Nothing is certain in the time of COVID-19. With cases skyrocketing in parts of the US and federal rent protections ending soon, we’re seeing millions of out-of-work renters being forced to contend with the real possibility of an impending eviction. To make matters worse , the pandemic has complicated the process of finding a new home in general, with physical apartment tours posing serious threats of spread and contamination.
When confronted with confusion and discord, it’s always best to turn to the experts, and that’s exactly what Janet Portman and Ann O’Connell are. Aside from informing and authoring a lot of the content on the invaluably comprehensive Nolo.com, they also have years of direct experience with landlord/tenant law under their belts, with Janet serving as a public defender before becoming the site’s Executive Editor and Ann working as both an attorney and real estate broker. We called up the two to get their takes on the pandemic and all of its unruly consequences, from the new normal of virtual tours to the intensified strain between landlords and tenants as everyone struggles to keep themselves financially stable.
ApartmentRatings: Thanks so much for chatting with us today. We’ll just get started with a big question right out of the gate. Who do you think has it harder right now (landlords or tenants)? Why?
Janet: (Laughs) That is a big question! It’s also a very tricky one. The real answer is that it just depends. On the one hand, you have millions of tenants facing the prospect of real hardship. There are no laws in place to guarantee permanent rent reduction, and when landlords do offer to help, it’s usually in the form of postponed rent. That might be okay for the first month or two, but eventually they’re still going to have to pay the full amount when the landlord decides to lift the postponement. And then the flip side of that is the fact that landlords aren’t receiving any money, either.
Ann: Yeah, what Janet said is true, it’s really different from place to place. And in the short-term at least, I might actually caution to say it’s the landlords who have it harder. There’s this widely-publicized conception that because the landlord is the one collecting money, they’re automatically the bad guy in every situation. And a lot of that comes from the news outlets who are quick to report an instance where a landlord has been treating their tenants unfairly, but not so much the other way around. The reality is that a lot of property owners out there are what we call “accidental landlords,” or people who came into property ownership by way of an unforeseen circumstance like the death of a loved one.
J: And for people like that who are struggling to stay afloat, my only advice would be that even a little rent is better than no rent. Because if you’re not going to be empathetic towards your current tenants, who are you going to get to fill the units? Suddenly you have these apartment buildings that are now not affordable by the very people who used to rent them. Where do those people go now?
So is the immediate answer to say “okay government, now you build us some more.” Well, no, the answer might be “let’s support the small business people, the landlords, so that they can keep these properties in the market and continue to rent them to the painters, bus drivers, childcare givers, the people that we depend upon in our communities who by necessity have to live near by. And if they don’t live nearby, are you willing to have them parking on your street in their RVs. That’s what’s happening.
It’s a terrible situation and it really would require some very thoughtful, strong, smart leadership from the federal government, which sadly is totally lacking.
AR: You touched on “accidental landlords” and other property owners struggling right now. What can those people be doing right now to stay afloat?
J: I think it sort of goes back to what we started with, which is to get real. If you’re going to take a hard line against your tenants, you’d better be sure that you can replace them. In other words, look at the whole situation. Can you work with your bank to modify your loan so that that rent stream isn’t as critical as it otherwise would be? Can you work with your tenants to have them pay at least some of the rent every month?
If you’re a small business person – we’re talking about smaller landlords now – who theoretically are eligible for the Paycheck Protection Program, which includes using the loan (if you get one) to cover the cost of your employees and keep your rentals in good shape. It doesn’t however — and this is a very important point — you would not be able to use that money to cover unpaid rent. Not at all. It’s really a matter of using it to keep yourself out of default on your own loans. So it could be used to cover the loan on the property that’s now not generating rent.
To give you sort of the big picture, it’s to realistically assess your financial situation in light of the length of time this is probably going to go on. Weigh the consequences of every option you consider, and then, having considered the options and the consequences, pick the best one. The one that has the least amount of pain. And when I say “the least amount of pain,” hopefully people are considering the pain suffered by their tenants, as well.
A: One other thing landlords could do if they own a condo, for instance, is to talk with the local homeowners association and see if they could get a hold put on some of those dues. I’m based in Colorado, and I know that many of the HOA dues here are between $400 and $500 a month. If a landlord can get the HOA to work with them, perhaps they can cut the rent back $500 a month for the tenant.
Little things like that, even your insurance perhaps…whatever sort of breakdown a landlord has on their monthly payments, if they can think about how to parse that out and see if there’s any way at just whittling away at that (laughs), then they should try to do that.
AR: Before we go, we wanted to be sure to allot some time to give the floor to you. Is there anything we haven’t touched on yet you feel it’s especially imperative for the rental community to know at this time?
A: You asked earlier about ways landlords and tenants can work together. Especially for smaller landlords, if they have even a decent working relationship with their tenants, if both sides can check in with one another, and tenants don’t necessarily assume their landlord is doing just okay or fine…there’s potential there for both sides to share resources, and help each other find the resources they need to help them out. Say you’ve got a landlord who has a full-time job and is just overwhelmed, and has three kids at home but their tenant is a single person who doesn’t have as much going on — maybe they can do some research! (laughs). And help each other out. And there are resources, but sometimes it’s hard to find, or even to take the time to take a breath and say “how can i help myself and my landlord/tenants?” So to the best that people can work together to help each other out, the more beneficial.
J: The other piece of advice I would direct to the larger landlords is that you might win in the court of law eventually if you figure out what’s going on and play your cards right, but the court of public opinion is going to be possibly just as important, and it’s really something you should think about. If you get a reputation in your neighborhood or town as somebody who was a real jerk, basically — somebody who refused to work with tenants — all the marketing in the world is not going to overcome that bad PR. It’s something to keep in mind.
This interview has been edited and abridged for clarity.