Oct 09

A good, should read, article

https://reason.com/2021/10/08/the-eviction-tsunami-that-wasnt/

The predictions were dire.

“The tragic, consequential, and entirely avoidable outcome of this ruling will be millions of people losing their homes this fall and winter, just as the delta variant ravages communities and lives,” said Diane Yentel, president of the National Low Income Housing Coalition, in late August.

“The Supreme Court failed to protect 11 million households across our country from violent eviction in the middle of a deadly global pandemic,” said Rep. Cori Bush (D–Mo.), citing one estimate of how many renters were behind on rent.

But the reality was different

“It’s going up but it’s not going up by a ton,” says Peter Hepburn, a sociology professor at Rutgers University and researcher with Eviction Lab. “You look at September relative to historic averages, that leaves eviction filings at 48.5 percent below historic averages…We didn’t see a jump up to normal, let alone a jump past normal into a giant wave of eviction filings.”

Aug 30

As the first step, the CFPB urges renters to talk to the property owner/manager.  Urging communication is important.  I would add as step two; seek mediation. 


The CDC eviction moratorium has ended: Learn your options | Consumer Financial Protection Bureau

https://www.consumerfinance.gov/about-us/blog/the-cdc-eviction-moratorium-has-ended-learn-your-options/

If you are facing eviction now, we have resources to help

Whether you are facing an eviction lawsuit or worried about getting evicted in the future, it’s important to understand your rights and what next steps you need to take.

Talk with your landlord about making a repayment plan. Find out if your landlord is willing to work with you or if they plan to file an eviction lawsuit. Here is information to start that conversation.

Talk with a lawyer, don’t delay. You may qualify for free legal help. If you’re a servicemember, talk with your local Legal Assistance Office.

Housing counselors can help you make a plan based on your situation and needs. Again, you may qualify for free help. Find a HUD-certified housing counselor.

Learn more about rights and protections based on your situation

Aug 26

Last night the Supreme Court ruled that the CDC eviction moratorium is invalid.

What should you do now as a rental property owner?

Little should change with or without the CDC moratorium. It remains in the owners’ and renters’ best interest to work together to get the ERAP funding. The only reason to evict for nonpayment at this time is if the renter refuses to apply for ERAP or does not qualify due to no loss of income. In Milwaukee or Waukesha Counties, they can apply at Community Advocates. City of Milwaukee residents can also apply at SDC

If the renter is refusing to apply, try Mediate Milwaukee or call (414) 939-8800. It will only delay for a few days and often provides superior results to eviction as renters often stay and pay. If the renter refuses this as well, then eviction is probably the only option, but it should be the last option.

Remember that in Milwaukee County less than 2.4% of eviction judgments are paid within 5 years, less than 7/10ths of 1% within 18 months. So rushing to court only stops future losses, it seldom results in recovering past rent.

Aug 05
Fox 6 Interview on mediation
https://www.fox6now.com/video/962073

Jun 05

As a rental property owner, it is in your self interest to work with the renter, secure Emergency Housing Assistance, and get the back rent paid.  If you evict, you no longer will be able to recover the unpaid rent through these programs.  

Only 7/10th of 1% of eviction judgments are paid within the first year, over five years that number is only 2.4%.   Smart money says, encourage your nonpaying renters to apply for Community Advocates or SDC ERAP funds. 

Rental Assistance Process | How to Apply for Rent Assistance | Community Advocates in Milwaukee WIor
Milwaukee Emergency Rental Assistance | Social Development Commission

There is an upside though to the moratorium ending, whether that end is next week or in three weeks, in that eviction, or the threat of eviction can be used to compel renters who refuse to apply for aid to do so.  Of course, there are also a few renters who are not paying and do not qualify for assistance because they have not been financially impacted by the COVID financial crisis. 

https://www.cnn.com/2021/06/03/politics/supreme-court-realtors-eviction-moratorium/index.html

The Realtor groups asked the justices to step in — on an emergency basis — arguing that “Congress never gave the CDC the staggering amount of power it now claims.”

They argue that the moratorium has resulted in “over $13 billion in unpaid rent per month.”

May 06

Evicting is so 2019.

You want the rent paid. The partners at the Rental Housing Resource Center have the resources to help your residents pay the rent. My company, Affordable Rental Associates, LLC, has adopted a mediation first policy as an alternative to eviction for a year now, with great success. Renters become current and do not move far more often than the court alternative.

