I’m writing to share the financial realities we’re facing as small property owners in Santa Barbara. We’ve been working hard to maintain and improve our three rental properties — not just to meet code, but to ensure they remain safe, accessible, and livable for our tenants.
I realize that most rents in Santa Barbara are incredibly high and that tenants are not always treated fairly. Our rents have always remained well below comparative rents and our tenants tend to stay forever. Which has come to penalize us now.
There are many agencies and financial support resources available to tenants. Free legal advice, rental assistance, etc. That’s great. But there’s nothing for landlords.
Last year we completed a badly needed repair of a kitchen in a charming, old house in a great midtown location. There were broken tiles, holes in the floor, and very old appliances. As you can imagine the project encountered many unanticipated challenges, including complications with utilities, permitting, and major structural work. These were essential improvements, not cosmetic choices.
That kitchen project cost very close to $100,000.
Now, we have been informed of another even more serious problem, on the same property. It seems the toilet and sink have been leaking for some time, resulting in the wooden understructure being seriously compromised, and the floor undermined.
Clearly urgent and necessary repairs are needed. This will require demolition of the bathroom, repair of the sub-structure and floor, and installation of all new bathroom fixtures. We don’t yet have quotes for the next phase, but based on prior experience, I anticipate it could be another $100,000 project.
At the same time, recent rental regulations have limited rent increases across the board, without any consideration for where rents were previously. Our rents were already low compared to others, and as a result, the allowable increases are significantly restricted. We’re now in a position where we cannot raise rent enough to offset even basic costs, let alone major repairs. Our rental properties are the source of our retirement income. It’s a big problem.
No wonder so many landlords are selling their properties to large corporations that can absorb these kinds of losses. We want to continue providing housing in Santa Barbara, but the current policies make it increasingly difficult for small, responsible owners to stay afloat.
My husband and I are asking the council to explore offering low-cost financing options for landlords to address urgent and necessary repairs. This would aid in maintaining safe, habitable housing for tenants while supporting landlords in our community.
I have applied for a home equity line of credit. The interest rate is 7.75 percent. It would help significantly if the city offered low-cost financing assistance to landlords in these cases.
