The best of intentions of Government very often hurts the very people they are trying to help. 53% of 1 - 4 unit rental properties are owned by Mom and Pop investors. 58% of renters have failed to pay rent during the pandemic. Since only $3 Billion of the $47 Billion of the rental assistance payments approved by the federal government has actually been paid out, landlords have not been paid back rents. And, in many instances when tenants either got increased unemployment insurance and or rental assistance, they simply did not pay the rent anyway because they knew they could not be evicted.
This has caused some landlords to refinance their loans to take money out if they could, which eventually will lead to higher rents. And, or they sold their rental properties to other investors who are likely to increase rents sometime soon. Since we are experiencing inflation, rents are going up anyway. While higher rents hit all renters, they will be most painful for low income renters.
Further, smart landlords use comprehensive rental applications to screen out deadbeats and further will not rent to tenants with lower than a 600 credit score. Tenants who failed to pay rent could very well see their credit scores go down as landlords eventually file to evict them. Further, rental applications ask for references including past landlords. When called, the landlord is likely to reference the eviction, or failure to pay rent. When that happens, the next landlord is not likely to rent to the tenant with a bad credit history.
Federal and state government programs to deal with rental assistance during the pandemic have failed miserably. The money for back rents owed should have gone directly to the landlords not the tenants to insure payment. In the end, this failure will hurt lower income people and the poor most. There may still be time to fix it; but unfortunately government bureaucracy often gets in the way. This is another classic case where government is the problem not the solution.
