Mom-And-Pop Landlords ‘Helpless,’ Hurt Under Eviction Moratoriums

ACROSS AMERICA — The sigh of relief heaved by millions of U.S. renters struggling with coronavirus-related job and income loss was almost audible when President Joe Biden, with the stroke of a pen, kept a roof over their heads on his first day in office.

His executive order extended a federal eviction moratorium through the end of this month.

But their relief is another group’s pain.

For mom-and-pop landlords — that is, people with small real estate holdings who depend on monthly rent payments for income or to pay their mortgages on properties — Biden’s executive order was nothing short of devastating.

The National Apartment Association estimates that mom-and-pop landlords own about 22.1 million rental properties in the United States. These landlords not only rely on rent, but they’re also more likely to absorb the costs when tenants fall behind.

That cost is steep.

By the end of 2020, U.S. renters were estimated to owe anywhere from $30 billion to $70 billion in back rent, according to a statement from National Low Income Housing Coalition.

While most small landlords recognize the unprecedented challenges devastating their renters, some are now owed thousands upon thousands of dollars in unpaid rent. Mom-and-pop landlords are staring into another year of the pandemic, knowing their financial futures and the well-being of their families are in jeopardy.

Simply put, many landlords like Clarence Hamer in New York state feel abandoned and unseen.

“Snow removal, trash — I can’t pay for it. I simply cannot. I have no money, but I’m still mandated by the city to provide proper maintenance. That is my responsibility,” Hamer told Patch. “My hands are tied, and I feel helpless. Eventually, I know I am going to lose my home.”

Across the country in California, Diane Robertson is an advocate for mom-and-pop landlords. Robertson, a lawyer by day, helped found the Coalition of Small Rental Property Owners, a grassroots group based in Los Angeles.

“What our government officials don’t seem to understand is that every time you hear about the mounting rent debt accumulated by tenants, there is a landlord on the other side of that,” Robertson said.

“We are small rental property owners. We are natural affordable housing providers,” she continued. “We are not in the business of social services, yet we are being forced to house our tenants for free, and it’s impacting us in very real ways.”

Mom-And-Pop Landlords Shoulder Rent Burden

The Eviction Lab at Princeton University estimates that before the pandemic, an average of 3.6 million evictions are filed each year in courts throughout the United States.

Once COVID-19 was declared a pandemic in March 2020, a majority of those evictions came to a grinding halt.

When the CARES Act passed last spring, it became illegal to evict tenants receiving federal assistance. Once it expired, the Centers for Disease Control and Prevention issued a new moratorium, preventing all property owners from evicting renters for non-payment of rent. The order also temporarily prohibited new and previously filed evictions from occurring.

The CDC moratorium has been extended twice since originally enacted. The current moratorium is set to expire March 31, but its future is in jeopardy after a federal judge in Texas struck down the ban as unconstitutional.

The ruling doesn’t apply to eviction freezes or rent-assistance programs instituted at the state and local levels, where many officials have stepped in on behalf of renters.

Designed to protect renters, these moratoriums do little to protect small property owners.

This is especially unfortunate, Robertson said, because while many renters are struggling to make ends meet, other renters are simply choosing not to pay.

“Landlords have absolutely no recourse right now,” Robertson said.

About 30 percent of mom-and-pop landlords in the United States are considered low- to moderate-income households, meaning they make less than $50,000 per year, according to a 2020 report by the Brookings Institution. The report also claims that rent makes up about 20 percent of these households’ total income.

Additionally, mom-and-pop landlords take on many of the expenses associated with owning and maintaining their rental properties. For a typical rental property with four or fewer units, operational expenses per unit tend to range from $4,600 to $5,400 per year, at times consuming more than half the income generated by the property.

This means when rent payments are missed, it’s much easier for small landlords to fall behind and much more detrimental to their financial health, the Brookings Institution report says.

“I know someone who had to take a loan out of her 401(k) to cover for her tenant — she shouldn’t have to do that,” Robertson said. “It really feels as though this global pandemic has been placed squarely on our shoulders, and it simply isn’t fair.”

Coast To Coast, Landlords Are Struggling

For Hamer, the owner of a rental property in Brooklyn, New York, the pandemic only exacerbated existing problems with his tenant. Eighteen months after Hamer first took his tenant to court, he still can’t evict them due to the statewide moratorium in place through May 1, he told Patch.

Hamer is now owed more than $53,000 in back rent. In all, he’s behind nearly $60,000 in overdue mortgage payments, city fines and other fees.

Hamer became a landlord in 2019 when he rented out his Brooklyn home after moving to upstate New York. He views the Brooklyn home as an investment property he hopes to one day pass on to his two children.

But by October that same year, Hamer had taken his tenant to Kings County Civil Court for unpaid rent.

