RENT IS DUE…WHAT DO WE DO?
Clearly the Coronavirus is having universal impact on every aspect of our society. As the first of the month draws near and rent is due for most tenants, landlords throughout the country have been reaching out to the American Apartment Owners Association for consult. Firstly, we advise all members to be patient, compassionate and cooperative with their tenants. We understand the stress of the moment and the economic pressures on everyone.
Some practical solutions that have been shared include using a tenant’s security deposit as an offset for some rent. Sacrificing the security deposit may have different legal ramifications in different parts of the country, but in light of the current crisis, it should be considered as a viable option to help both the landlord cover expenses and relieve a good tenant from the immediate burden of paying rent.
Other ideas have included a burden sharing with tenants. Members have asked tenants to help with maintenance and gardening as an offset for some rent while, at the same time reducing some expenses for the landlord.
A deferment of rent has picked up traction with a repayment schedule that begins when the tenant goes back to work. For example, the Irvine Company, one of the largest property management companies in the country is offering a deferral of 50% of the April and May rent. Repayment of the deferred amount is then amortized over six months beginning in June. There is no interest charge on the temporary deferment according to Jim Krohn, president of Irvine’s apartment division.
The Essex Property Trust, which manages more than 20,000 units in California has agreed to waive late fees on delinquent rent and stay evictions for 90 days. They have also indicated a temporary halt in rent increases for tenants effected by the pandemic.
The American Apartment Owners Association appreciates all of the suggestions and ideas shared by members. Please continue to contribute your thoughts and check back regularly for updates. Our Coronavirus webinars are free to all and available online at any time. We will continue to update members with changing laws and upcoming events during this difficult time.