Nov 19, 2021 - Real Estate

Why Philadelphia struggles to enforce rental codes

Illustration of a tape measure with a shrug emoji on the tape instead of inch marks.

Illustration: Brendan Lynch/Axios

Philadelphia doesn’t regularly inspect rental properties, which means only about 7% of rental units get inspected every year, according to new Pew Charitable Trusts research.

Why it matters: Philadelphia’s old single-family rental stock is vulnerable to housing quality issues. About 40% of rental properties need repairs, concentrated in households with incomes below the poverty line.

  • The Department of Licenses and Inspections inspects rentals only when a formal complaint is filed.
  • And more vigorous enforcement could mean landlords need to cover the costs of improvements with increased rents.
  • "Housing conditions can influence your susceptibility to things like susceptibility to injury, lead exposure and breathing conditions like asthma. We want to have a city where people are safe in their homes," Octavia Howell, a manager at Pew Charitable Trusts, said.

The big problem: Despite landlords being required to obtain licenses, those rules are frequently ignored, and enforcement is difficult.

  • Pew estimates that 45% of rental properties — 30% of rental housing units — were unlicensed in 2020. The exact number is unknown, and how many are compliant with city codes is also unknown.
  • L&I collects data on property complaints, inspections, violations and permits — but owner data is often out of date, and the department struggles to measure ongoing compliance.
  • About 10% of Philly landlords operate as LLCs and own a little less than a third of the city’s rental properties. The practice makes it hard for the city to locate owners and keep them accountable.

Zoom out: This isn’t unique to us. In Cleveland, 44% of all rental units were unlicensed in 2019, and somewhere between 20% and 30% of landlords in New York City don’t register their units.

  • Chicago, Milwaukee and New York also have complaint-driven systems.
  • Other cities strengthen registration requirements by contracting third-party inspectors or using public funds to make repairs for non-compliant owners.

What they’re saying: Karen Guss, the communications director for L&I, told Axios the department is understaffed, and rental inspections are only one of many responsibilities.

  • "We have to figure out how to get that much work done in the context of resources that are already stretched," she said.
  • Guss said proactive inspections would mean double the amount of inspectors.
  • Paul Cohen, the lawyer for the Homeowners Association of Philadelphia, a landlord association group, said the organization advocates for landlords to get licensed but doesn’t check if members actually did so.

The other side: Vikram Patel, a tenant lawyer at Community Legal Services, said rental code violations come up often when he’s representing his clients.

  • "It’s rare that we don’t come into habitability issues, especially with low-income tenants," he said.

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