Like Atlas with the world on his shoulders, landlords and property owners are struggling harder with each new month to deal with the burden of nonpaying tenants.
In a recently published article, NJ Spotlight News aptly pointed out that there are “no winners” in New Jersey’s housing crisis, which is driven by its inventory of rentable apartments. Because of the state’s moratorium on nonpaying tenant eviction has yet to be lifted, property owners are going longer than ever before without hope of securing the income they need to make mortgage payments and pay property tax bills.
It’s a no-win scenario for anyone because tenants aren’t paying because many have fallen ill with COVID-19 or have lost their jobs as a result of the economic fallout of the pandemic. Upkeep in their facilities may also suffer as a result of landlords’ collective inability to afford maintenance projects.
“It’s bad and it’s getting worse,” said Derek Reed to NJ Spotlight News. Reed is a partner at Ehrlich, Petriello, Gudin, Plaza & Reed P.C., Attorneys at Law, and spoke as the attorney for the Property Owners Association of New Jersey.
Reed continued: “I get calls almost every day from small landlords that are renting out the other half of their duplex and the tenant has stopped paying rent which is 100 percent of their rental income, and they are wondering what they can do. I have to give them the bad news that there’s not much you can do right now.”
In the midst of a looming financial crisis for landlords that draws closer each month is a new bill before the New Jersey State Senate that could give tenants six months to pay back each month of rent missed due to the COVID-19 pandemic. That means in some cases, property owners might not see the full value of arrears owed to them paid for up to 30 months.
In giving his opinion to NJ Spotlight on the so-called “People’s Bill,” Reed said it again favors tenants at the expense of landlords who will be responsible for collecting interest-free loans that may or may not even be paid back to them during the next two-and-a-half years.
While much empathy and understanding have been extended to tenants who have lost their jobs or fallen ill and are now unable to pay rent, it’s important to remember that many small property owners and landlords are facing difficult challenges of their own.
Some may have lost their own primary employment or were forced to close a business and may now be dipping into retirement savings many years prematurely just to make ends meet. Many may be trapped by mortgages on now non-performing properties that still have costs racking up due to their mere existence and the presence of non-paying occupants.
Perhaps it’s time for the state to finally explore options that provide landlords with the relief they need to end the stalemate between them and lawmakers trying to keep nonpaying evictions frozen at all costs – none of which are theirs.
For more information about the Ehrlich, Petriello, Gudin, Plaza & Reed P.C., Attorneys at Law, contact us online or call (973) 828-0203.