{"id":136932,"date":"2021-04-14T11:30:00","date_gmt":"2021-04-14T17:30:00","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=136184"},"modified":"2024-02-20T16:09:12","modified_gmt":"2024-02-20T23:09:12","slug":"rent-relief-plans","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/rent-relief-plans","title":{"rendered":"Beyond the Pandemic: How Rent Relief Plans Can Boost the Rental Economy"},"content":{"rendered":"\n\n      <iframe loading=\"lazy\" frameborder=\"0\" height=\"200\" scrolling=\"no\" src=\"https:\/\/playlist.megaphone.fm?e=BIGPOC9505098785&#038;light=false\" width=\"100%\"><\/iframe>  \n\n\n\n\n<p>The COVID-19 pandemic has shown many people the importance of being ready for the worst. Landlords have been negotiating with struggling tenants to create rent relief plans. The federal government has placed moratoriums on evictions and foreclosures. The pandemic (and the legislative response) has left both owners and tenants wondering if their contracts are still binding.<\/p>\n\n\n\n<p>While the COVID-19 vaccine is rolling out, you, as a landlord and real estate investor, are probably worried about maintaining your properties and paying your mortgage. Meanwhile, unemployment numbers are at record highs; your tenants are worried about their own financial futures and may be unable to pay rent.<\/p>\n\n\n\n<p>It is important to know that complaints of nonpayment may be exaggerated\u2014the National Multifamily Housing Council <a href=\"https:\/\/www.nmhc.org\/research-insight\/nmhc-rent-payment-tracker\/\" class=\"rank-math-link\" target=\"_blank\" rel=\"noopener\">found that 93.5% of renters<\/a> paid February 2021 rent in full.<\/p>\n\n\n\n<p>In the months to come, some real estate sectors, including hospitality and apartment REITs, could experience strong demand. The outlook for other sectors is mixed.<\/p>\n\n\n\n<p>How can you as a landlord balance your own financial needs with your tenants&#8217; to give both of you a way through challenging circumstances?<\/p>\n\n\n\n<p>How prepared is your business for when things head south?<\/p>\n\n\n\n<hr class=\"wp-block-separator has-css-opacity\"\/>\n\n\n\n<div id=\"hero-block_62ee867235a1c\" class=\"first:mt-0 hero-block py-4    has-background has-slate-300-background-color has-text-color has-slate-800-color\">\n    <div\n        class=\"gap-10 lg:gap-20 flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n\n        <div class=\"relative z-30 lg:w-2\/3 \">\n            <main class=\"py-4\">\n                \n\n<p class=\"has-theme-slate-color has-text-color has-large-font-size\" style=\"font-style:normal;font-weight:800\">Prepare for a market shift<\/p>\n\n\n\n<p class=\"my-3 md:my-5 lg:my-8 has-theme-slate-color has-text-color\" style=\"font-size:16px\">Modify your investing tactics\u2014not only to survive an economic downturn, but to also thrive! Take any recession in stride and never be intimidated by a market shift again with <em><a class=\"rank-math-link\" href=\"https:\/\/store.biggerpockets.com\/products\/recession-proof-real-estate-investing?utm_source=blog&amp;utm_medium=blog%20banner\" target=\"_blank\">Recession-Proof Real Estate Investing<\/a><\/em>.<\/p>\n\n\n\n<div id=button-custom-event-block_64138705d4d27 class='button-custom-event'>\n      <a href=\"https:\/\/store.biggerpockets.com\/products\/recession-proof-real-estate-investing?utm_source=blog&#038;utm_medium=marketing_block\" x-on:click=\"window.analytics.track(&#039;Blog Block | Publishing: Recession Proof Book&#039;, {\n      referrer: &#039;https:\/\/www.biggerpockets.com\/blog\/rent-relief-plans&#039;,\n    });\" class=\" btn-shape inline-block no-underline has-background has-theme-blue-background-color has-text-color has-white-color\" target=\"_blank\">Get Yours Now<\/a>\n  <\/div>\n\n            <\/main>\n        <\/div>\n\n                <div class=\"lg:w-1\/3 first:mt-0 relative h-full lg:flex lg:items-center\">\n            <img decoding=\"async\" class=\"object-cover w-full relative z-20 my-0  rounded-md hidden lg:block\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/04\/recession-proof.png\" alt=\"\" title=\"\">\n        <\/div>\n            <\/div>\n<\/div>\n\n\n<hr class=\"wp-block-separator has-css-opacity\"\/>\n\n\n\n<h2 class=\"wp-block-heading\">Challenges property owners are facing<\/h2>\n\n\n\n<p>There are three significant problems that you are likely to experience as a landlord during a recession.