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The Unseen Costs Of The Extended Eviction Moratorium

Governor Newsom’s executive order protects tenants over landlords to rapidly worsening results

By Evan Symon, July 2, 2020 5:41 pm

Following Governor Newsom’s eviction moratorium extension executive order on Tuesday, thousands of landlords across California are now facing severe financial strain. With two months added on to the moratorium on top of several months of not being able to remove tenants, landlords across California hoping for relief are only finding more months of hardships.

Several landlords reached out to the California Globe about how the order could financially ruin them.

Renters not paying due to the moratorium in LA

“Me and my husband own a block of apartments in Los Angeles,” said Susan Chang, a Los Angeles landlord. “Out of the 12 units, currently 5 are not paying any rent. Our income has literally been halved.

This was supposed to be our retirement. We never got much in pensions or 401ks, but by chance we managed to buy an apartment complex with our savings. One of our friends is a handyman and another owns a gardening service, so all together we had a good system.

Then the coronavirus hit. Now we are unsure what to do. Normally we would evict. We feel for those tenants, especially those with kids, but this is business and not personal. They were negotiating a reduced rate with use until the moratorium was announced, then all five immediately stopped. They know the law. They also know they don’t have to pay until October.

In October it will be a huge fight over back rent, evictions, and other things I don’t want to think about now, but presently it’s rent and how they haven’t legally paid in months.

I know the government means well, but if I don’t get the usual rent amounts soon, we can’t make paying the mortgage. In August, part of our social security checks will actually have to go towards that.

I honestly can’t believe it came to this.”

A tense home renting situation in San Bernardino disrupted by the moratorium

A home renter, Noel Wilson of San Bernardino, also shared the realities of such a moratorium.

“I own one home in San Bernardino in which I rented 2 years ago to be able to go back to school to earn my masters,” shared Wilson. “January was the last rent payment I received and the tenant has made no contact as to why he can’t pay. I tried selling the house in late April. When I tried to gain access to the house after given 24 hours notice, the tenant had changed the locks and called the police on me. Can you believe that?!

Everyday I research, investigate, and connect with people who are in the exact situation. I have drained my savings account paying for the mortgage and have received a forbearance but will ultimately be responsible for paying borrowed money back. I’ve worked so hard for to live the California dream.  Now my dream has turned into an unbelievable nightmare!

I’ve been dealing with this for 6 months. He was almost 30 days late paying rent for December. Paid January.  In February I gave him extra time to pay but had to file a 3 day or quit at the end of February. I hired an eviction company and they said the tenant evaded service 3 times. The tenant said he was sorry and was seeking some sort of assistance from a government program and would pay by March. He also said he was looking for another place to live. He also has a cat and my house smells like cat pee.

Since the moratorium he has ignored all communication with me. I decided to put the house for sale to avoid foreclosure. I’ve put up 3 for sale signs and the tenant has torn them down. The neighbors rarely see him. He posted a sign to his from door saying no one is allowed due to [COVID-19] but replaced that sign with a note to the UPS and FedEx drivers saying ring the doorbell when dropping off a package.”

Unforeseen situations of Newsom’s executive order

Newsom’s order was primarily aimed at protecting renters, many of whom are facing severe hardships due to lost jobs, inadequate unemployment payments, or other financial issues stemming from unemployment. With many fearing a huge rise in homeless people if evictions should continue, eviction protection was put into place. John Oliver gave this argument, among many others, during his ‘Last Week Tonight’ program earlier this week.

“If we allowed eviction moratoriums to end at the end of July, California could have been facing a mass homelessness crisis, way bigger than now,” noted homeless counselor Jane McCutchen on Wednesday. “We’re already seeing many continue to move out anyway because, despite the moratorium, people without jobs can’t afford many other expenses. I’ve talked with many people who have become homeless  this way.

Without eviction protection, that would mean at least 10,000 more in California.”

And tenants from the landlords the Globe talked to have been in those very same predicaments of being caught up in hard times.

“Three of them lost jobs in March, all waiters or cooks,” said Chang. “Then in April two others were let go. One worked at a WeWork office and the other was a salesman of sorts.

