Coronavirus Eviction Update

By Colette R. Thomason, Esq.

In a previous article, my colleague wrote that the Tenant Relief Act, which delayed evictions for qualifying tenants, was likely going to be extended by the state legislature further into 2021. This legislation has now passed, and the current eviction moratorium officially extends to June 30, 2021. With this update, a tenant is protected from eviction until June 30, 2021, (previously January 31, 2021) as long as the tenant provides a declaration of decreased income due to COVID-19 and pays 25% of their rent. Once the tenant provides the declaration, they will have until the end of June to make this 25% payment even if the 15-day notice is up.

The crux of the new legislation is to extend eviction protections, and much of the law remains the same as the earlier protections, although there are some small changes. As before, the tenant must sign the “Declaration of COVID Related Financial Distress” under penalty of perjury, and while they are still responsible for unpaid amounts from September 1, 2020 to June 30, 2021, they cannot be evicted for the non-payment. However, if a tenant does not provide a declaration, they can still face eviction for nonpayment of rent. Some good news for landlords is that the legislation also established a Rental Assistance Program, which will assist qualified tenants with unpaid back rent. Assistance will also be available to landlords, provided they waive 20% of their tenant’s unpaid rent. If this 20% is waived and permanently forgiven, landlords will be reimbursed for the remaining 80% of the rent through government programs. These funds will be distributed by state and local agencies, and the programs are now accepting applications. If a landlord chooses not to participate in this program, renters can still apply and potentially receive rental assistance up to 25% of their monthly rent.

While these changes are an important protection for tenants, the lack of consistent rent and decreased rental payments may become a strain on certain landlords, especially as rental prices are already notably down. As a result, there may be an influx of rental properties hitting the market in the coming year as some landlords decide to change their investments. The DeLeon Team is happy to speak with anyone interested in the current state of the law and how we see these changes affecting the market.