Should landlords suspend rent during the COVID-19 pandemic?

Cyril Josh Barker | 3/21/2020, 9:28 a.m.
The coronavirus (COVID-19) continues to have a major impact on the economy with small businesses closing and companies laying off ...
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The coronavirus (COVID-19) continues to have a major impact on the economy with small businesses closing and companies laying off workers.

Reports indicate that the COVID-19 outbreak could cause 5 million people to lose their jobs. In New York, layoffs are already being reported in the restaurant, hotel and theater industries––due to mandatory closures in an effort to stop the spread of COVID-19.

In another sharp blow this week, Gov. Andrew Cuomo ordered all barbershops, hair salons, tattoo or piercing parlors, nail salons, hair removal services, and related personal care services to close, leaving more workers without a steady stream of income.

Advocates say that with so many people losing their job, landlords should consider suspending rent.

New York Communities for Change (NYCC) is one of the organizations leading the charge to get rent suspended for city dwellers. While Cuomo has already halted evictions and suspended mortgage payments for 90 days, NYCC says renters should be included.

“In a global pandemic that has shut down major cities across the country, housing is health care. We need to stay in our homes to protect ourselves and our communities,” said NYCC director Jonathan Westin. “Nearly 100,000 people in New York were homeless before the crisis. Now, so many New Yorkers have lost income in this crisis that the unemployment website has crashed.”

Brooklyn Borough President Eric Adams wants a 90-day moratorium on rent. He said New York City renters comprise roughly 65% of all residents and are more likely to fall in a lower income bracket.

“As a small landlord myself, I understand and am sensitive to the fact that many small landlords throughout the city rely on rent payments as their primary source of income,” he said. “Though I have no illusions that this adjustment will be easy, I am confident it is the right thing to do given the current circumstances.”

Senate Deputy Leader Michael Gianaris from Queens is also calling for a 90-day suspension of residential and commercial rent for tenants and small businesses impacted by the coronavirus pandemic. Under the proposal, residential and commercial tenants would have 90 days of rent forgiven if they lost their work or closed due to COVID-19.

“Under the leadership of Gov. Cuomo, New York is doing an excellent job of managing this crisis, but the devastation caused by coronavirus will be far-reaching and long-lasting,” said Gianaris. “We must stay on top of the fast-changing consequences of our efforts to contain the virus, and the millions of tenants in our state cannot be left behind. Suspending rents is a critically important step to help New Yorkers survive this unprecedentedly difficult time.”

Manhattan Assemblymember Linda B. Rosenthal said in a statement that with tens of thousands of workers losing their incomes so quickly, suspending rent is one of the best ways to keep people in their homes during the pandemic.

“It is vital that we immediately suspend statewide the payment of residential and commercial rent,” she said. “Together with an eviction moratorium, a commercial and residential rent-freeze will help to provide already-anxious New Yorkers with desperately needed peace of mind during this public health emergency, while enabling New Yorkers to prioritize spending their now incredibly limited resources on food and medicine for them and their families.”

The organization Housing Justice for All is also pushing for a rent suspension. They also said some landlords could use the pandemic to even raise rents.

“No one should be displaced or go into debt because they can’t pay their rent or their mortgage. An eviction moratorium is an urgent first step, but we need a suspension of rent and automatic forgiveness of any rent, mortgage, or utility payment owed or accumulated during the length of this crisis,” the organization said in a statement. “Landlords must not use this moment to price-gouge or displace any tenant who cannot pay the rent (commercial or residential.) All existing rents should be frozen at their current level, and all tenants should have the right to renew their leases.”

The Bronx-based National Homeowner-Landlord Association (NHLA) has about 350 members, many who own a small number of apartments. The organization’s executive director Philip D’Erasmo told the AmNews that, like all businesses, landlords would also suffer if there’s an economic crisis.

“Most of our landlords are lower middle income people who have one or two apartments,” he said. “Having a two family house doesn’t mean you are a rich landlord. We hope that there is some kind of economic stimulus for landlords.”

J’Nell Simmons, who is CEO of LandlordsNY, said in a statement to the AmNews that landlords want to help but suspending rent isn’t the answer.

“If there will be a 90-day forgiveness of rent––there must also be a 90-day forgiveness of taxes, mortgages and utilities,” Simmons said. “In addition to the aforementioned monthly bills, building owners still also have to pay their staff, including essential employees who are keeping their buildings safe, clean, and sanitized for residents who are sheltering in place and working from home. It’s our hope that common sense will prevail and a plan will be developed that will ease the extreme burden that many New Yorkers are facing right now.”

The National Apartment Association said that policymakers should remember the impact on rental housing providers and apartment communities at-large. They say rent payments should be delayed instead of waived and the federal government should step in with financial assistance.

“Short term financial assistance would help poor families continue paying rent and buying food until the broader economy stabilizes,” said Jenny Schuetz of the Brookings Institute, a nonprofit public policy organization. “It would be more effective than a temporary moratorium on evictions (as some jurisdictions have enacted), since landlords also need money to pay their mortgages, property taxes, and utilities.”