Some had let me know early on, but others I only found out when I knocked on doors and they told me that and that they were protected. One of them even slammed the door in my face.

Another actually broke their lease agreement by having their mother move in, but again, I can’t do anything due to the moratorium. ll I can do is ask.

And California law is very prickly about this. I can’t switch off power or water or gas legally. Others have tried that to force tenants out, only for the court to side with the tenants. Newsom had been my hope, that he would give landlords a break. But he just screwed all of us over.

Again, I know he wants to protect people from coronavirus, but if we aren’t protected either, what will they do when everyone is out on the street at once when the mortgage defaults?”

Noel’s situation painted a similar story.

“The tenant used to be a store manager for Walmart, got fired 2 years ago and is now leasing a car from Uber. He works nights while his alcoholic wife takes care of the child.
I’ve tried to reach out to him many times asking why he can’t pay rent and if he could pay a portion of the rent. I’ve offered lower rent,  money to leave with no strings attached, and good references. I never received a response. He has clearly taken advantage of my kindness and the evict moratorium. Makes me never want to rent again, that’s if I don’t lose my house.”

While protections may extend to small businesses, and thus grant landlords who are operating under a small business either federal or state funds, many others simply renting by agreement and not by agreement with a company could be left out.

A landlord in Oakland who wished to remain anonymous shared her experience in attempting to get emergency funds as a small business.

“I don’t want to say where I went, but when I showed them my financials they asked who the checks were being made out to,” explained the Oakland landlord. “When I showed copies of checks showing them being made out to me and not a renting company, they said they couldn’t do anything.

It’s apparently that simple.”

Few assistance options for landlords and building owners

Experts agree that not only more assistance needs to be made available to landlords, but ignoring landlords needs could lead to a larger rental crisis in the future.

“If more landlords don’t get rent payments or government assistance out of this, they may wind up being unable to make mortgage payments and losing the property,” noted accountant William Hewitt, who looks after finances of several renting companies and landlords in LA County. “So not only will the landlords be out, all tenants are at risk of having to go out.

Now it becomes a question. Should landlords be allowed to evict to get new tenants so that a few very needy tenants are on the street, or should we protect tenants but risk landlords and possibly all tenants from losing it all? It’s a hell of a gamble with no easy answer.

But if there’s a tenant out there who said that the landlords should have been the ones preparing for a rainy day and not have the burden be on the tenants, they are very much wrong. Tenants have a contractual obligation to pay

Coronavirus has been the trump card here. The current recession, you know, evictions would most likely continue as usual, even in California. Look at the Great Recession ten years ago. But Governor Newsom and doctors are scared that a mass homeless issue would be not only humanely dangerous, but it could lead to even higher spikes of coronavirus.

It is for certain that a lot of Californians will be evicted come October if no more extensions of moratoriums are made. But who knows if some of these landlords can last this long.”

With tenants being protected, many landlords now face an uncertain summer, with little recourse.

“No one ever wants to feel sorry for a landlord,” added Susan. “They think we’re just in it for profit.

But we really do care and are willing to work with people during hardships.

This is what happens when they legally don’t have to even attempt in doing that. This is that reality.”

Evan Symon
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27 thoughts on “The Unseen Costs Of The Extended Eviction Moratorium

  1. I do feel bad for the owners..and I’m a renter…When I read about the eviction thing, I saw this coming. Sad they won’t even pay partial…those that can.

  2. What Gruesome and the Gang pretend to not understand is that we NEED property-owning Mom and Pop landlords to provide rental housing. There were already so many obstacles in place against landlords that now, with this nail in the coffin, one would have to be a full-blown masochist to own rental property and even in California there aren’t enough masochists to provide that service.

    Gruesome HIMSELF caused the very situation where masses of people are out of work and can’t make the rent, with his doofy response to COVID as well as other bad Dem policies already in place, of course. And look at AB5 as one example where repeal of this stupid thing would improve the situation immensely. Has it been repealed? NO, Lorena (AB5 The Job Killer) Gonzalez and her ilk are digging their heels in more than ever to kill people’s ability to make a living during our needless lockdown and the governor does NOTHING to remove it, although he can. And Atty General Becerra is spending money the state can’t afford to CRACK DOWN on AB5 enforcement and thus people’s ability to make a living. Is this the most bizarre thing you’ve ever heard? It should be, although admittedly in California it has a lot of competition. But never forget it.

