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Date: 5/3/2022
NORTHAMPTON – On April 25, the City Council Committee on Community Resources conducted a public forum and discussion on a proposed bill that aims to eliminate broker’s fees for prospective Northampton renters.
The proposed bill, which is also known as a “home rule petition,” would instead ask landlords to take care of any broker expenses that may sometimes fall on the tenant’s lap when they agree to a place for rent. The goal of this petition is to create less barriers to affordable housing, especially since many prospective renters are already charged with first and last month’s rent, as well as other security deposits.
The bill was proposed and recommended by Ward 5 City Councilor Alex Jarrett, Ward 7 City Councilor Rachel Maiore and Mayor Gina-Louise Sciarra.
According to Jarrett, this proposed bill was developed based off a 2019 study spearheaded by the Pioneer Valley Planning Commission (PVPC) in conjunction with the city’s housing partnership titled, “Unlocking Opportunity: An Assessment of Barriers to Fair Housing in Northampton.”
The study, which is over 100 pages, went into detail about a whole variety of factors that impedes people from getting housing in Northampton, including costs, a lack of transportation, limited job opportunities and more.
According to Jarrett, while the proposed bill would alleviate the pressures for renters who typically must pay broker’s fees, the bill would not prevent tenants and landlords from developing a working relationship in some capacity.
During the discussion, At-Large City Councilor Marissa Elkins asked if this bill would eliminate brokers altogether, to which Jarrett answered saying that brokers would still be a valuable source for renters, but Jarrett also added that many people would still pursue the renting process without that middleman.
“In most of the country, the property owner pays this [broker] fee,” said Jarrett. “I think that this is a model that can work very well for brokers with the landlord paying. I would argue that the landlords currently have no incentive to reduce those fees.”
When Reminder Publishing spoke to Carmen Junno, the chair of the Northampton Housing Partnership, she said that rent prices could increase if landlords were the ones mainly responsible for the brokers fees. This is a possibility the city is considering as they move the proposed bill along through the process.
“What we’re trying to do is to allow folks to be able to stay in our city, and that would certainly be good for the economy,” said Maiore. “I think having folks be able to stay here is good for everyone.”
During the meeting, many Northampton renters and realtors spent close to two hours giving their insight on the matter, many of which spoke of their own personal experiences with broker’s fees.
A resident told the committee that he just received a notice to vacate his apartment after finally receiving a salary-based job. Although he would love to stay in Northampton close to his family, he makes a little too much money to be eligible for a Section 8 voucher and told the committee that the broker’s fees were a major barrier for him.
“The moving cost of rent alone, with the additional broker’s fee, actually is more than a month’s worth of pay for me,” the resident said. “This would be a wonderful first step to making renting in Northampton more accessible, but it’s a first step. There’s a lot more to do.”
Lemy Coffin, another renter in Northampton, said that broker’s fees paid by tenants cripple people’s chances for affordable housing. “I’ve been heavily discouraged to even look for housing,” said Coffin, who has been renting in their apartment since 2017.
Coffin said that they have been paying upwards of $300 a month for heating since the insulation in their apartment is “so bad,” but they do not have the energy to look for a new place since rent prices would be so high. “Not only do [broker’s fees and high rent costs] create a barrier to entry, but it also disincentivizes landlords and property management companies from performing upkeep on current properties because there’s such an incentive to stay where you are in Northampton,” they said.
The committee ultimately decided to recommend this proposal to the Legislative Matters Committee, but before it reaches that point, Elkins – who is supportive of the legislation – asked if Jarrett could find some specific examples of cities that eliminated brokers fees for tenants so Northampton can have a better idea of how to approach the situation.
Jarrett argued that property values and rental rates have increased much faster than wages in the last couple decades, which is another cause for barriers to affordable housing. “We don’t want to create an excessive burden, and especially mom and pop property owners, but we also have to realize how much property owners have benefited from this market,” said Jarrett. “When weighing that, and trying to find a balance here, this seems like an appropriate step to take.”
Sciarra said that this legislation is for those who are having the hardest time finding affordable housing throughout the city. “We know that this one extra fee is often very much the thing that keeps someone from gaining housing,” said Sciarra. “The goal is to try and remove that barrier and do everything we can to enable people who are on the edge of not being able to find housing.”
Ward 4 City Councilor Garrick Perry also expressed his support for this step in reducing barriers to affordable housing, saying that he appreciates how proactive the city is in tackling this issue. “It’s not going to be solved by one thing,” said Perry, referring to the barrier issues. “We have to use all of the tools in our toolbox in order to achieve what we want, which is a more diverse Northampton.”
The amended order will once again be brought up during the Legislative Matters Committee on May 9 at 5:30 p.m. If all goes well, the order will then be discussed at the May 19 City Council meeting.