Thanks to recent data from the U.S. Census Bureau, and a report from the Daily Bulletin, we know that eight of every 10 tenants in Southern California paid their rent on time during June.
In their “pulse survey”, the Census Bureau survey showed that just 5% of tenants indicated that their rent was deferred.
Federal aid, like the recent stimulus checks, have enabled most tenants in Southern California to stay on track with their rent payments while others have benefitted from the eviction ban and have been able to defer paying their rent now for months.
What’s Comes Next For The Southern California Rental Market?
With the $600 per week in Federal unemployment benefits from the CARES act potentially coming to an end this month, it’s possible that the loss of those benefits, combined with an end to the eviction moratorium on September 30th, could bring a wave of evictions this fall unless more is done to help renters.
As of July 23rd, 2020, lawmakers in Washington are in negotiations for more stimulus aid which could potentially include an extension of the CARES Act unemployment benefits but that extension could be less than the $600 per week that people are receiving now.
Under the CARES Act, renters are protected from eviction until July 25th, 2020. Unless the CARES Act eviction moratorium is extended, tenants in California will only have until September 30th to avoid eviction because that’s when the statewide eviction moratorium is set for expiration.
What About Landlords?
Landlords also need financial help because, for those landlords in California that have been unable to collect rent since March, this represents a loss in rent totaling more than $1 billion.
So far, lawmakers in California have proposed a variety of bills that are aimed at helping the rental market get back on track including a bill that would potentially give tenants until 2034 to repay rent while encouraging some owners to forgive back rent in favor of tax deductions.
Sadly, what’s often lost in the discussion is the impact of Coronavirus on smaller “mom and pop” landlords, many of which who have been unable to collect rent from their tenants in months. Those smaller landlords can’t just walk forgive rent when they are already walking a financial tightrope, using their savings or retirement funds just to cover their mortgages.
It’s more likely that the State of California could propose an eviction relief plan which encourages landlords and tenants to enter it voluntarily, creating a favorable payment plan that tenants could use to get their rent payments back on track.
Contact GoldenWest Management, Inc
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