    Then to add insult to injury Gruesome inserted himself unnecessarily where he can only make the situation worse. Landlords and renters were doing their best to negotiate among themselves and were apparently having good success even short of full monthly rental payments. Landlords were showing patience while renters did what they could to pay, until the eviction moratorium came along and gave renters an excuse to skip and hide and cry COVID, whether COVID was actually an issue in their lives or not.

    The upshot is that we will now have fewer landlords and thus fewer rental properties. Thus if you are on the side of renters you should not back what Gruesome has done here. Good job, Gov Gav and the Gang!

  3. Long time coming…has been a goal to make apartments Public Housing by State Issuing sponsored bonds to raise funds to buy up foreclosure apartments, literally solving the affordability problem and competitive business labor economics overnight.

  4. Note to self: I’m thinking it’s not a great idea to be a landlord in California anymore.

    Pretty certain of that assessment.

  5. The writer states- “the government means well”- unfortunately they do not.
    Using CV-19 as a vehicle, the end game is to force owners into foreclosure and use gov “land trust” funds to get these properties on the cheap. The goal is a massive public housing scheme. “Socialized housing” it is termed. Oakland is ground zero. City Council there is presently biased with tenant activists who have no clue of real world consequences of their actions.
    Hey- Bolshevik land managers deserve a second chance- maybe it’ll go better this time?

  6. My elderly mother has been trying to move back into her home since January. We gave the tenant a proper 60 day notice required by law, stating that we no longer wanted the home as a rental, and that my mother would be moving home along with her daughter to live. The tenant tells us every month she is going to move, but continues to squat in my mother’s home. The tenant is NOT affected by COVID19, her income stream has NOT been affected by job loss, etc. The tenant is holding my mother’s home hostage. The tenant is NOT paying rent, and is there unlawfully. The tenant has threatened my elderly mother. There are actual people who are affected by COVID19 out there, but there are also the con-artists, & liars who are taking advantage of the “ALL evictions are banned in California” ruling the California Judicial Council placed on 4/6/2020. My mother’s tenant has options, but has refused them as she knows she can just squat till…. Our family has empathy for those truely affected by COVID19, but feel this blanket ban is very unfair to landlords, and also unconstitutional.

    1. You are definitely not alone in this. In southern California this has been going on for a long time: Renters or even just squatters have moved in, are sitting on other people’s property, not paying rent, and refuse to leave. And, for the most part, the law protects them. Last time I checked, removing them CAN be done, but it is a long and tedious process, and unscrupulous people are taking advantage of this. And even formerly average renters are turning into unscrupulous people because of the leeway they have been given. We’re not talking about people who would otherwise be living on the street, by the way. As another commenter here recently said, “they know the law!” It’s unbelievable and outrageous that this should happen.

      1. My husband and I our both landlords who are retired we have a tenant who is a physician assistant who is definitely not affected by Covid 19 who is purposely destroying our rental home is verbally abusing me via text messages and refuses to leave our property tells me I’m not even allowed to leave notices on door what can I do ??

    2. We are dealing with the same thing
      You are not alone . My hair fell out in the last few months due to stress. These monsters are enjoying free rent till January..

    3. I’ve got that going on too. They are working. They make no attempt to contact me. They have destroyed my place. I gave the a change because I personally knew the older woman, I w9rked with her for years. They are all gaming the system. Her with get ” stress” workmen comp claim, her son with his “asthma so bad they thought it was covid, they sent me home for 14 days ” his gf who is collecting food stamps and illegally braiding hair in the house. I feel sorry for the little kids but they are destructive, they have broken the plumber 6 different times due to their parents totally not interacting with them. Yeah,this was a ” friend”. Nice huh

  7. Clearly the government is violating our 5th Amendment:

    Eminent domain refers to the power of the government to take private property and convert it into public use. The Fifth Amendment provides that the government may only exercise this power if they provide just compensation to the property owners.

