AUGUSTA — Landlords at a housing forum Tuesday said their business can bring more problems than profits, and they won’t be able to continue providing housing if they can’t make a profit.

During the last two years, Augusta has lost more than 100 units of rental housing to fire and to being shut down by the city because of code violations. Amanda Bartlett, executive director of the Augusta Housing Authority, said some landlords just don’t have the money to make even relatively simple upgrades to meet codes.

Additional Images

Augusta officials confer in 2013 outside an apartment building at 3 Jefferson St. after the city closed it and another apartment building, at 1 Jefferson St., for code violations. City officials, landlords and residents met in a forum Tuesday night to address the city’s rental housing shortage after more than 100 units in the city had been lost to code violations or fire in the past two years. Staff file photo by Andy Molloy

“A lot of landlords are well-intentioned. They do their best to take care of their buildings, but they just aren’t making any money,” Bartlett said. “They don’t have enough cash flow sometimes to even install an egress window. Some mom-and-pop landlords, they just don’t have any money.”

And it’s not just mom-and-pop landlords, either.

Landlord Tim Gooch, whose company owns multiple housing units, including the 30-unit Capital Village affordable-housing development in Augusta, said he, as the developer of that complex, made about $1,000 when all costs were calculated on a $6.5 million investment.

He suggested the city and the housing authority use money that becomes available to help landlords rehabilitate buildings and the owners of larger apartment complexes, because they will be required by lenders to meet building codes, and that can get expensive.

“It’s a complex issue, but you might wanna focus on (the owners of) larger units. They’re struggling,” he said. “Get people into decent housing and make sure landlords make a profit.”

Bartlett is working on a proposal she hopes could help.

Last week, at an Augusta City Council meeting, Bartlett asked councilors whether the city would partner with the Augusta Housing Authority to seek $500,000 in federal Community Development Block Grant funds to create a new program called “Great Neighborhoods.”

She said the program would help landlords and low-to-moderate-income Augusta residents by providing grants of up to $25,000 to assist in rehabilitating and preserving existing multi-family rental properties. She said priority would be given to repairs correcting safety code violations.

Councilors are expected to vote on the proposal at their Thursday business meeting, which starts at 7 p.m. in council chambers at Augusta City Center.

Rick Whiting, executive director of the Auburn Housing Authority, discussed how the organization worked with the city to rehabilitate several rental buildings with the city providing expertise and access to low-interest loans and federal grant money the authority used to rehabilitate previously unsafe and unsightly apartment buildings.

He said improvements to buildings, especially prominent ones, tend to spread to other area buildings once work gets going.

“Neighborhood restoration starts with one building and spreads from there. We’ve seen it over and over again,” Whiting said.

Fire Chief Roger Audette described the difficulty of fighting fires in Augusta, where the topography includes numerous steep hills, and where some apartment buildings are so close to each other there isn’t room to get between them to fight fires.

He said that topography presents challenges for landlords, too, because they might have to put individual fire escapes on multiple sides of the same building because of the number of different grades, and that can get expensive.

He also said modern materials found inside residences burn much faster than the more organic materials used years ago.

He said most apartments are on upper floors of buildings and urged landlords and tenants to make sure they have working smoke detectors.

“Ideally, we want people at a fire scene to be waiting for us in the street” because they were alerted to the fire by smoke detectors. “That’s where alarms can make all the difference.”

Augusta landlord Jim Snee said some tenants are destructive and cause safety and code problems in buildings. Solving those problems can be costly and frustrating for landlords, he said.

He urged officials to prioritize for grant funding by focusing on safety code problems and cited an apartment fire on Noyes Street in Portland last year in which six people were killed.

“I wouldn’t want to see a repeat” of the Portland apartment fire deaths, Snee said. “The thought of that makes it tough for us to get to sleep at night, all of us.”

Sprague and Curtis real estate agent Perry McCourtney presented housing market conditions and sales data for Augusta.

Overall, he said, the real estate market in Augusta is recovering with 200 residential sales last year, up from 162 the year before, and 132 in 2012. The average sale price was $115,000, down slightly from 2013’s $116,000 but up from 2012’s $101,000. He said sub-$100,000 sales are the biggest area of growth with only about a year’s worth of inventory on the market, while the above-$300,000 market is the slowest with an inventory of about four years built up in the market.

“We have less than a year inventory of homes under $100,000,” McCourtney said. “That market has come around. We have a lot of first-time home buyers. As that market continues to grow, hopefully it bumps everything else up.”

Sales of multi-family buildings increased to 30 in 2014 from 18 in 2013, and down from 35 in 2012. However, the average sales price in 2014 was $83,000, down from $105,000 last year and $93,000 in 2012.

McCourtney said thinks believes real estate continues to be a good investment, returning 3 percent to 4 percent a year.

About 45 people attended the forum.

Keith Edwards — 621-5647

kedwards@centralmaine.com

Twitter: @kedwardskj

Related Stories