Landlords move forward with fall leasing period, rent increases amid the pandemic

Wednesday, October 7, 2020 - 12:00pm

Landlords in Ann Arbor say they are pushing ahead with fall leasing for the 2021-2022 school year.

Landlords in Ann Arbor say they are pushing ahead with fall leasing for the 2021-2022 school year. Buy this photo
Jeremy Weine/Daily

Landlords in Ann Arbor are pushing ahead with fall leasing for the 2021-2022 school year, despite the ongoing COVID-19 pandemic, while students question if they should sign leases as early as they have in prior years.

The fall leasing period many Ann Arbor landlords observe — in which tenants whose leases start shortly before the academic year begins are asked to decide whether to renew less than three months into their lease — has pushed students to make quick decisions about their off-campus living situations for years. Under the circumstances of the pandemic, however, long-term planning and dealing with these early deadlines have become a bigger challenge for students.

This is the case for LSA sophomore Mia Waelchli, who in late August moved into an apartment unit managed by Varsity Management, a company that manages more than two dozen off-campus properties in Ann Arbor. A little more than three weeks after her lease began, she and her roommates received an email from Varsity inquiring about their plans to renew their lease for the following year. Varsity gave them a Nov. 6 deadline for renewal. 

Waelchli said while she understands why landlords would want to get an early start to leasing, the uncertainties regarding the pandemic and whether future semesters at the University of Michigan will have in-person components make it more difficult to decide on a tight timeframe.

Waelchli said when she first signed the lease in November 2019, she was excited about the apartment’s location because it meant she would be close to her classes. 

“Then, suddenly, there were no (in-person) classes, and it’s not something that I would have ever thought would happen,” Waelchli said. “So now I’m just wary to sign something early again.”

Waelchli isn’t alone. Various property management companies are asking tenants to commit to long-term plans in uncertain times as landlords move ahead with November deadlines for renewal.

Eric Jensen, who owns several rental properties in Ann Arbor, is among those who are continuing with a November deadline. Jensen emphasized that student demand helps maintain the unusually early leasing period in Ann Arbor from year to year, even amid the pandemic.

“It’s kind of this never-ending cycle that students want to get the best places possible,” Jensen said. “And so to find the best place as possible they start as early as they can to start looking. And if landlords want to get in on that cycle of when students are really looking, landlords have to be able to make their units — at least information about the units — available sooner rather than later.” 

In 2018-2019, the occupancy rate for off-campus student housing was 98 percent, according to a report from Triad Real Estate Partners.

Jon Keller, alum of the University and owner of his namesake company, which manages over 100 off-campus rentals in Ann Arbor, wrote in an email to The Michigan Daily that the November deadlines aren’t as early as they once were, thanks to a city ordinance requiring landlords to wait 70 days after the current lease period has passed before showing or leasing a property for the following year.

“When I was at U-M (2002-2006) we would pick up our keys on September 1st and be forced to sign for the following year, or lose the house,” Keller wrote. “It was incredibly stressful for students — oftentimes with the best houses rented years in advance. The 70-day leasing ordinance allows tenants to get acclimated to the new house, the location, even their group, and then determine if they want to stay for another year.”

Before the 70-day ordinance was passed, landlords were technically required to wait 90 days. Some city government officials have made unsuccessful attempts to push the leasing period back even further to the winter semester.

In addition to maintaining the fall leasing period deadlines, several landlords are also moving forward with raising rent for next year. Others are staying the course.

“In terms of what I’m doing with rents for next year, I'll just say that I’m being consistent with what I’ve done in the past,” Jensen said. 

Oxford Companies, another major property management company in Ann Arbor, will be raising rent next year. Katie Vohwinkle, the company’s associate director of residential property, said that in order to be mindful of the unexpected economic strain imposed by the pandemic, the rent increases are lower than in years prior. 

“We understand that this year is a bit unique for basically all of us, including the students at the University,” Vohwinkle said. “Our annual rent increases are significantly lower this year than they have been in years prior, despite higher increases that the buildings and the owners are still receiving for taxes, maintenance costs, utilities, that kind of thing.”

Affordable housing advocates say a rent increase, no matter how small, is still a disadvantage to people from low-income backgrounds. Julia Goode, a member of the Ann Arbor Tenants Union, said the early leasing period also poses challenges for students who cannot depend on their parents’ income when deciding where to live. 

“It’s really impossible for working people to be able to sign a lease eight months in advance,” Goode said. “The only reason why students can really do it is if they have parental help, which many students don’t have. So it does really create a great economic unfairness that doesn’t have to be there.”

Keller also noted that certain costs prohibit freezing or lowering rent, adding that he believes tenants have room to negotiate with their landlords next year.

“While we would love to keep rents flat on renewals or even lower them at times, the carrying costs like property taxes, utilities, lawn and snow care, maintenance and insurance rates go up every year,” Keller wrote. “It would be difficult to lock in a rate for too long a period and continue to make money … All that being said, there is probably more room than in previous years to negotiate a more attractive renewal rate.”

Advocates for affordable housing have voiced opposition to the early leasing practice in the name of tenant rights as well as issues of access for low-income students.

LSA senior Lindsay Calka said the early leasing period puts students in a compromising situation, many of whom are unaware of their rights as tenants.

“I think a lot of landlords take advantage of that (early leasing period) and put their tenants in a position where they have to make decisions,” Calka said. “They’re able to hike up rent or change things about … the lease that maybe tenants wouldn’t be wanting to do or (would) want time to bargain on, or at least have discussion on.”

Jennifer Hall, executive director of the Ann Arbor Housing Commission, echoed these concerns. She said certain decisions in the University’s power affect the housing market and can limit accessibility for low-income students.

“The U-M has a significant impact on the local housing market through the number of students they admit and enroll, the number of housing units they provide, the number of staff that they hire and the properties they purchase and develop,” Hall wrote in an email to The Daily. “As a U-M alumna and local resident, I think the U-M needs to be more proactive about providing housing at a reduced cost to low-income students.”

Both Goode and Calka said they see opportunities for students to organize and assert their rights in the present moment.

Goode pointed to the Graduate Employees’ Organization’s advocacy around housing as providing a model for other students to follow. GEO also recently went on strike to demand the University provide increased protections for graduate students with partial success.

Goode also said she hopes students registered to vote in Ann Arbor will vote in favor of the affordable housing millage on the ballot in November because the funds will help address the demand for more housing. 

Calka said affordable public housing is connected to other issues, like public health.

“Obviously public health is something that’s come to the forefront of people’s priorities,” Calka said. “We see a lot of Americans reconsidering what they’re willing to do and not do and what freedoms that they’re willing to sacrifice for the health of the community, which I think has been really great. But the next step is getting people to understand that housing is a social determinant of health and getting people housed is a public health matter.”

Daily Staff Reporter Julianna Morano can be reached at jucomora@umich.edu.


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