    This is not an health issue anymore, it’s Government trying to takeover Landlords property. They are using the pandemic as an excuse to do so. We as Landlord need to fight and take a stand. Most tenants are using this pandemic as an excuse not to pay rent. People refuse to go back to work and pay their bills, but yet they’re out at bars and beaches. It will not end unless we take a stand. Why should we pay property taxes? How can we go about doing a class action suit against the government?

  8. Landlords are going to sell their rentals and get out of the business causing there to be fewer and fewer rental units.

  9. Queeg and Dennis are right. This is a massive government takeover of housing in this state. First create a “problem” and then swoop in with a “solution”. I am sure Gruesome and his cronies will rig the process to profit enormously from these buyouts and from operating government run housing.

    1. CW: It always seems to me that all roads lead back to what Edward Ring has written about this. I believe he has spelled it out many times, but the article below is a standout, in my opinion. Read it again:
      https://amgreatness.com/2020/03/09/gathered-for-the-feast-at-the-hotel-california/

      As I understand it, he is talking about a process whereby politicians, in this case the City of L.A., Mayor Yoga Pants Garcetti and his cronies, for example, are installing so-called “bridge housing” for vagrants, whose presence in certain neighborhoods increases criminality and otherwise devastates residential neighborhoods, eventually blighting them. Once blighted, the law allows that residents in such neighborhoods can be bought out by eminent domain, after which such land becomes available at bargain basement prices to wealthy developers to build luxury condos and hotels, thus enriching the wealth class, increasing the tax base for the City of L.A., and otherwise indirectly benefiting the politicians and government entities who made it all happen.

      Notice that “bridge housing” is being installed in some of the most valuable pieces of real estate in California, for example Venice Beach, not on the outskirts of urban areas on cheaper land. Notice that the “homeless” who are installed in the “bridge housing” seem to mostly take the form of menacing young men who threaten residents who are out taking their dogs for a walk, “homeless” who drink, drug, defecate in the open, scream, carry weapons, get in fights, and other such activities that tend to keep residents feeling unsafe and locked up in their homes. A new so-called “bridge housing” facility was just opened in San Pedro, another waterfront area in a quiet neighborhood apparently deemed ripe for the picking. Guess we’ll see what happens there:
      https://laist.com/latest/post/20200706/bridge_shelter_garcetti_san_pedro_homelessness

      Looks purposeful to me and also extremely sinister, in that it is government-created and brought to you by politicians for their own benefit under cover of “compassion,” and “helping the homeless,” as Edward Ring has pointed out so well.

  10. I would thoroughly delight in watching unspeakably horrendous things happen to Newsom and his family…to include his Aunt Nancy. Truly, I’d throw a free neighborhood beer-n-bbq if it were tragic enough! Plus fireworks, oh yeah!

  11. The way I see it, government said it’s OK to steal from landlords for now. From federal Republican’s (Trump’s) perspective: “Sure as a super reach, it’s a perfect opportunity to show a loss on marginal income from RE and realize capital gains with new laws allowing them to do so”. From the Democrat’s position(Newsom): “I am so nice and protective of the poor of this world”. In reality: None of them care about you!
    Poor and honest renters, mostly immigrants, will try to pay rent but spoiled so-called citizens will not pay even if they can. I want to see these swapped. If this is a war and you, as US citizen betrayed the United States economy, you are not a citizen. On the other hand, if you are an immigrant but have proved your loyalty you deserve citizenship! ->>> Add your opinion: https://www.facebook.com/groups/3194264167325050/post_tags/?post_tag_id=3194268707324596

  12. I think this is a violation of the 13th Amendment…………which abolished slavery and involuntary servitude……….landlords are forced to do the maintenance of property for which they are not paid. If a water heater breaks in the middle of the night, I am required to fix it without being paid. I need to clean carpets and repair roofs
    and broken windows and get rid of rats and roaches……….all this is demanded of me without pay……….isn’t that what slavery is???

    1. Why are you a landlord, why don’t you just live in your house? A slave would never be able to own anything, so you wouldn’t own a house if you were slave. Sell your house and just have one house, so other people could own a house. There should be a limit on owning too many houses. If you own the house and don’t want to upkeep it just sell it. That. Easy.