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It becomes more difficult to collect rent.<\/li>\n\n\n\n<li>Old tenants might want to vacate.<\/li>\n\n\n\n<li>It is more difficult to find new tenants.<\/li>\n<\/ul>\n\n\n\n<p>These problems will continue to dog landlords struggling to recover their footing after the pandemic.<\/p>\n\n\n\n<p>As a landlord, the best way you can prepare for a market downturn is to have policies and processes ready to implement and clearly communicated to your tenants. This gives you a legal and financial grounding in the event of economic recession or downturns in specific markets. Additionally, your tenants will know their options ahead of time.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Types of rent relief plans<\/h2>\n\n\n\n<p>One of the possible processes is to have a rent modification arrangement on standby. You can also create plans to handle garbage, water, and any other bills when rent is no longer as reliable.<\/p>\n\n\n\n<p>One of the common incidents you are most likely going to experience during a long recession is your tenants requesting rent relief. There are several strategies to approach this as a landlord.<\/p>\n\n\n\n<p>These include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Rent deferral.<\/strong> In a rent deferral, you can choose to defer a tenant\u2019s rent until a later time. Based on your agreement with the tenant, the deferred rent can be paid in smaller installments or in a single bulk payment. Another approach to this is to create a cap on operating expenses over a set period.<\/li>\n\n\n\n<li><strong>Rent reduction.<\/strong> You can also choose to reduce a tenant\u2019s rent for all or some part of the total amount of time they have left on their lease. This reduction can be on either the base rent or the operating expenses.<\/li>\n\n\n\n<li><strong>Loan conversion.<\/strong> This is converting the past due rent of a tenant into a repayable loan over a longer set period. Loan conversion is evidenced by a promissory note cross-defaulted with the tenant\u2019s lease.<\/li>\n\n\n\n<li><strong>Rent abatement.<\/strong> This is another strategy used if the client is due on several past payments. In rent abatement, you can choose to simply forgive some or all of the delinquent rent.<\/li>\n<\/ul>\n\n\n\n<p>Regardless of the approach you choose in handling rent relief, it is important to look out for the tax implications. Apart from this, you should also perform due diligence. Check out recent and previous financial records of the tenant to ensure you do not leave out any loopholes in the process.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why is rent relief important?<\/h2>\n\n\n\n<p>As much as possible, you should try to find a workable package. It is important to be understanding and retain good tenants using any of the strategies listed above.<\/p>\n\n\n\n<p>Generally, tenants found defaulting are not considered for most relief considerations. However, the circumstances of the recession might not make this workable, as most tenants are already in or would soon be in default when requesting rent relief. Document everything, and clearly spell out all details of any arrangement you and your tenants make.<\/p>\n\n\n\n<p>The effects of a recession can be severe for everyone. If tenants are no longer able to keep up with their rent, making your maintenance and mortgage payments can become difficult. This is why it is often advised to have a contingency plan to pay these bills. With the proper preparation, flexibility, and good tenant communication, you can come out of recession stronger as a landlord.<\/p>\n\n\n\n  <div id=\"posts_lists-block_606e1fb98c465\" class=\"  my-10\">\n    <div class=\"\">\n      <!-- Column One -->\n      <div>\n                  <h2 class=\"mt-0 mb-1 js-toc-ignore\">\n            More on rent at BiggerPockets          <\/h2>  \n                  \n        \n        \n        <div class=\"grid grid-cols-1 gap-y-4 lg:gap-y-7 mt-5\">\n          \n<article \n\tid=\"post-117661\" \n\tclass=\"content-card mb-0 flex flex-col  post-117661 post type-post status-publish format-standard has-post-thumbnail hentry category-landlording category-biggerpockets-daily tag-landlording tag-rent\">\n\n\t<header class=\"entry-header\">\t\t\t\n\t\t<!