What your landlord thinks about rent right now

When Chris Athineos says that current events present an unprecedented challenge to landlords, he speaks with some authority. He manages a family business, founded by his parents in 1968, that now owns and operates 150 units in apartments across the Brooklyn Heights, Park Slope, and Bay Ridge neighborhoods in Brooklyn, New York.

“It’s frightening, we’ve never had a crisis like this,” he says about the economic fallout from the novel coronavirus. “We haven’t felt the effects economically yet, but I’m sure everybody will. I’m trying not to panic.”

Athineos, who’s also the executive director of Small Property Owners of New York (SPONY), a nonprofit representing the landlords who own smaller buildings with fewer than 100 units, says that the pandemic has changed how he and other landlords manage their buildings. Elevators are restricted to one person or family at a time; high-touch areas, such as compactor chute handles, doorbells, and elevator buttons, are cleaned constantly; appliance repairs, especially for overstuffed refrigerators, are taking on new urgency.

It’s also raised questions of how landlords will cover their own expenses during a prolonged economic pause, as an increasing number of newly unemployed tenants will struggle to pay rent. According to the National Multifamily Housing Council, 69 percent of Americans paid their rent by April 5 this year, a drop from 81 percent last month and 82 percent in April 2019. Data gathered by Avail, a company that sells software geared towards smaller landlords, found that there were 50 percent more instances of unpaid rent in April compared to March. In addition, in a survey of 7,500 renters, 54 percent said they already lost their jobs due to COVID-19, a rate well ahead of government joblessness reports. Of those, 34 percent said they weren’t planning on paying April rent.

Many multifamily property owners will soon be faced with maintenance and operations costs, mortgage payments, and property taxes they themselves may struggle to pay without rent checks coming in, leading to additional strains on banks, lenders, and the larger mortgage market.

Mortgage forbearance means many of these property owners will be allowed payment deduction or deferral on mortgages for as long as a year if they’ve lost income or employment because of the novel coronavirus fallout. Housing and tenants’ rights advocates say that renters aren’t being given the same flexibility, even with the eviction and rental moratoriums that have been put in place in some locales, and need more support. Some have started to call for large-scale rent strikes in the run-up to May 1.

In New York City, Housing Justice for All, a coalition of advocacy groups, has requested the state freeze rent, and some advocates are even calling for rent suspension; State Sen. Michael Gianaris introduced a bill calling for a 90-day rent suspension.

“I think it’s pretty unfair for the half of the state that rents that a similar measure [to mortgage relief] hasn’t been put forward,” Cea Weaver, campaign director for Housing Justice for All, told Curbed New York. “It’s really important at this moment as New Yorkers lose income that we also don’t lose our homes.”

But landlord groups and economists say that amid a crisis that affects everyone, it’s still important to keep the needs of landlords in mind.

Ultimately, even amid all this uncertainty, landlords don’t want to lose their tenants, according to Jeff Cronrod, who represents the American Apartment Owners Association (AAOA), the nation’s largest landlord trade group. Members of the group have been calling him anxious about mortgage payments and property taxes coming due, but “nobody wants to talk eviction.”

By and large, landlords are most worried about issues of rent and cash flow. During a webinar held in late March for AAOA members, “Coronavirus and Landlords: Effects on Evictions, Assets, and Liability,” the sentiment from the hundreds of members who listened in leaned toward financial issues (a vast majority of submitted questions were about what to do if tenants stop paying rent, and how to set up a payment plan for deferred payments). One of the presenters, Brad Barth, partner at BarthCalderon LLP, a law firm in Orange, California, advised landlords to speak to their lenders and devise mortgage payment plans. Steven Williams, a lawyer for Fried & Williams, advised landlords to make sure they’re up to date on insurance and liability coverage. He also pointed to the spring breakers flaunting coronavirus restrictions, warning landlords that they may be sued if tenants act recklessly and facilitate transmission.

— read full article here: https://www.curbed.com/2020/3/31/21197368/coronavirus-rent-mortgage-landlord-apartment