CDC Eviction Moratorium Extended
The Centers for Disease Control and Prevention has extended the national ban on evictions through the end of June. “The COVID-19 pandemic has presented a historic threat to the nation’s public health…,” CDC director Dr. Rochelle Walensky said in a statement. According to CNBC, around 20% of adult renters said they didn’t pay last month’s rent. Closer to 33% of Black renters reported the same. I am betting everyone a case of beer Sisolak will make a similar announcement tomorrow or Wednesday.
Our decades of screening experience has paid off. Our 1% delinquency rate rocks compared to the nationwide average. We are still able to toss naughty tenants for lease violations. Pets, damages to the home, HOA violations etc are all valid reasons to have tenants evicted. These are hard to prove but we have been successful on some occasions. Another strategy we have been using is filing small claims against those who us money. Evictions have nothing to do with debt so we are making sure the debts stay with the tenant regardless of their location.
Since we cannot evict people, we are recommending to our owners that we keep rents the same to keep the good tenants we have. Increasing rent during these times is a very bad idea.
Real Estate Correction Looming?
I am still scratching my head. Nothing makes any sense. The stock market is at all time highs while the unemployment rate is at 6.2% (twice pre pandemic levels) and 42% of all the retailers expect debt restructuring (RetailDive). Inventory of homes in Las Vegas is at a record low and people are stepping all over themselves to out bid each other. All this is happening while the unemployment in Nevada at 11.5% and an estimated 25% of the locals are not paying their mortgage. The forbearance is having a major impact on the market. I have an owner listing his house at over $850k and isn’t paying the mortgage because he doesn’t have to. In the meantime, he’s collecting rent because there is zero incentive to lower the price.
Bankruptcies are expected to skyrocket (MoneyGeek). About a 5th of all the US currency was printed in a year (CityAM). Interest rates for investors have already been jacked up by Fannie Mae (HousingWire). We would expect those restrictions to increase and everyone agrees interest rates are going to go up. All of these clouds are converging.
Nearly every buyer here is from California. I have surveyed all my colleagues and no one has had a local buyer in the last 6 months. I predict once the properties start to tank in California, the flood gate will slam shut and prices will fall here. California prices are also a function of the forbearance. When the forbearance ends you can set your watch for foreclosures 90 days from that date. However, this will just signal the start of the avalanche, the bottom will take years to materialize.
The Nevada legislature is overwhelmingly democratic now. The bills on the table are horrendous for property owners and investors. Here are just a few examples:
Assembly Bill 161 – This would eliminate an already difficult eviction process and require something similar to a foreclosure. Property managers would not be able to represent landlords. Expensive attorneys would be required and cases would not be heard for months.
Assembly Bill 141 – This bill would increase the length of the no-cause notice. As you may know, we use this “no cause notice” to get rid of tenants who are naughty. Tenants who have been longer than 1 year but shorter than 3 years, would need a 60 Day Notice. Tenants who have been longer than 3 years would need a 90 Day Notice.
Assembly Bill 218 – This bill would prohibit landlords from collecting an application fee and reduce the amount of money we could charge for normal wear and tear.
What can you do?
Contact your representative today and tell them how ridiculous these bills are!
Click on this link to find your representative.
- Write what you want to say on a note / email so you can copy / paste your complaint.
- There are multiple representatives for each property and be sure to address both 161 and 141.
- Be sure to hit up each representative for each property.
Here is the good news. These idiots have a long way to go to make these real. Below is a detailed process of how it works: