From $30 a day sounds cheap. Â $930 a month not so much so.
A concern, as raised on the ApartmentAssoc@Groups.io discussion board is – does this expose the owner to sales taxes?
Author: Tim Ballering
A tsunami, an avalanche, a flood, a pandemic, and now a cliff of evictions.
No wonder no one tries to fix the root causes… some see it as a natural disaster, rather than something that with diligence can be fixed in a manner that is good for both tenants and housing.
When Desmond started, he had a great goal – universal housing vouchers, similar to food stamps, for people in need. But along the way, Matt was abducted by the Eviction Defense gang, a zero-sum game where individual tenants have small wins at the expense of the greater good for all tenants and housing.
Rather than eviction “defense,” which harms other tenants and housing by passing the cost burden to both, the better solution is eviction “prevention.” Even the recipients of the eviction defense come out of it with damaged rental histories. Excluding the attorneys, there are no long-term winners, only multiple losers.
Often eviction defense results in a tenant being able to stay for an extra month without paying rent. I wonder if there would be similar or better results if the money spent on eviction defense attorneys is used to pay a month or two of rent.
How many tenants have multiple evictions, or move without fulfilling their rental agreement every few years? Some get parents and friends to “front” for them as they cannot obtain housing independently from property owners. Others seek out small owners who do not know how to screen or go to owners who don’t care as long as they have a fist full of move-in money.
Prevention needs to occur before the rent is missed.
People at the bottom rung of the income scale will always have problems paying rent unless there is something like rent vouchers to help. What other societal costs could be reduced if the constant moving were to be reduced? I think there is a significant safety factor in knowing your neighbors, making it more likely you watch out for one another. What is the impact on schools as kids move, not just due to housing, but also utility disconnects? And so much more.
As I have said to Desmond in the past, I fully support his universal housing vouchers and am willing to work hard to promote it.
The numbers of people at risk of going over this “evictions cliff” are staggering: Data collected by the U.S. Census Bureau indicates that between 43 and 45 percent of adults live in renter households affected by recent job or income losses, and nearly half of all renter households were struggling to make ends meet even before the virus hit. A UCLA analysis projects that in Los Angeles County alone, about 120,000 households—including 184,000 children—are likely to experience homelesseness, and Black, Latinx, and poor families will suffer the most.
Having a lawyer in housing court can give tenants facing eviction a fighting chance: A March 2012 Boston study, for example, found that about two-thirds of people in the group with full-service representation were able to keep their homes, compared to one-third in the group that received more limited legal help. In Seattle, the King County Bar Association’s Housing Justice Project found that tenants with counsel are more than three times as likely to avoid a forced eviction executed by the local sheriff’s office and reach an out-of-court agreement with their landlord. When the agreement includes a payment plan for catching up on rent, tenants remain housed nearly two-thirds of the time.
Categories
Fireworks and Fires
We may wish to address the impact that fireworks have on housing and insurance before 2021.
There were 140 reported fires over the Fourth of July weekend 2020 (07/03/2020 to 07/05/2020 inclusive)Â
The same period last year (07/03/2019 to 07/05/2019 inclusive) had 60 reported fires. Â
Even when you include the weekend after the 2019 Fourth (07/03/2019 to 07/07/2019 inclusive) there were 81Â fires reported
MPD/MFD fire callsÂ
07/03/2020 to 07/05/2020 140 Â (3 days)
07/03/2019 to 07/05/2019 Â 60 Â (3 days)
07/03/2019 to 07/07/2019 Â 81 Â (5 days to include the following weekend)
Below is the letter the Apartment Association sent to Mayor Barrett, President Johnson, and the Common Council on June 15th, 2020. We have yet to receive a response, but still hopeful that those representing housing providers are included in designing a meaningful solution to these problems
Dear Mayor Barrett
We are pleased that Milwaukee is considering offering financial help for tenants who are struggling to pay rent, and we would like to be a part of the process. We have been working with a coalition that includes Community Advocates, Legal Action, Legal Aid, and Mediate Milwaukee. The AASEW can bring valuable experience and insights to this effort, and we hope you will strongly consider our offer to participate in your deliberations.
