The goal of the moratorium on evictions is to protect financially vulnerable renters from homelessness during these tough economic times. However, without the ability to remove non-paying tenants, some landlords feel a new kind of anxiety that they never saw coming.
An unforeseeable risk for investment properties
The appeal of a residential rental property is undeniable. If the building is in fair condition, it is a safe, steady way to build equity and earn rental income. While every property owner has headaches, the benefits vastly outweigh the difficulties.
The coronavirus pandemic upended that revenue model. Many smaller landlords, those with one or two rental properties, now find that they’ve lost the ability to pay their multiple mortgages. In one notable case, a property owner reports that her tenants refused to pay their rent and mocked her over the situation.
What does this mean for renters and landlords?
As of this writing, on April 1st the moratorium on evictions ends. No one knows what will happen at that point. What we do know is that the recently passed stimulus package includes 25 billion for rental assistance. That amount equals what is own collectively in back rent, but dispersal across the county and here in Illinois has been stalled.
When the moratorium ends, there’s likely to be a “rush” on eviction notices. That rush might stress the system in unexpected ways causing further issues.
Fears for the future
Owners of rental properties had no way of seeing the coronavirus pandemic coming. However, now that it has come, they will have to worry about something like this in the future. Some expect that landlords will raise their requirements for credit history and backgrounds for new tenants as a response.
Whatever the future, property owners of all sizes will need to assess their legal options to protect their investments against possible future catastrophes.