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and pray that the $5.2 billion allotted to clean up this mess ultimately finds its way into the hands of our financially struggling “landlord compadres” as soon as possible, and that more of us are helped than merely the ones whose tenants fall into the 80% or below Area Median Income (AMI) income categories. We can only hope for pressure to be placed on our tenant residents to actually take the time to participate in the application process for rental relief – please, someone in Sacramento throw us landlords a bone!
There is no secret here. The State’s rental housing providers have now suffered for nearly a year and a half with the knees of
government on their necks,
and many will not survive
much longer. Many property
owners today, predominantly
the small business, “mom and
pop” owners are seeking the
exit ramps on this business
and have been selling
out to large corporations
that will never keep intact
the affordable housing
the small owners have
traditionally provided. Many
of the smaller owners I have
spoken to have had to liquidate big chunks of their retirement savings to keep their buildings afloat or have sought a loan forbearance, and in the worse cases, been forced into foreclosure.
But beyond our “neck of the woods” here in the rental housing business, there are far broader implications resulting from government’s meddling in our housing businesses and its unilateral altering of our rental contracts we have had in place with our renters. Just the other day, in fact, I spoke to a flooring contractor that provides services to apartment owners who told me because of the moratoriums and the virtual “handcuffs” placed on landlords, his business has been down by over 20%. As a result, he has had to eliminate several positions at his company that may not be coming back for a long time if ever. Our rental housing business here in California has traditionally pumped billions of dollars into the California economy every year through employment, purchases of goods and services, and payments of fees and taxes, much of which has been adversely impacted due to Government’s knee-jerk emergency policies following the crisis of the pandemic. How many more businesses that have traditionally serviced our
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industry have laid of their workforce or gone out of business at the hands of our elected officials?
From the very beginning, none of this has ever been fair. Many of us have learned that despite the availability of rental assistance funds, the funding is coming way too slowly and, moreover, many of our renters “flat-out” are refusing to participate in the application process. Many renters either think (or willed themselves to believe) that the Government has told them they do not need to pay rent right now (or ever), or they are just “gaming the system” in hopes for a settlement down the road with a desperate landlord willing to accept pennies on the
dollar rather than being forced into foreclosure or pursuing an expensive collection claim through the jammed-up court system. In fact, many owners have reported to me seeing new cars arriving at their properties and a constant flow of packages showing up on renters’ doorsteps while at the same time, these very renters have not been paying rent. Some owners have reported to me they are friends with their tenants on
Facebook and have seen pictures of tenants posted on what are clearly expensive island vacations while at the same time, these same tenants are not paying rent.
Something seems very “twisted” about this whole situation we are in today – I should mention to you at this point that before I took this current position, I was not so sarcastic. Dealing with the unfair, literally obnoxious issues we “landlords” are forced to contend with has filled me with venom and sarcasm, sorry to say.
To add a bit of third-party credibility to the story of landlords today, a recent study conducted by a national economic consulting firm, Beacon Economics, concluded that consumer spending among “our” tenants has increased exponentially since the early stages of the pandemic. Why, you ask? It is because our tenants have been receiving Federally subsidized unemployment income and have not had to pay rent, in some cases, for more than a year. The Beacons Economics study further showed that the increased consumer spending is greatest with lower income tenants – Attention
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“Many renters either think ... that the Government has told them they do not need to pay rent ... or they are just “gaming the system” in hopes for a settlement down the road with a desperate landlord willing to accept pennies on the dollar rather than being forced into foreclosure or pursuing an expensive collection claim through the jammed-up court system.-”Daniel Yukelson