PD Editorial: Don’t let a health criss fuel a housing crisis
For a second consecutive month, rent and mortgage payments are falling due while millions of California residents are out of work.
Those who have “essential” jobs are allowed to work during the coronavirus lockdown, and some people are able to continue earning a living from home.
But nearly a third of California renters missed their April deadline. And the economic impacts of the pandemic are still spiraling. Roughly 3.7 ?million Californians have filed unemployment claims over the past seven weeks, Gov. Gavin Newsom said Wednesday - a tsunami of joblessness unseen since the Great Depression.
Despite recent relaxation of lockdown orders, and hints of more to come, any return to normal appears to be several weeks away. In six Bay Area counties, stay-at-home orders have been extended through May, and the updated order issued by Sonoma County's public health officer, Sundari Mase, is open-ended.
California is one of several states that enacted eviction moratoriums to protect renters from losing their homes if they cannot pay their rent because of the pandemic. Given the nature and likely duration of the crisis, that made sense.
California already was fighting what appeared to be a losing battle with homelessness when the pandemic hit, and the state experienced a steep increase in homelessness after the real estate bubble burst a dozen years ago.
There have been heartwarming examples of property owners reducing or forgiving rent, such as columnist Chris Smith's story about Marv Hyman waiving April's rent for his downtown Santa Rosa tenants. But landlords could use some help right now, too.
Landlords provide a large portion of the housing stock - about 40% in Sonoma County.
Many of them are small business owners who rely on rent for income or retirement. So they aren't looking to throw people out into the street.
Even if they aren't getting regular rental payments, they must pay mortgages and taxes, insurance premiums, maintenance costs and, in some instances, utilities.
Sonoma County doesn't have enough rental housing. It can't afford to lose any of its existing stock or to have units slip into disrepair. Tenants aren't likely to benefit from a round of sell-offs to real estate investment funds, either.
The state missed one opportunity to help local landlords when it opted not to include property taxes when it extended deadlines for paying income and sales taxes.
At the federal level, owners of multifamily properties whose mortgages are held by Fannie Mae and Freddie Mac can defer mortgage payments for up to 90 days if they don't evict tenants for nonpayment during the pandemic. But only about half of multifamily property owners have government-backed mortgages.
Congress already has spent trillions on virus relief, and California lawmakers will face a budget meltdown of their own when they reconvene on Monday. But they must act to prevent an avalanche of evictions and the loss of thousands of units of rental housing when the pandemic passes and the moratoriums are lifted.
Solutions will be difficult and costly. Proposals include microloans, federally funded rent vouchers and tax relief. The one thing that must be avoided is creating a new, even larger housing crisis.
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