Proposed Skokie rental regulation will impact all property owners

Property owners generally have one thing in mind when selling their home – obtaining top dollar for their property.  The money a property owner walks away with upon closing is often used to purchase a new home, send children to college, or help ensure money for retirement.  And one of the ways to ensure a property owner receives top dollar is by marketing the property to a wide universe of potential owners, including investors.

Unfortunately, a re-proposed, excessively-burdensome Skokie rental regulation ordinance may cause some property investors, and even some homeowners, to skip Skokie and invest their dollars elsewhere.  If demand for Skokie real estate declines, home prices will similarly decline – it’s econ 101.

While the problems associated with this ordinance are too numerous to list, among the concerns are:

• For no apparent reason, new property owners will have to sit on their property for 30 days before even beginning to market the property for rent.  Requiring property owners to sit idle and do nothing to market their property for 30 days will be financially detrimental to most and devastating to some.
• Landlords will be forced to begin evictions even if the tenant is simply suspected but not convicted of a crime.  Landlords will subject themselves to possible litigation for wrongful evictions.
• Landlords will have to both undergo a consultation with a police officer and take a property management course taught by Village staff with no background in property management.
• Despite the Village saying this is a registration, not a licensing ordinance, many licensing components are proposed.  Including a requirement that, if the Village refuses to issue a registration, landlords will have to immediately eject his or her tenants onto the street or face stiff fines.  This requirement stands despite the fact that state law prohibits immediate ejection of tenants without a court order.
• The occupancy standards for renters are more restrictive than for owner occupied properties, and the standards are in likely violation of fair housing laws.
• An owner of a two-flat that lives in the second unit and whose elderly mother (even if she does not pay rent) lives in the first unit will have to comply with this ordinance, including taking a course and consulting with police officers to learn how to “manage” his or her mother.

Skokie homeowners should also keep in mind that if they ever choose to exercise their right to rent their home, these regulations will apply to them as well.

The question remains, why would an investor purchase in Skokie, when he or she can purchase in any number of municipalities, such as Lincolnwood or Wilmette, without these burdensome, costly regulations?  If they do not bypass Skokie altogether, it would be rational decision would be to offer less money to offset the costs and headache associated with this ordinance.  Skokie officials would best serve the community by doing no harm to the recovering real estate market.

The Skokie Village Board is expected to next address this matter on Monday, November 18 at 8:00 p.m. at Skokie Village Hall.

Skokie resident Howard Handler is Government Affairs Director for the not-for-profit North Shore – Barrington Association of REALTORS® – the area’s leading private property advocate.  Handler, a licensed real estate broker, received his undergraduate degree from the University of Wisconsin – Madison, and his master’s degree in Public Policy and Administration from Northwestern University.  He can be reached at: hhandler@iar.org