What Eviction Moratoriums Are Doing to Small Landlords
COVID-19 has changed the lives of people around the world. It has also changed the way a lot of businesses operate.
A lot of people have talked about how COVID-19 has hit certain businesses especially hard. People mention the hardships retail workers, nurses, and restaurant workers have faced, but there’s one group that’s been drastically affected by COVID-19 that isn’t getting a lot of press, small landlords.
Eviction moratoriums have been put in place to help avoid a national eviction crisis. This may have helped certain renters, but it’s caused trouble for smaller landlords. Sadly, most people have been particularly unsympathetic to landlords during this difficult time.
Let’s take some time to discuss the current situation for landlords and what they can do to protect their interests.
The Moratorium Decision
Before we discuss the effects the moratorium has had on landlords, let’s take a moment to look at the rationale behind them.
Did you know that around 36.6% of Americans rent their home? That’s a little over 1/3rd of the entire country.
When lockdowns occurred, people weren’t sure how long they’d last or how people’s jobs would be affected. As a response, the unknown lawmakers on both the state and national level decided to impose a temporary moratorium on evictions in order to avoid a housing crisis during the pandemic.
Unfortunately, it’s clear that the pandemic is lasting much longer than lawmakers assumed it would. Now renters and landlords are locked in a stalemate for evictions. People aren’t making payments and may not have the means to do so for a while, but landlords are powerless to evict them.
Eviction Moratoriums and the Small Landlord
The decision to put a ban on evictions is having unintended consequences, and the worst seem to be affecting landlords that only own a few properties.
One issue surrounds relief. There have been talks for loans or aid for landlords that aren’t able to collect rent, but the path to get relief can vary from state to state and isn’t clear on a national level.
Wealthy hedge fund managers and real estate firms have lobbyists in Washington that can fight for them. It’s estimated that the wealthiest stand to get over $100 billion in tax breaks because of the CARES Act. A lot of small landlords are getting left behind in the push for aid.
Another issue comes from interpersonal relationships. It isn’t unusual for smaller landlords to get to know their renters.
Some landlords may feel reluctant to bring up late or missed payments because they empathize with their renters and have personal ties to them. They also understand that some of their renters have been put in a difficult situation and would pay if they had the ability to.
Overall, the current moratorium has put small landlords between a rock and a hard place. They’re not getting any relief from the government, they’re put into an awkward situation with their renters, and they don’t have many options to resolve things.
How to Weather the Moratorium Storm
Small landlords don’t have a lot of good options right now. They don’t have the option to evict delinquent tenants, and they aren’t getting the help they need from the government.
Your options may be limited, but there’s still plenty you can do to survive the current crisis. If you’re a small landlord that’s being impacted by current eviction protections, make sure that you follow these tips.
- Follow the News
There have been talks about potentially banning security deposits and making other changes to help renters, but it’s important to keep in mind that certain ideas may not come to pass.
Legislation around COVID-19 relief and protections is in a constant state of change. One of the best things you can do during this crisis is to stay up to date on what’s happening on both a national and local level.
Beware of misinformation around anything that focuses on pandemic relief. Only believe information if you read it on a government website and don’t take any actions until you confirm that you heard information from a reliable source.
- Find a Lawyer
Nobody can know for sure when the moratorium will be officially lifted. When that time comes, you’ll want to make sure that you’re prepared for whatever happens next.
If you don’t already have one, take the time today to find a lawyer that specializes in real estate. Don’t make the mistake of waiting to do this. Once evictions lift courts will be backed up and good help will be hard to find.
A lawyer can help you navigate any eviction situations the right way. They’ll also be doing their part to stay up to date on the latest laws, so you’ll have someone knowledgeable on your side.
- Work Out a Deal
Eviction should always be treated as a last resort for all landlords. Many of you reading this probably have had mostly positive relationships with your renters. They may not be able to pay you in full now, but you can take the time to work out a potential deal to alleviate stress for both of you.
See if your renter is willing to pay a small portion of their rent for the time being. Consider working out a payment plan to get them caught up once they get back to work.
Remember, it can be hard to find good renters, and that’s especially true during a pandemic. Most small landlords will be better off finding a way to work with their tenants that have fallen on hard times.
Get a Good Partner on Your Side
Eviction moratoriums have put a lot of small-time landlords in a difficult place. Times are tough, but there are things you can do to protect your property and your rights.
During times like these, you’ll want to ensure that you have the right people on your side helping you out. We’re helping plenty of landlords navigate the difficult times COVID-19 brought, and we’re ready to help you.
Do you want to know how we can help you and your renters? Contact us today so we can start a conversation.
