September 2020 Edition - Politics and Rent Payments
Democrat, Republican, or Independent we should all agree that we are at an historic point in our country’s history. In the last 7 months over 20-million Americans have become unemployed through no fault of their own. Add to this number the millions of Americans who were already unemployed and either homeless. living on government subsidized assistance programs or unable to find affordable housing. Our low-income and affordable housing crisis has been with us for years and is only getting worse.
This is not a problem that either political party is going to solve overnight or even in the near future unless there are major changes in employment and the affordable housing areas.
For politicians, these are issues that affect millions of votes in what is being presented as a tight presidential election year. While this is a human needs issue and not a political issue, the politicians are making it political. The President and Congress are passing the ball back and forth and blaming the other for no immediate solution. Meanwhile, millions of apartment renters are on the brink of disaster. Unemployment levels are starting to decline but are still very high and will be for some time resulting in millions of apartment residents falling behind on their rent payments, according to the U.S. Census. The damage from this will spread throughout the economy resulting in the general economic crisis caused by the coronavirus to continue and expand. I seriously doubt we will see any additional assistance to renters from our government until after the November elections.
This problem belongs to all of us. The unemployment crisis and lack of Affordable Housing affects all of us whether we have a job, a profession and a nice home or not. Common sense and history tell us that if we don’t take care of our society and our country we may see changes that we will not like. A few months back, I read Newt Gingrich’s book Trump vs. China (2019) and learned a lot about how unbalanced our relationships with the Chinese-Communist government has been since the end of World War II and how we have allowed the Chinese-Communist Party to take advantage of us. I recently also re-read George Orwell’s book 1984 (a book written in 1949 projecting a dystopian vision of a totalitarian government, which is how our world could look in the future). I last read this book in 1967 while serving overseas with the U.S. military. It concerned me then and it really scares me now. If you haven’t read it or haven’t read it in a number of years, I suggest that you read it now. If we don’t figure out how to make our democracy work and take care of our people this may be our children, and grandchildren’s future.
Recognize this sign? It didn’t come from George Orwell’s 1984 but is currently on display on Battleground Avenue in Greensboro, NC. I must not be the only person concerned about the direction our government is going.
The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found that this month 76.4% of apartment households made a full or partial rent payment by September 6 in its survey of 11.4 million units of professionally managed apartment units across the county. This is a 4.8-percentage point, 552,796-household, decrease from those who made a September rent payment by September 6, 2019 and compares to 79.3% that had paid by August 6, 2020. This is a continuation of the downward drift in rent payments seen in August. August was the first month that unemployed Americans went without the extra $600 a week provided by the March 2020 CARES Act. This data encompasses a wide variety of market-rate rental properties across the United States, which vary by size, type and average rental price.
The Federal assistance that helped millions of renters stay current on their rents after they lost their jobs expired on July 31st. It is unclear when or if Washington will provide additional help. Owners and their property managers worry that more Americans will fall behind in October and the months ahead. The only thing saving renters at this time is the Centers for Disease Control and Prevention using its quarantine authority to temporarily halt evictions in order to keep COVID-19 from spreading until December 31st.
Renters must say they are not able to pay their rent or are likely to become homeless if they are evicted. Bloomberg states that this is an unprecedented use of executive authority and may face legal challenges from owners. The CDC argues that COVID-19 presents a historic threat to public health. “To respond to this public health threat, the Federal, State, and local governments have taken unprecedented or exceedingly rare actions, including border closures, restrictions on travel, stay-at-home orders, mask requirements and eviction moratoria.”
The new evection moratorium order will leave some apartment owners in a precarious position. Of the 73 million U.S. households that live in rental housing units of all types, 13 million failed to pay their rent last month, according to the Household Pulse Survey from the U.S. Census. In addition, 13% have “no confidence” that they will pay their rent next month and another 19% have only “slight confidence” that they will be able to pay. This is in addition to the 1.1% who are already sure they will not be able to pay according to the Census. That’s 24 million people who have little or no confidence that they can pay.
Renters and apartment owners need help, now! “It is critical lawmakers take urgent action to support and protect apartment residents and property owners through an extension of the benefits as well as targeted rental assistance. That support, not a broad-based eviction moratorium, will keep families safely and securely housed as the nation continues to recover from the pandemic,” according to David Schwart, NMHC Chairman.
Disruption and chaos! It is not beyond my imagination to believe that the Chinese-Communists created this virus and released it on the world to create the disruption and decline of the United States and the rest of the world for their benefit. Millions of apartment renters have fallen behind on their rent payments and the damage is going to get worse as the economic crisis caused by the pandemic continues. Up until Jul 31st those in distress had Federal government assistance to help pay their rent. That support has now expired and the only thing saving renters is the Federal government’s moratorium on evictions until the end of the year. While this may keep a roof over their heads, it does not take care of daily living expense (food, health care, etc.) and it does not help the owners of the apartment properties who will begin to get behind on their mortgage payments, property taxes, insurance and maintenance expenses. So, what are the owners to do? Depend on the Federal government?
The destruction of the U.S economy and society through disruption of our economy and the pressure put on our people as a result, will lead to further chaos and further government involvement in our lives until we are all dependent on the government for everything. This could very easily be how the Chinese-Communist Party pushes the U.S. into becoming a Communist country. It is up to all Americans to realize this and assist in any way possible to help our people and our Country from going further down this road of destruction. We need to work together to maintain our independence and freedom and limit the amount of government control of our lives. How do we do this? Just as our father’s and forefathers did. We help one another and we fight to assure that our Country is not undermined by enemies of our Country both foreign and domestic. We don’t want Big Brother looking over our shoulders!
“Just-In-Case You Missed It” is a monthly letter prepared for multifamily owners and prospective owners. It is a compilation of multiple articles from multiple sources or a reprint of an article from a specific source (source credit given). Its purpose is to present both facts and opinions that may influence our multifamily business in the Southeastern U.S. If you have any questions and/or would like to discuss any of the comments above, my conclusions or your multifamily business, please contact me at your convenience. I can be a valuable resource to you without adding any expense to your budget. I look forward to speaking with you and having an opportunity to meet with you. I am always at your disposal to assist you with your multifamily business. If you would like to review previous editions of my monthly “Just-In-Case You Missed It” letter please refer to articles on my LinkedIn site.
Respectfully,
Rick
G.F. Rick Baker, CCIM
Multifamily Specialist/Investment Advisor
www.RickBakerMultifamily.com
2504 Tinderbox Ln.
Greensboro, NC 27455
Cell: 336.549.6083
Email: rickbakermultifamily@gmail.com
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