The Apartment Association of Greater Los Angeles (AAGLA) has filed a lawsuit against the City of Los Angeles on behalf of its members and the City’s housing providers. The lawsuit, filed in Federal Court today is a constitutional challenge that essentially argues that the City’s prohibition imposed on residential and commercial landlords from undertaking eviction procedures for tenants financially or otherwise impacted by the pandemic singles out landlords and property owners throughout the City to absorb the residents’ claimed economic losses attendant to the crisis. The lawsuit further asserts that the City’s eviction ban illegally modifies existing contractual relationships by nullifying any late fees or interest while the emergency declaration is in place and throughout the one year period following the end of the emergency, and also imposes a moratorium on annual rent increases for any rent increase scheduled.
Finally, the lawsuit asserts that the City’s imposition of the eviction ban provides benefits to renters well beyond what the State has provided through the Governor’s orders, and that the City has exposed itself to significant liability risk for all damages associated with the eviction ban, including the damages stemming from the lack of “end date” on the eviction ban and the one year grace period following the, as yet, unknown date.
Airbnb hosting services in apartment buildings have been banned in NY, CA and many other states. Now NY is not only slapping fines on hosting providers but also additional civil court penalties which attach to the property title if a landlord is caught engaging in Airbnb hosting. Attaching to the title means the marketability of the property is adversely affect during a sales transaction. As for tenants who engage in Airbnb hosting services, they face automatic eviction and stiff penalties.
New York City hit the three buildings with more than $46,000 in civil penalties prior to filing the lawsuit, according to court documents. The suit asks the court to ban space in the buildings from being used as short-term rentals going forward and have the defendants pay the city a fine of $1,000 per day for each day they violated its rules on short-term rentals. It seeks $500,000 in punitive damages for the city as well. The city has sued multiple landlords over alleged illegal Airbnb violations in recent years, including Metropolitan Property Group, the Torkian Group and Philip Baldeo.
“The message is clear: illegal hotel operators who flout the law will see consequences–and their day in court,” City Hall spokeswoman Avery Cohen said in a statement.
The US Army built a surge hospital for Los Angeles coronavirus patients in just 3 days during the weekend of March 28. The hospital was built on top of the convention center parking garage. It was built so fast and surreptitiously that even some local police officers in the city don't know it exists. This hospital was in addition to the conversion of the Los Angeles Convention Center into a military field hospital for coronavirus patients. The army started both sites [the parking garage rooftop hospital and LA convention center conversion] on Friday night and was finished by Monday morning.
BofA Securities' economist Michelle Meyer said the COVID-19 pandemic will deliver a big negative shock to the housing market. They expect an adjustment lower in home sales and housing starts over the next three months. However, they believe home prices will hold relatively steady.
Meyer sees existing home sales down a cumulative 37% from the peak in February and new home sales down 51% from the January peak. Housing starts should fall a similar 57% from the peak, she added.
On prices, they forecast home prices will be pushed lower, hitting a low of -2.3% on a YOY basis in April 2021. They said the home price outlook appears tame relative to the sharp correction in sales due to three reasons:
StreetInsider.com Fri, 24 Apr 2020 09:03:00 -0400
UPDATE 4/30: rent payments rise 8% to 91.5% during April (new details at end of article)
ORIGINALLY PUBLISHED 4/21
Disturbing information is developing regarding fake rent payment delinquencies of renters. Main stream media is widely reporting that one-third of renters could not pay rent for the month of April 2020. This fake news is being propagated by CNN, Wall Street Journal and Newsweek and others. Although all the news organizations provide the name of the source, they misrepresent the information and outright lie about the numbers. All three news networks quote the source of the data as the National Multifamily Housing Council. However, they do not show the complete picture. The NMHC has a Rent Tracker webpage which explores the latest rent payment data across the United States from its survey of survey of 11.5 million units. According to the report, 84 percent of apartment households made a full or partial rent payment by April 12 in its second survey of 11.5 million units of professionally managed apartment units across the country, up 15 percentage points from April 5. In fact, when compared to last year, the percentage of rent payments made for the month of April only has a 6% difference.
SOURCE: National Multifamily Housing Council
Below are the headlines from the major news networks...
Source: Brueggeman and Fisher
As the coronavirus pandemic prompts unprecedented job losses across the country, one of the first problems for many households will be how to pay next month’s rent or mortgage. The poorest 20% of U.S. households—including many workers in low-wage industries such as retail and food service—were spending more than half their income on housing costs even during the economic boom. These families have little or no savings that can help them weather the sudden loss of income stemming from the pandemic.
To protect renters from losing their homes, a growing number of cities and states have put a temporary halt on evictions, meaning that landlords cannot evict tenants who fall behind on their rent. While this may buy renters more time, a moratorium on evictions could cause ripple effects that further hurt local economies. But there is a more effective way to help renters by giving them cash that replaces lost income, while also supporting small businesses and local governments.
Rent has important multiplier effects in the local economy
Rent checks don’t just line the pockets of fat cat landlords—they also contribute to essential government services and other workers’ wages. If many households are simultaneously unable to pay rent, the economic impacts will be felt throughout the local economy. (see Table 1 above)
The first entity that gets paid by a monthly rent check isn’t the landlord—it’s the local government. Property taxes have a higher priority even than mortgages; if a landlord falls behind on both property taxes and mortgage payments, the local government’s claim supersedes the lender’s.
Modelling from The Australian National University (ANU) is set to help policymakers respond to the economic costs in the face of a pandemic and as the virus evolves. The research paper, which models seven scenarios, is the first wide-ranging global economic assessment of the effects of Covid-19.
DOWNLOAD: PDF report