After several court appearances and mediation, Hamer’s case came to an abrupt halt in March 2020, when most eviction proceedings in Kings County were postponed.

He hasn’t been in court since, he said.

And he likely won’t see a day in court until at least May 1, when a statewide eviction moratorium placing a stay on most evictions expires.

Meanwhile, Hamer’s tenant changed the locks, prohibiting his access to the property, he said. They haven’t paid rent in months, Hamer added. He also said he believes the tenant is now subletting rooms to others.

Throughout the ordeal, Hamer said he’s received no rent payments and no relief from New York City, Kings County or the state of New York. His tenant also doesn’t qualify for any state relief programs, he added.

Meanwhile, his mortgage company is making “embarrassing” calls to his home and his place of unemployment.

“They are more than requesting the funds,” Hamer said.

On the other side of the country, mom-and-pop landlords are facing a similar plight. Darlene, who asked Patch not to publish her last name due to fears of retaliation, owns a rental property in California. Only one of her two tenants is current on rent.

Darlene’s rental property is a home she inherited and has been in her family for decades. For Darlene, who’s in her 70s, the property now serves as an income source.

On March 1, Darlene’s tenant owed her close to $18,000 in unpaid rent, she said.

In California, Gov. Gavin Newson on Jan. 29 signed legislation that extended the state’s eviction moratorium through June 30. The state has in place some of the nation's strongest renter protections. While tenants are still responsible for paying back rent to property owners, those unpaid amounts cannot be the basis for an eviction, even after the moratorium ends.

“It’s hurting me,” Darlene said. “I’m trying to pay the bills, the water — whatever the city wants, but I can’t go to work to make up the difference. I blame the government for putting me in this place. I can be mad at my tenant all day long, but they’re not the ones who put landlords in this situation.”

Robertson founded the Coalition For Small Property Owners just a week after Los Angeles Mayor Eric Garcetti issued a citywide eviction moratorium in March 2020.

“A friend and I were talking about what we would do if our tenants stopped paying rent, and neither of us had an answer,” Robertson said.

The group was born from the conversation. What started with seven members has since grown to more than 140 small landlords, most of whom own properties in Los Angeles. The group is also primarily composed of Black property owners.

What started as a support system has evolved into advocacy as members work to educate lawmakers on the effect moratoriums are having on small landlords.

Property owners can learn more about the coalition and how they might contribute to its advocacy here.

“It’s far more common to read about the plight of tenants — those groups historically have been much louder,” Robertson said. “For a variety of reasons, landlords have been more passive and quiet, but I do think that is changing now with everything we are being beset with. Groups like ours are really important to shed light on the fact there’s another side to this story.”

For the coalition, the “other side” is a group of landlords who don’t necessarily have pensions or 401(k) plans. They didn’t invest in the stock market. Instead, they bought a rental property and planned to live out retirement on the income it provided.

Now, their future is in peril, Robertson said.

“We simply can’t sustain what we’re being forced to do. It’s untenable,” Robertson added. “We are being forced to house our tenants for free. I can think of no other business that’s being forced to provide a product or service for free because their customers can’t afford it.”

Is Help For Landlords On The Way?

The $1.9 trillion American Rescue Plan, passed by the House on Feb. 27 and currently under debate in the Senate, does not include an extension of the eviction moratorium. It does, however, provide $30 billion in additional funding for emergency rent relief to renters who qualify. The aid adds to the $25 billion in emergency rental assistance provided by a relief bill signed into law in late December, according to an CNBC report.

Still, the possibility of more renter relief provides no comfort or sense of security to those Patch spoke with for this story.

Darlene said she’s luckier than most because her mortgage company is working with her on the missed payments due to non-payment of rent. However, she wishes the government would put in place policies and rent relief programs that look at renters on a case-by-case basis and provide payments directly to landlords rather than tenants.

“Payments should go directly to the landlords to make sure things get paid,” Darlene said. “None should be going to the tenants.”

Meanwhile, Robertson is fearful for the future of small landlords and the role they play in providing affordable housing to their communities. She’s also anxious about the effect it’s having on Black homeowners and other landlords of color.

“We have a member who has a single-family home that’s been in her family for 50 years. Her tenants stopped paying immediately after the moratorium was put in place, and now she’s decided to sell this home that’s been in her African American family for years,” Robertson said. “Home ownership is one of our greatest pathways to financial security and generational wealth, and that’s being threatened.”

Meanwhile, landlords are still calling on lawmakers, hoping to see relief of their own.

For now, all they can do is wait.

During a recent landlord protest in New York City, Hamer carried a sign that read, “justice delayed is justice denied.”

“Stop denying justice,” Hamer said when asked what he would say to lawmakers. “If you don’t set up consequences, do you think people will follow the rules? If you don’t pay your car or your cell phone bill, they will cut off your service. This is just a consequence.

“There is right and there is wrong, and this is wrong.”