What the Foster House Settlement Means for D.C. Landlords

Comfortable, affordable housing is hard to find in almost all urban areas in the United States, but Washington, D.C. is one of the country’s most notoriously expensive housing markets, both for buyers and for tenants.  Most of the rental units in the District are neither comfortable nor affordable.  The desirable units are out of the price range of everyone except tenants with more than $100,000 of employment income per year, plus enough financial help from each parent of each spouse to max out the annual gift tax exclusion.  Everyone else gets whichever units are available to them, and even when you figure in government subsidies for low-income tenants, the rent still takes up at least a third of the tenant’s income, especially when the prices increase even with rent stabilization laws.  To add insult to injury, many of these units are in poor condition, and landlords and tenants reach an impasse; the landlords claim, sometimes truthfully, that they cannot afford to make the repairs that the tenants are requesting, and the tenants can neither afford to continue living in their current situation nor to move somewhere else.  This month, the landlord of a building where the units were in dangerously unlivable condition has agreed to pay a multimillion-dollar settlement to former tenants and to sell the building.  If you are considering buying a rental property where the previous landlord had a rough time, contact a Washington, D.C. real estate lawyer.

District of Columbia Attorney General Sues Foster House Landlords Over Unsafe Conditions

Foster House, an apartment building in the Shaw neighborhood of Washington, D.C., previously included affordable housing units which were at the center of a dispute between tenants and landlords.  Conditions in the apartment complex deteriorated over years, decades even, and landlords did little to address tenants’ complaints.  The tenants complained about black mold, rat infestations, and other problems which made the units unsafe and which could have been fixed if the apartments received proper maintenance.  Eventually, the tenants had to move out; some of them only moved after suffering serious illnesses because of the mold.

The Attorney General of Washington. D.C. sued the two companies that own Foster House, namely Evergreen and New Bethel, for maintaining unsafe rental units which were designated as affordable housing and which received public funds for that purpose.  In October 2024, the defendants offered to pay a $1.6 million settlement, of which $650,000 will go to former tenants to compensate them for the financial losses they suffered as a result of the poor conditions in Foster House.

What’s Next for the Building Formerly Known as Foster House?

One of the terms of the settlement is that the owners of the building must sell it.  The new owners must renovate the building and rent some of the units at a low cost to tenants as part of an affordable housing initiative.

Contact Tobin O’Connor Ewing About the Pitfalls of Affordable Housing

A Washington, D.C. real estate attorney can help you resolve disputes with tenants or regulators related to affordable housing units.  Contact Tobin, O’Connor, and Ewing in Washington, D.C. or call 202-362-5900.

Source:

nbcwashington.com/news/local/rats-coming-through-my-cabinets-dc-tenants-to-get-paid-in-1-6m-settlement/3744088/