While we applaud Governor Evers’ $25 million Wisconsin Rental Assistance Program, it represents approximately $30 of assistance per rental unit in Wisconsin. We believe the size of the rental population in Milwaukee and the financial fallout from the COVID-19 pandemic may necessitate a more robust response.
In our view, sustainable rental housing is critical to the well-being of Milwaukee. Nearly six in ten, 58.2%, of Milwaukeeans live in rental housing.[i] In some neighborhoods, such as 53233, the number of renters exceeds 97%. The success or failure of neighborhoods and rental housing are closely tied. Currently, Milwaukee offers some of the most affordable metropolitan rents in the nation, a significant advantage compared to similar-sized communities in the country.
However, if landlords cannot collect rents and continue to cover the operating expenses for their properties, the impact could be worse than the 2008 housing crisis. “The economic impact of the Great Recession and mortgage foreclosure crisis has had a significant, detrimental, and ongoing effect on City households.” DCD 12/2019.[ii] Foreclosure filings in Milwaukee County were three times higher in 2009 than last year.[iii] From 2008 through 2010,16,000 Milwaukee properties were in some stage of foreclosure by lenders and the City.[iv] In those two years, the tax base lost almost $2 billion in value, with a resulting $16.7 million loss of tax revenue. The resulting demolitions had a large impact on the City’s budget due to the cost of razing along with the impact on the property tax and municipal services collections.[v] The neighborhoods where those properties were located suffered long-term damage. We continue to feel that impact even today, and we certainly hope to avoid a similar outcome in the future.
Rental Housing is the largest small business in Milwaukee, with over $10 billion[vi] invested in the City. Rental properties account for more than $700 million dollars per year of economic impact, starting with $270 million[vi] paid in property taxes.
In 2018, the Census Bureau found the yearly mean operating costs, excluding mortgage payments, per unit for rental properties was $5,270. [vii] Milwaukee’s rental housing contributes $1,198 in wages per unit, $161 Million per year. But more than direct wages are involved. There is also the local multiplier effect because the wages paid to employees of Milwaukee landlords are a major economic factor in the well-being of the City and its residents.
These numbers highlight the critical importance of a healthy and vibrant rental housing market in Milwaukee. We hope you will accept our offer to participate in the upcoming process to deal with the fallout from the COVID-19 pandemic and Eviction Moratorium this year. Thank you for your consideration, and please feel free to use the contact information above for any clarifications or questions you may have.
Sincerely,
Ron Hegwood
President
Apartment Association of Southeastern WI, Inc
[ii]Section 2: Housing Needs and Demand Housing Affordability Report Department of City Development | December 2019
[iii] State’s Foreclosure Rates Have Plummeted » Urban Milwaukee
[iv] www.sewrpc.org/SEWRPCFiles/HousingPlan/Files/foreclosure-in-milw-progress-and-challenges.pdf
[v] Tom Barrett wants to spend $2.4 million on home demolition, rehab
[vi] MPROP assessor records April 2020
[vii] https://www.census.gov/data-tools/demo/rhfs/#/?s_byGroup1=12&s_tableName=TABLE4
Landlords argue that they are unfairly being forced to absorb the brunt of the financial burden of pandemic job losses. “Why isn’t food free? Why isn’t clothing free? Why aren’t all the other necessities of life free, yet shelter is being made free?” said Sherwin Belkin, a legal adviser for the Real Estate Board of New York, which represents property owners.
The government, he said, should provide vouchers to tenants who cannot pay rent because of the pandemic, and landlords should be allowed to use the courts to evict those who still do not pay. “Something is wrong when a private industry is being asked to take on its back what is really a public housing emergency,” he said.
One troubling number that is underreported is Milwaukee has had 72 homicides YTD 2020, compared to 43 YTD 2019, a 67% increase.
Similarly, Chicago has seen record homicides. They had 18 shooting deaths in one 24 hour period, with 329 people murdered in the first six months, which was “only” a 34% increase over last year. Shootings in Chicago were up 75% in June, with murders up 78%.
I think we can all agree that even one murder is too many unless the victim is on Arya Stark’s list (GoT) “Joffrey, Cersei, Walder Frey, Meryn Trant, Tywin Lannister, The Red Woman,…”
On the Apartment Association email discussion board (free and open for anyone to join) there was a comment that the reduction in evictions “Seems obvious since couldn’t evict for 3 months.“
Yes, it was obvious to those of us actually involved in housing.
