An excellent resource for everything relating to grants, loans, prohibitions and opportunities.
https://library.nclc.org/major-consumer-protections-announced-response-covid-19#content-1
On the rest of the page are some other interesting items.
This includes changes to the Fair Credit reporting act, which may impact some larger owners.
It also changes appraisal rules to allow appraisals without interior inspections and links to the agencies’ memorandums.
As an industry, rental housing providers must be present to PREVENT harmful legislation, because it is much more difficult to be made whole after the fact.
If the government does something that causes a large number of owners to fail, those owners will not have financial resources to fight back. They will be merely trying to feed their families.
This is not just bad for the owners that lost, but bad for tenants as well. In the years after the 2008 crash, there was a significant consolidation of rental ownership in Milwaukee. The city went from around 36,000 individual owners down to ~23,000 at a time that homeownership plummeted. Today Milwaukee has 41.8% owner occupancy. Nationwide that number is 65.1%.
Consolidation and owners doing what they could to survive the ’08 crisis has driven rents up significantly.
Those owners that come out of 2020 intact will likely be stronger than today. But not necessarily as municipalities will suffer more financially this go-round than in 08.
Owners that don’t fare well in the next few months will continuously be looking over their shoulders, hoping Jeff Bezos’ latest robot doesn’t take their job at the Amazon warehouse.
Or our government can keep printing trillions of dollars of new money and when end up like Venezuela where a quart of milk costs 4,200 bolivares, 11% of the monthly minimum wage. In 1990, a VEN bolivar was nearly equal to USD.
Hyperinflation, while bad for working folks, is good for those who enter it with assets and debt. Your debt remains in old dollars that you are paying off with new, cheaper dollars. Your assets acquired before the inflationary cycle will rise in value.
Look at what happened in the US during the late seventies and early eighties with annual inflation and interest rates on standard bank loans hit 18% in 1980. I was buying everything I could get my hands on. It was a risky, but good play when interest rates corrected and I could refinance at low rates like 12% APR. Yes, you can make money on rentals financed 90% at 18% APR. But you do have to pay almost nothing.
Look at average new home prices Dec 1977, when I started in real estate, $52,700 to Dec 1987 at $111,800.
Then look at historic interest rates. They were “cheap” in 1975 at 8.8% and cheap again in 1986 at 9.3% with a belly of 18.6% early 1981.
Yes, I do laugh when I hear investors fretting over half percent fluctuations in rates.
I’ll end this overly long post with there will be a huge risk to some, but also huge opportunities for others in this economy that we’ve never seen before and have no idea how it will turn out.
https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=406450
H.R. 6321 includes provisions to protect consumers, renters, homeowners, and people experiencing homelessness, including a bill from Congressman Jesus “Chuy” Garcia’s (D-IL) to place a temporary nationwide ban on landlords filing evictions on renters.
Without assistance to the property owners we will see failures and abandonment which will exceed the 2008 financial crises.
Cities like Milwaukee, with only 41.8% homeownership, will be crippled as rental property owners stop paying taxes, sewer and water. Add to that the cost incurred when the municipality has to maintain and sometimes raze tax foreclosed homes.
I had noted there was an uptick in tax foreclosures in Milwaukee hitting MLS in the last two months, that is well prior to any COVID impact.
Rental housing advocates on all sides must work together, more so today than ever, and it was important back in the BC days. (Before COVID)
We must work collaboratively with tenant advocates, whom some perceive to be on the “other” side. Advocates and rental owners are more like two sides of the same coin. You would not survive as a landlord without tenants, and tenants need the housing we provide.
There will be legislation and new rules impacting rental housing… SOON. Whether the changes will help both tenants and owners, or whether that legislation causes long term problems, will be determined by whether our voice is heard.
The Apartment Association of Southeastern WI has good people working on our behalf on these issues, Heiner Giese and Joe Murray, plus a dedicated Board and membership.
The Wisconsin Apartment Association has good people working on our behalf on these issues, Gary Goyke, and Chris Mokler, plus a dedicated Board and membership.
All four lobbyists work collaboratively with each other and with the other stakeholders regardless of political affiliations.
Legal Action and Community Advocates are working to find help for tenants so they can pay rent. Amazingly, their messages have been that tenants still must pay rent even though they cannot be evicted until at least May 27th.
These efforts to be heard and understood at the statehouse take time, energy, and, sadly, money.
You can do your part to help us help you by joining one or both groups. Not only are you supporting the industry that helps support you, but you will be in the “know” sooner than those who are not members of apartment associations.
I’ve been a member of the Apartment Association of Southeastern WI since 1989, and a board member for nearly all of those years. As of today, I am also a member of the Wisconsin Apartment Association.
Links to join:
Apartment Association of Southeastern WI
Wisconsin Apartment Association:
https://www.waaonline.org/account/create-account.php
Don’t do it for me. Don’t do it for the associations. Do it for you.;-)
We have a list of resources for people in Milwaukee whose work has been impacted by Coronavirus COVID 19.
The linked page is being updated as we receive new information. If you have any to share, please do so.
You can only show vacant units. The Governor’s order prohibits landlords from entering occupied units except for emergency maintenance.
You should not be present when showing. We need to do this social distancing thing right so more of us live and the economy returns so we can buy toilet paper and eggs.
What we (Affordable Rentals)are doing is:
