Eviction moratorium hurting owners, from mom-and-pop landlords to property giants

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Property owners across the country, including struggling mom-and-pop operators, are asking the nation’s courts why landlords are expected to take a financial hit while nonpaying tenants are protected by ongoing eviction moratoriums.

Americans who own rental properties say they’re facing the same COVID-19-fueled pressures as their tenants, with bills piling up and cash running low.

Many are now facing bankruptcy and foreclosures because tenants, with the federal government’s protection from eviction, have stopped paying rent.

“Most residential landlords in the country own fewer than five properties, so it’s definitely a myth that most of the people affected by this are big companies, big corporations — majority of the time, it’s mom and pop,” said Caleb Kruckenberg, an attorney with New Civil Liberties Alliance.

“This is their entire livelihood. What people don’t understand is they still have all the same bills.” 

Rick Brown, a landlord in Virginia, is a client of New Civil Liberties Alliance and part of the legal fight unfolding in court cases across the U.S.

“I’m struggling to pay my bills. I’m treading water. I mean it’s a tough deal right now for landlords,” he told CBS. 

Lawsuits challenging the government’s eviction moratorium are piling up, with some district courts delivering wins for the landlords while others have ruled for the government.

There are appeals pending in the 5th U.S. Circuit Court of Appeals, the 11th U.S. Circuit Court of Appeals and the D.C. Circuit Court of Appeals. 

Recently, the 6th U.S. Circuit Court of Appeals invalidated the government’s moratorium but did not issue a nationwide injunction.

The lawyers representing landlords in the D.C. Circuit Court of Appeals won in lower court, but after the government appealed, they are readying to quickly resolve the case and go to the Supreme Court if necessary. 

“This is going to end up in the Supreme Court,” Mr. Kruckenberg said.

“Given the makeup of the current Supreme Court, I think the CDC would lose,” he said, referring to the Centers for Disease Control and Prevention.

Larry Gross, executive director at the Coalition for Economic Survival, said he’s worried about what the 6-3 conservative majority on the high court would do to renters. 

“We are on the track for an economic train wreck,” he said. “During this pandemic, tenants have lost their income flow.”

Minorities, Mr. Gross noted, have been hit the hardest during the pandemic, but he acknowledged small landlords should be afforded mortgage forgiveness as well. 

“Clearly, there needs to be consideration for those small landlords that are facing the situation of not being able to pay,” he said.

The eviction moratorium bans landlords from evicting tenants while the order is enforced, so landlords are unable to remove a renter who can’t pay rent. 

The moratorium was first issued in September under former President Trump, but the government has continued to renew it during the following eight months, even after vaccines have been widely distributed.

Lawyers for the landlords said the latest extension will lapse at the end of June but they fear that won’t happen and the government will renew it again.

Mr. Kruckenberg said all the evictions that have piled up over the past several months will come down at one time, creating a mess that the government made. 

“This is just a political move,” he said. “They have created a disaster they have to deal with.”

The CDC and the Justice Department would not comment on the litigation. 

Sarah Saadian, vice president of public policy at the National Low Income Housing Coalition, said the moratorium is needed for renters to stay in their homes until the government distributes the billions in emergency relief that Congress passed for rental assistance. 

“More than 8 million households are behind on their rent, and these families would be immediately at risk of losing their homes if the eviction moratorium expires before these resources can reach them,” she said. 

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