If you are on the fence, look at how much that last eviction cost you in lost rent, repairs, court costs, time and aggravation. When it is all over, statistically you will collect less than 2.7% of your eviction judgment amounts over the next five years.

If you have questions, ask here, or email me directly.

Apr 09

HT Tristan Pettit

This WaPo article is a good read, should read piece. The bottom line is if the rent is paid evictions for nonpayment stop, eliminating the need for moratoriums.

There was a need for stopgap measures at the beginning. Today everyone would be best served by effectively using the money that is currently available to pay for the housing of people who truly are in need.

The idea is to get the money to renters before courts nationwide begin processing evictions again.

“We are running the Emergency Rental Assistance Program every day like we’re going to lose the moratorium tomorrow,” said a Treasury Department official, who spoke on the condition of anonymity to discuss the program before any formal announcements.

Washington Post The $50 billion race to save America’s renters from eviction

Mar 07

The article linked below is so wrongly anti-housing provider. If the rent is paid, the need for free legal representation disappears in most cases. Discriminatory housing policies are not those of the property owners. We want our houses full as that is the only way we make money. Instead, for the most part, discriminatory housing policies were created years ago through government programs. But now, we are being made the scapegoat by the very governmental bodies that created this mess. 

Redlining of mortgages and insurance, leading to housing segregation or worse? These were federal government-mandated rules. https://en.wikipedia.org/wiki/Redlining

But articles like the one below try to paint property owners and managers as the causation. The truth is housing and renters must succeed for the other to succeed as well. We are two sides of the same coin. There are those who profit from encouraging conflict between owners and renters. This harms both residents and housing providers alike.

Contrary to the conclusion of the article, rental assistance is the solution. If the U.S. enacted a FoodShare for Housing program, where people below a certain threshold would receive portable housing vouchers, this would change many urban American problems. Multiple studies show the costs of such a program to the taxpayer are less than what we now pay for intervention when renters fail. 

Addressing extreme housing precarity requires more than rental assistance; it requires an overhaul of the system and redress of the longstanding discriminatory housing policies that led to this moment.

https://theappeal.org/the-lab/explainers/the-american-eviction-crisis-explained/
Feb 22

[Thank you to Joe Murray for the research]

First, let me preface this that in general, I feel that Governor Evers has done well in the distribution of housing aid during the pandemic.

However, his proposed budget has a number of concerning provisions.  And how the heck does Wisconsin allows laws unrelated to spending to be part of a budget is well beyond me.

  • If passed, municipalities will be able to restrict how you screen, what you can charge, prohibit showing occupied units, making certain you lose a month or more between tenants, limit charging for damages, limit or prohibit security deposits and allow for rent abatement for minor issues.  
  • If passed municipalities will also be able to enact their own eviction moratoriums.
  • If passed, you will be inhibited from evicting for criminal activity. That should make other renters and neighbors feel safe — Not!  
  • If passed you can be required to disclose code violations “regardless of whether the landlord has actual knowledge of the violation

Actual details are below.  
—————————— 
Local landlord-tenant ordinances

Current law prohibits political subdivisions from enacting certain ordinances relating to landlords and tenants. Political subdivisions may not do any of the following:

1. Prohibit or limit landlords from obtaining or using certain information relating to a tenant or prospective tenant, including monthly household income, occupation, rental history, credit information, court records, and social security numbers.

2. Limit how far back in time a landlord may look at a prospective tenant’s credit information, conviction record, or previous housing.

3. Prohibit or limit a landlord from entering into a rental agreement with a prospective tenant while the premises are occupied by a current tenant.

4. Prohibit or limit a landlord from showing a premises to a prospective tenant during a current tenant’s tenancy.

5. Place requirements on a landlord with respect to security deposits or earnest money or inspections that are in addition to what is required under administrative rules.

6. Limit a tenant’s responsibility for any damage to or neglect of the premises.

7. Require a landlord to provide any information to tenants or to the local government any information that is not required to be provided under federal or state law.

8. Require a residential property to be inspected except under certain circumstances.

9. Impose an occupancy or transfer of tenancy fee on a rental unit.

10. Current law also prohibits political subdivisions from regulating rent abatement in a way that permits abatement for conditions other than those that materially affect the health or safety of the tenant or that substantially affect the use and occupancy of the premises. 

The budget bill eliminates all of these prohibitions.

Local moratorium on evictions

Current law prohibits political subdivisions from imposing a moratorium on landlords from pursuing evictions actions against a tenant. 

The budget bill eliminates that prohibition.

