Long-term leases are shopped around, again

The California-based owner of several Keizer and Salem area manufactured home parks is, again, urging existing residents to sign long-term leases. 

A flyer distributed to residents of Wildwood Villa in north Keizer pitches the long-term leases as a way to take advantage of a lower 4 percent rent increase this May. 

However, language in the long term leases given to residents in 2019, and reviewed by Keizertimes, offer no guarantee of a minimized rate increase and even the language of the flyer is not as straightforward as it might appear. 

The flyer states that “base rent increases will be 4 percent instead of the average market increase of 6 percent to 10.3 percent, as allowed by the Oregon Senate Bill-608.” 

SB-608 caps rate increases at 7 percent plus the inflation based on Consumer Price Index for Western States, but it does not mandate an increase. The overall cap also decreased to 9.9 percent Jan. 1.

The last contract Keizertimes reviewed also stated, “In no event shall the annual increase in the rent be less than 4 percent.”

The flyer invites residents to come by the Wildwood Villa main office to learn about impacts to utilities, rental increases and capital improvements. 

Keizertimes spoke with Attorney Matthew G. Shepherd of Salem last year when the paper was reviewing the then-recent draft of the long-term lease. 

“You shouldn’t sign it,” Shepherd said. Shepherd advised residents of a Salem manufactured home park when they brought him copies of a contract being offered at their park. 

The long-term contracts attempts to put homeowners within the park on the hook for capital improvements, such as road and sidewalk maintenance as well as maintenance and replacement of carports. 

Shepherd believes such clauses are against the law in Oregon, but it hasn’t yet been tested in court. Submeters for individual lots are the only capital expenses that can be passed along to individual homeowners in Oregon.

Even if residents sign such leases, they are not binding and can be canceled with a 30-day notice. 

The greater threat, said Shepherd, is if all residents sign the contract agreeing to such provisions. A mix of legacy tenants and new arrivals in manufactured home parks means homeowners are operating under different lease terms. 

“Unless you have uniform leases, how do we know what each owner is responsible for,” Shepherd said.

A uniform contract gives property owners more weight in court and moving the needle in that direction is what some residents suspect is happening. 

“Trial court judges generally don’t want to get into these issues and, if there’s a long-term lease, they might hold the tenants to the signed contract,” Shepherd said. 

Another challenge is that by signing a fixed-term agreement, resident homeowners are also subjecting themselves to a different leasing terms down the line. 

“A month-to-month agreement renews automatically. A landlord can send a new agreement, but tenants can’t be evicted if they don’t sign it,” Shepherd said. “If [property owners] have a fixed term agreement, they can force another new agreement on you.”