In a pre-pandemic world, clients would routinely call our office to alert us that a tenant owes one, two, perhaps three months of rent. Maybe $1,600, $3,000, or $4,500, some figure like that.
Every now and then, a client would inform us that the tenant is $20,000 in arrears and our initial reaction was, “why have you been sleeping behind the wheel?”
Enter the pandemic and a new stratosphere of rent debt. We now have an abundance of clients telling us that tenants have missed rent payments for many months and that the rent debt adds up to double-digits. For these landlords, the opportunity to recoup 80 cents on the dollar should be welcomed with open arms.
We do have several reservations about the rental assistance program. In several respects, landlords have been coerced into participation because there are scarce alternatives and the landlord is penalized for not following the program. On balance, however, it gets landlords cash flowing again and so eligible landlords and tenants should embrace it.
The operative term is eligible. Many tenants have moved elsewhere during the pandemic and abandoned the rental unit. Since renters must actually be in possession of the unit to qualify for funds, landlords who have “runaway” tenants will not be able to take advantage of the relief. Nor will tenants with high income qualify.
Sacramento gave large local governments some latitude in distributing the stimulus dollars. Cities and counties could avail the state program, have a hybrid of state and local distribution sources, or go it alone. Some municipalities have blazed their own trail.
San Francisco's Mayor's Office of Housing and Community Development is finalizing a multi-lingual online application that is aimed at assisting the most vulnerable tenants with low income and this program is expected to be launched in late April. San Francisco landlords are urged not to wait for the ribbon-cutting ceremony but instead apply for assistance at HousingIsKey.com.
In concert with our friends at the East Bay Rental Housing Association, we are awaiting further guidance on Alameda County's customized rental assistance program.
With the infrastructure in place, we suspect there will be kinks. We also hope that checks and balances are in place to prevent corruption. Yet, all in all, we are pleased that our community has the means to recover sorely needed funds.
When there are bumps along the way, Bornstein Law will be glad to assist and facilitate in the communication with tenants who will not come to the table or the relationship is otherwise taxed.
Please remain safe and please call upon us if you have any dilemmas or questions as we enter a new chapter in what has been a very trying time for rental housing providers and the professionals who serve them.