Notification of building code violations

Under current law, before entering into a lease with or accepting any earnest money or a security deposit from a prospective tenant, a landlord must disclose to the prospective tenant any building code or housing code violations of which the landlord has actual knowledge if the violation presents a significant threat to the prospective tenant’s health or safety. The bill eliminates the condition that the landlord have actual knowledge of such a violation and that the threat to the prospective tenant’s health or safety be “significant”; under the bill, the landlord must disclose to a prospective tenant a building code or housing code violation, regardless of whether the landlord has actual knowledge of the violation, if the violation presents a threat to the prospective tenant’s health or safety.

The budget bill eliminates these provisions.

Terminating a tenancy on the basis of criminal activity

Current law allows a landlord, upon providing notice to a tenant, to terminate the tenant’s tenancy, without an opportunity to cure the tenant’s default, if the tenant, a member of the tenant’s household, or a guest of the tenant 1) engages in any criminal activity that threatens the health or safety of other tenants, persons residing in the immediate vicinity of the premises, or the landlord; 2) engages in any criminal activity that threatens the right to peaceful enjoyment of the premises by other tenants or persons residing in the immediate vicinity of the premises; or 3) engages in any drug-related criminal activity on or near the premises. 

The budget bill eliminates these provisions.

Dec 20

How do landlords think unemployed people will pay rent?:

…an average of 8% of renters don’t pay rent in normal times. During the coronavirus crisis to date, that share has gone up to 15 to 20% of renters not paying.

“But generally, I think we need a better approach instead of just pitting owners versus tenants,” he says. Both the tenants and landlords need some larger, holistic fix from the government that acknowledges that there just isn’t as much money flowing through the system as there should be.

Nearly 12 million renters will owe an average of $5,850 in back rent and utilities by January, Moody’s Analytics warns. Last month, 9 million renters said they were behind on rent, according to a Census Bureau survey.   

The over $70 Billion in unpaid rent, as reported by Moody’s will cripple many housing providers and will cause a housing crisis that will impact both tenants and municipalities for years, if not decades.  In May of 2020 Milwaukee property values finally recovered from the 2008 Great Recession. 

Less than 2.5% of rent judgments are paid in Milwaukee County five years after the eviction.  And eviction judgments represent only a small fraction of the unpaid rent.  In surveying owners, we see on a high end 42% of their lost rent is included in eviction judgments, with most owners reporting less than 10%.  Some owners never pursue money judgments. So the million dollars a month in eviction judgments represent somewhere between $28.5 million to $100 million a year in money that should go into housing but does not.  I peg the number at least to be $48 Million a year in lost rent in one county.  This is just insane. 

The right answer is for the government to step up to the plate and create a portable housing voucher to cover a portion, to all, of the rent /housing costs for people below a certain income, similar to food stamps.

Instead, the government pits tenants against landlords in a zero-sum game where one must lose for the other to win. In the end, this makes housing more expensive or limits choices.

This has been a problem long before COVID. In 1991 I was interviewed by the New York Times on evictions. I asked the reporter, “On $574 a month, how do you buy tennis shoes for the kids, clean shirts for school, and still pay your rent?” Nothing has changed much since then. $574 was the AFDC (now W2) payment amount. Twenty years later in an NYT interview, my comment was basically the same:

“On $673 a month, how do you buy tennis shoes for the kids, clean shirts for school and still pay your rent?” Mr. Ballering said.” 
https://www.nytimes.com/2010/02/19/us/19evict.html 

Some suggest canceling mortgages and rents, thinking that this equivalent and will prevent the economic failure of housing.  Sadly, it will not.

The average mortgage payment is 36-39% of gross income. The average owner earns 7-9% of gross income for their investment of capital, financial risks, and physical efforts.  If you stop mortgage and rent payments, as well as prevent owners from being paid for their investment and efforts, there is still 52-57% of gross rent that is needed to cover other operating costs such as sewer, water, property taxes, maintenance, insurance, etc.

In Milwaukee, for most properties, the City takes a far bigger cut of the rent in property taxes, and sewer/water bills, than the owner gets to keep.

If you read the Brookings report, you will see this plus the “local economic multiplier” effect of wages and other monies expended by owners.

The Census Bureau reported in 2018 that, on average, every unit generates almost $1,200 in wages. Those wages, the property tax money, etc, circulate throughout the community many times over.

Here’s what scholars believe will happen if there is a moratorium without rental assistance; https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3641859 It goes into the economic impact on housing and the cost borne by other current and future tenants. It is an informative read.

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