Rent meltdown looms
With tenants out of work, landlords will also suffer
Hundreds of thousands of New Yorkers suddenly out of work due to the coronavirus pandemic will have trouble paying rent next month — and landlords say building owners need immediate relief to soften the blow.
Jay Martin, executive director of the Community Housing Improvement Program, which represents owners of some 400,000 rent-stabilized properties across the city, estimated that 39% of the group’s residential tenants would be short on rent come April 1.
“Without a freeze on the bills for the buildings themselves there is a huge, huge problem with the housing market,” Martin said.
Gov. Cuomo on Thursday gave some New York property owners a 90-day waiver for paying their mortgages, but the order only applies to single and two-family homes, leaving out the vast majority of New York City’s housing market.
Politicians like Sen. Michael Gianaris (DQueens) (below) and Brooklyn Borough President Eric Adams have this week called for tenants impacted by the virus to stop paying rent for 90 days because landlords won’t have to pay their mortgages.
But Martin said those calls are based on a gross misunderstanding of Cuomo’s directive because almost all of the city’s building owners are still on the hook for monthly mortgage payments, along with other expensive bills.
“This cannot stop at the building owner’s doorstep,” added Frank Ricci, director of government affairs for the Rent Stabilization Association. “If the owners had mortgage forbearance, and a waiver on their property tax and on their water and sewer fees that’s probably 40% of every dollar they take in. That’s a start.”
Cuomo on Friday announced all commercial and residential evictions will be suspended statewide — but he did not give any direction to floundering renters or landlords about what to do next.
Tenant advocates applauded Cuomo clarifying the state’s moratorium on evictions but said more needs to be done to protect renters who suddenly find themselves out of work.
“What we still need is a forgiveness of the rent that people begin to owe during this period,” said Cea Weaver, the campaign coordinator with the tenants’ rights group Housing Justice for All. “All that we’re calling for now is just a freeze on the ability to collect rent, which we think that the governor can order.”
“This industry has been asking for guidance from Albany for some time. In this day and age that means a few days,” said Martin. “We’re not getting any.”
The suspension proposed by Gianaris would apply to residential and commercial tenants who would have 90 days of rent forgiven if they lose work or are forced to close due to the COVID-19 outbreak.
Cuomo spokesman Peter Ajemian said the state was looking at other measures “to help New Yorkers weather the economic storm this pandemic has caused.”
“Since the beginning, we’ve been helping New Yorkers navigate and mitigate the collateral effects of this pandemic on multiple fronts, including by enacting a 90-day moratorium on evictions, suspending state debt collection, and directing banks to waive mortgage payments,” Ajemian said.
The city should extend the mid-April deadline for property taxes by 90 days to help New Yorkers burdened by the coronavirus pandemic, Councilman Justin Brannan said.
The extension, which wouldn’t include financial penalties or added interest, would be coupled with a “complete” pause on lien sales.
“All New Yorkers are facing looming financial impacts as a result of this pandemic – and it’s only going to get worse,” Brannan (D-Brooklyn) said. “By giving property owners a 90-day extension and a pause on lien sales, we can allow everyone to focus on the immediate need of stopping the spread of COVID-19 as well as having the free cash to deal with the near term fallout.”
New York homeowners with properties assessed at less than $250,000 have until April 15 to pay their quarterly bills interest-free.
James Whelan, head of the Real Estate Board of New York, called the extension a “common-sense proposal that will ease the anxieties of New Yorkers who are worried about meeting the property tax deadline.”