The Trump Administration announced an eviction moratorium through the end of 2020 for any individual earning less than$99,000 and unable to pay rent. Note the word “moratorium.” This only means that individual tenants cannot be evicted for non-payment for now. It does not mean that they don’t have to pay. Come 2021, many of them will owe all of this rent in arrears, so let’s tread lightly on what this means.
Kicking the can down the street
It does not mean free rent. It does not mean mortgages on rental properties are not due. They are. It does not mean property taxes on rental properties are not due. They are. It only means certain people will be able to stay in their homes for now.
Hopefully, you catch the drift of the virtuous circle we’re trying to paint. Tenants pay rent to a landlord, which uses that cash flow to pay a mortgage and city and state taxes. The government uses that tax income to maintain the city and advocate for the tenants. If only one piece of this has been addressed, namely the rent, the other components absorb the blow and can only do so for so long. And if a tenant cannot pay the rent for now, what makes us think they’ll be able to catch it all up magically in 2021 just because of a calendar change?
Treasury Secretary Steven Mnuchin said that he was “pleased” with this measure but acknowledged that it is a stop-gap and not at all meant to take the place of legislation…legislation we do not have and don’t look likely to have any time soon.