But, some folks and the media were predicting a “tsunami” of evictions after the moratorium ended May 26th that would push us way past prior-year eviction counts in a single month.
For example, the Journal reported: “Predicted surge comes true: Eviction filings jump over 40% in Milwaukee County and state” citing a single week over week increase, using the first week that most evictions could be filed after the moratorium.
Owners are working with tenants more now than ever.
Groups such as the Apartment Association of Southeastern WI and the WI Apartment Association are working with Community Advocates and Legal Action to find resources to help tenants pay rent in ways never seen before.
Both “sides” understand that owners need their tenants to succeed for owners to remain viable, and tenants need owners to succeed for housing to remain available and viable.
My company has pledged to attempt mediation before eviction and waived late fees beginning in April, a month before the moratorium.
We need to remain vigilant as the true economic crisis may come later this year if the economy doesn’t rebound and /or the virus does. Regardless of your political leanings, the one thing we can all do is wear masks in public. If they do work, and I believe there is a value in wearing masks, then wearing a mask will keep infection rates down and allow businesses to remain open. If mask does not work, no harm, no foul.
[Updated 7/3/20: The original count increased slightly (~1%) after June 30th due to evictions filed towards the end of the month, but not posted to CCAP until July. These appear to have been paper filings. While the change is insignificant in the overall impact, I wish to be as accurate as possible. ]
Evictions for the first six months of 2020 are down 32.1% in Milwaukee County over 2019, and down over 30% statewide this year over last.
The NYT article is title is “Lori Lightfoot, mayor of Chicago, on who’s hurt by defunding police.” But it has a lot to do with rentals from what I perceive as a very liberal politician’s view.
I would take the Chicago Housing Solidarity Pledge as it is what my company is already trying to do.
From the NYT’s article interview with the Chicago Mayor:
As a result of what we’ve all been going through, a lot of us, I think, have been reconsidering some of the fundamental assumptions we had about our government and economic system. Have you? Are you thinking differently now about things like rent control? [6]
When I think about rent, I think about it in the context of the entire ecosystem. The problem is mortgages that have to be paid and the banks that hold those mortgages and whether they’re going to give any forbearance. I think about landlords who are under pressure to pay their mortgage, their utilities, their property taxes. I think about renters and how stressed they are, worrying about being able to pay but also about possible evictions and what impact that is going to have on their credit rating. So the way I think about public policy is not individual levers and solutions in isolation. I try to look for the balance. Many times, there’s a solution lurking in the center.
So where might there be a solution for helping people who are struggling to pay rent because the economy cratered?
One thing that we did here is we brought together banks, landlords and people representing renters into what we called a solidarity pledge.[7] It’s voluntary; it’s not mandatory. But we put a lot of emphasis on saying: “Be good neighbors. Give each other grace and space in this difficult time.” That means not filing evictions. Not penalizing people because they can’t pay their mortgages or their rent. Be engaged in conversation to find common ground. We heard from all the actors that they were engaged in a lot of these conversations already. But by me, as mayor, publicly challenging them, it moved a conversation that was in the backroom to a more public reckoning.
Don’t you think that a voluntary “solidarity pledge” could just give landlords the cover of paying lip service?
You’re underestimating the level of activism here in Chicago. Any instance in which people feel there’s been a deviation, they are not hesitating to call it out. But of course, not everybody’s taking the pledge.
————
6 Rent control has been banned in Illinois since 1997.
7 In addition to the solidarity pledge, Lightfoot recently proposed a prohibition on landlords’ eviction of a tenant without first allowing the tenant five days to deliver a “notice of Covid-19 impact” outlining financial hardship brought on by the pandemic. Delivery of the notice would then earn tenants an additional week for negotiation.
The House plans to vote next week, possibly Monday, June 29th, on the “Emergency Housing Protections and Relief Act of 2020” (H.R. 7301).
This bill contains both emergency rental assistance,(good for housing) and a national eviction moratorium regardless if the owner has federal financing.(Very bad for housing)
https://rules.house.gov/sites/democrats.rules.house.gov/files/BILLS-116HR7301IH.pdf
Easy reading at ONLY 92 pages…