EVICTION MORATORIUM UPDATE

Paley Commercial Real Estate is your reliable source for information regarding Covid-19 and it’s impact on real estate in the San Fernando Valley and Los Angeles area.

Starting on March 4th Los Angeles County implemented a temporary eviction moratorium to protect tenants unable to pay rent due to the pandemic. In addition to banning evictions for non-payment of rent, the moratorium also stated that Landlords are not allowed to charge late fees and tenants will have a period of time after the moratorium is lifted to pay any back rent. The temporary moratorium was originally set to expire June 23, but has now been extended until July 31, 2020. The Board of Supervisors is permitted to extend the eviction moratorium on a month to month basis as they see fit.

With July 31st right around the corner, many tenants are worried about being able to make ends meet and coming up with enough money for rent. With unemployment rates in Los Angeles at a record high, many individuals were relying on receiving unemployment from the EDD, which includes an extra $600 per week for Covid relief. With the $600 stipend also set to expire at the end of the month, tenants are waiting to see what sort of relief the government will offer.

This week LA City council rolled out a citywide Emergency Rental Assistance Subsidy Program to aid tenants in paying their rent starting August 2020. The program has allocated just over $1 million to assist residential tenants with paying their rent. Tenants must apply for the program through the Los Angeles Housing and Community Investment Department. Because of limited funding, only an estimated 50,000 households will receive the money for rent. The applicants will be chosen at random based on a lottery and those who are selected will have their rent paid directly by the city to their Landlord.

So now we have to broach the question what will happen if the eviction moratorium is not extended and if individuals are not able to continue receiving financial aid from unemployment or the subsidy program. As of now if nothing is extended, beginning August 1, 2020 commercial and residential tenants will have to resume paying rent as outlined in the terms of their lease. Residential tenants and commercial tenants with nine or less employees will have 12 months to pay any back rent. Commercial tenants with more than ten and less than one hundred employees will have six months to pay any back rent. Commercial tenants with over 100 employees were expected to pay back rent by June 1, 2020.

Individuals without income or with limited cash flow, anxiously await to see what will be done by the government. Without some sort of relief Los Angeles will surely face an unprecedented amount of eviction proceedings, vacancies, and homelessness.

Paley Real Estate will continue to update our community regarding any new announcements and news regarding the above. Whether you are a Tenant or Landlord please feel free to reach out to our offices for more information. We will use our 35 years of experience to help assist you in any way we can.