  13. What? How does someone owning a rental property preclude anyone else from having a home?

    There are many individuals, like myself who worked extremely hard towards securing some kind of retirement. Rental income was intended to provide the necessities of life (ie food) during my more advanced years. Instead, I have a deadbeat tenant in my single rental property, who will not communicate and refuses to pay rent, has not provided any proof of COVID related issues and invited an unauthorized “guest” to squat. The guest is a realtor no less, who owns a $1.0 million property and is collecting rent and has employment income while living in my place free of charge while I continue, by law, to maintain the property. The lease was fixed term and ended a few months ago. The judicial council needs to rescind Emergency Rule 1 and commence with processing non-COVID related unlawful detainer actions! It was never the intent of Governor Newsom’s eviction moratorium to prohibit all evictions….just those that are COVID related. The Courts have exceeded their authority and are standing in the way of allowing the law to prevail.

    1. Are you renting as a means to gain income (i.e., investment)? If that’s the case, then you should be prepared to take a loss since everyone else is taking a loss. I’m not arguing that you shouldn’t be allowed to evict your deadbeat tenate since that is truly horrible they are taking advantage of you, but just that most people are unemployed right now and it’s better to negotiate with tenates rather than threaten them. I grew up in the Bay Area and job income has not kept up with the housing costs. If you didn’t see an issue like this coming than it’s too bad, but CA has had it coming for awhile. Other states are now charging a lot for rent as well. I’m just saying that we should make easier to own a house and protect renters for now–they are going to be homeless if we don’t. No one really needs to own 10 houses anyway–I mean why? Make it easier for people to own and reduce the need to rent. I’ve been sexually harassed and abused by landlords and they get away with it because you are renting from them. It’s like being from a third world country to rent. Have you seen some of the ads on Craigslist for slave labor for a room or for a live-in girlfriend? That is wrong! If you don’t understand why it’s important during COVID to prevent evictions than we might as well welcome the riots that are about to happen if we don’t offer some relief to people (i.e., government programs protecting both parties). People are dying. Do we really need rioters burning down houses? Have some empathy for some of us renters who pay rent on time and leave the house nice. Not everyone is shitty…

      1. Melissa, of course I am looking in my retirement to exceed my costs of renting a single condo. As I mentioned, this investment was intended to provide some basic level of security in my old age to provide essentials for ourselves without having to call on the government/taxpayers to help us out. If you see something wrong with that, perhaps you need a reality check. You are quick to suggest that I should be prepared to weather an economic downturn and accept losses, but renters apparently should not be held to the same standard and do not have to even attempt to save during better times for a rainy day? I appreciate that there are good and bad landlords just as there are good and bad tenants. I never implies otherwise. I rented for many years myself before owning a property and was always open to communicating with my landlords. My tenant and univited guest will not respond to an honest, unthreatening attempt to communicate about their circumstances. Have you ever considered that it is unscrupulous and unethical tenants that are also creating a hostile environment for decent tenants who are willing to communicate and work with their landlords? When/if I ever get possession of my home again, I will most likely sell and remove my modest and affordable property from the rental pool. Do renters gain from that reality? If mom and pop landlords throw in the towel enmass and the pool of rental properties shrink, renters are certainly not in a better position. This in itself does not afford people who are renting the opportunity to purchase rather than rent. You still need to qualify for a mortgage with a lender or is that somehow the landlords responsibility also. Forget the hysteria Melissa and stop doing what you are accusing all landlords of doing…all landlords are not the devil. Enough with the generalizations already!! If you read my original post, I was merely suggesting that a blanket evicition moratorium does not work. There are some very good reasons why landlords are put in a position to evict a tenant other than for non-payment of rent. Next time you have the pleasure of living next to a tenant that is a nuisance or perhaps worse, endangers your life, you will be given an opportunity to reconsider that a landlord has no legal avenue available to them at this time to assist in restoring peace in your immediate community. This while you, as a good tenant, continue to pay your rent, or at least attempt to pay rent. As I said initially, allow for evictions to proceed that are non-COVID related and have nothing to do with non-payment of rent!

  14. I’m in the same situation, tenants just taking advantage of all this three months without pay rent and government don’t care owner/landlords. Let’s do a lawsuit against CA

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