out-of-state ownership seems like it would be key. I don’t like the idea of price control or a landlord registry.
Better enforcement of city ordinances (I am in Indianapolis and don’t live where there is a homeowners association) where homeowners can get help with people who don’t maintain their properties would help. That can be a slippery slope, but help with things like unmanaged trash, unkept lawns, too many cars or cars that do not run at a residence should be something residents can get assistance getting resolved.
Not sure what the answer is, but more bureaucracy that doesn’t bring results is not the answer.
Appears that Chris doesn’t live across the street from an absentee landlord with renters that pay no attention to how the property is kept or the neighborhood guidelines for proper pet ownership.
Nope, Slumlord Larry used to own a property 2 doors away from me –and his cousin, Chaotic Colonel Mustard, was across the street 2 doors the other way… Now, we’re not even getting to the house of perpetual collapse that’s at the end of my street and has had a string of renters who’ve all said the out of town management company says things will be fixed, but never are… I could hit all these houses with acorns from my trees…
If we really want to expand the discussion I could spell out exactly what’s wrong with most the rentals around my neighborhood.
(BTW — not flaming you…just expanding what I see from my garage door…)
To be fair, I have seen all of the problems and issues mentioned here by owner occupied residents, as well as tenants. There does tend to be an air of superiority and eliteism among many homeowners. Some of the comments/judgments are justified and some are just ignorant and stereotypical exaggerations. Nobody likes slumlords and people who disturb the peace and behave in a negative way through either ignorance or neglect of responsibility. But creating more bureaucracy is NOT the answer. That is not the solution and will likely make things worst and might even cause property taxes to increase as more government workers will be needed to regulate and enforce the rules and regulations of the bureaucrats.
Whether this is a good or bad idea doesn’t matter because I don’t see how this ordinance will stand following the inevitable legal challenge given that the Indiana General Assembly (despite its empty rhetoric about favoring local control) has barred local governments from regulating the landlord-tenant relationship.