Now that the CDC’s eviction moratorium, initially ordered on September 1, 2020, has been extended until March 31, 2021, many landlords are becoming increasingly frustrated and concerned about being able to continue making all necessary payments to maintain their properties.
The moratorium has the important goal of reducing the spread of the COVID-19 virus by helping to ensure that individuals that have lost their income don’t also find themselves without stable housing. While helping to keep unemployed workers from becoming homeless is obviously an important objective, there are some flaws in the eviction moratorium that put an undue burden on landlords, especially small, or “mom-and-pop,” landlords.
Problems with the Eviction Moratorium
There are a couple of key problems with how the federal government has dealt with eviction moratorium that has led to disproportionate and unfair impacts on landlords.
The first is that there is no relief provided for landlords. While tenants are given a respite from payments, landlords are not provided the same protections. They are still responsible for paying maintenance costs, taxes, insurance, and mortgages. Without any sort of relief or support, this can leave many landlords, especially smaller ones, struggling to maintain their property.
It’s worth noting that the stimulus package that is currently before Congress includes $25 billion in rental assistance, which, if passed, could help to provide some support for both tenants and landlords. However, many critics argue that this relief will be both too little and too late to provide meaningful relief for struggling tenants and landlords.
The second major problem with the eviction moratorium is that it’s a one-size-fits-all solution that doesn’t take into account the impacts on individual landlords. While the moratorium might not have much of an impact on large real estate firms or hedge fund investors, for smaller landlords it can be disastrous.
The reality is that many landlords are going to have to use their retirement savings, go into debt, or sell their property to make it through this crisis. While everyone has been impacted by the pandemic, the eviction moratorium, as it currently stands, seems to place a disproportionate burden on landlords.
What Landlords Can Do About the Eviction Moratorium
Despite the flaws in the eviction moratorium, it is here to stay until at least March 31, 2021. For landlords that are being impacted by the moratorium, there are some things that can be done to help weather this storm.
First, remember that the moratorium only bans evictions of tenants that are making their best efforts to pay but are unable to do so because of a substantial income loss. It does not ban evictions of tenants that breach the lease for any other reason.
Second, the moratorium does not relieve tenants of the responsibility of paying rent. That said, the reality is that when the moratorium is lifted, it’s unlikely that tenants will have a lump sum of cash to pay all of the back rent that is owed. To help with this issue, landlords should work with tenants to come up with payment plans that ensure that tenants are staying as current on rent as possible. Additionally, in some states, landlords can sue tenants for rent in small claims court. This means that they’ll have a judgment against the tenant for unpaid rent and have a better chance of recouping missed rent once the tenant is working again.
Third, it’s important that landlords stay up to date on the current state and federal laws as well as any opportunities for relief. Doing so ensures that landlords are complying with all relevant laws while also ensuring they’re taking advantage of all favorable provisions or relief measures.
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