-- Image -->\n        \t\t\t<a class=\"post-thumbnail\" href=\"https:\/\/www.biggerpockets.com\/blog\/how-much-to-charge-for-rent\" target=\"_blank\" aria-hidden=\"true\" tabindex=\"-1\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"338\" height=\"225\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/07\/how-much-to-charge-for-rent.png\" class=\"size-card w-full  m-0 aspect-[68\/45] object-scale-down wp-post-image\" alt=\"How Much Rent Should I Charge: 2024 Landlord&#8217;s Guide\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/07\/how-much-to-charge-for-rent.png 1360w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/07\/how-much-to-charge-for-rent-300x200.png 300w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2020\/07\/how-much-to-charge-for-rent-1024x682.png 1024w\" sizes=\"auto, (max-width: 338px) 100vw, 338px\" title=\"\">\t\t\t<\/a>\n\t\t        \n\n\t\t<!-- Content Wrapper -->\n\t\t<div class=\"py-4 \">\t\n                            <div class=\"flex gap-4 justify-between items-center\">\n                    <!-- Category  -->\n                                            <a href=\"https:\/\/www.biggerpockets.com\/blog\/category\/managing-scaling\/landlording\" class=\"transition-colors bg-themeBlue\/20 text-themeBlue-medium hover:bg-themeBlue hover:text-white px-2 py-1 mb-2 inline-block rounded-sm no-underline text-sm\" target=\"_blank\">Landlording &amp; Property Management<\/a>\n                    \n                                            <span class=\"text-sm text-gray-500 hidden lg:inline-block\">8 min read<\/span>\n                                    <\/div>\n            \n           <div class=\"flex gap-3 items-center my-2 flex-nowrap text-base\">\n                <!-- Avatar and Author Name -->\n                <img decoding=\"async\" src=\"https:\/\/secure.gravatar.com\/avatar\/9aabd644b4873fad6fb444b68352070b20998c463fb97473da70a61bdc38d4fd?s=150&#038;d=mp&#038;r=g\" class=\"w-8 h-8 object-cover my-0 inline-block rounded-full\" alt=\"\" title=\"\"><span class='leading-snug text-slate-500 flex items-center'><span class='hidden whitespace-nowrap sm:inline-block md:hidden lg:inline-block pr-1'><span class='posted-on'><time class=\"entry-date published\" datetime=\"2021-02-18T09:30:16-07:00\">Feb 18, 2021<\/time><time class=\"updated\" datetime=\"2024-03-26T18:57:23-06:00\">Mar 26, 2024<\/time><\/span><\/span>&nbsp;<a href=\"https:\/\/www.biggerpockets.com\/blog\/contributors\/cyrus-vanover\" class=\"no-underline line-clamp-1\" target=\"_blank\">Cyrus Vanover<\/a><\/span>            <\/div>\n\n            <!-- Post title -->\n\t\t\t<h2 class=\"entry-title js-toc-ignore mt-4 mb-0 text-xl leading-snug text-left\">\n\t\t\t\t<a href=\"https:\/\/www.biggerpockets.com\/blog\/how-much-to-charge-for-rent\" rel=\"bookmark\" class=\"whitespace-normal no-underline font-bold  text-slate visited:text-slate hover:text-themeBlue\" target=\"_blank\">\n\t\t\t\t\tHow Much Rent Should I Charge: 2024 Landlord&#8217;s Guide\t\t\t\t<\/a>\n\t\t\t<\/h2>\n\t\t\t\n                        <p class=\"text-lg font-normal mt-3 text-slate-500 mb-1 line-clamp-3\">An optimized rental price is a critical factor in property management. How do you effectively manage your property or your property management team to achieve the best outcome? Here are&hellip;<\/p>\n\t\t<\/div>\n\t<\/header>\n     <footer class=\"flex justify-between mt-auto\">\n        <!-- Comment Count -->\n        \t\t<span class='flex items-center space-x-2 text-sm' x-cloak x-data='commentCount()' :class=\"parseFloat(commentCount) < 1 || commentCount == '' ? 'hidden' : 'flex'\">\n\t\t\n            <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"h-5 w-5 text-slate text-opacity-50\" fill=\"none\" viewBox=\"0 0 24 24\" stroke=\"currentColor\">\n                <path stroke-linecap=\"round\" stroke-linejoin=\"round\" stroke-width=\"2\" d=\"M17 8h2a2 2 0 012 2v6a2 2 0 01-2 2h-2v4l-4-4H9a1.994 1.994 0 01-1.414-.586m0 0L11 14h4a2 2 0 002-2V6a2 2 0 00-2-2H5a2 2 0 00-2 2v6a2 2 0 002 2h2v4l.586-.586z\" \/>\n            <\/svg>\n\n            <span x-ref=\"comment_count\" class=\"disqus-comment-count text-slate text-opacity-80\" data-disqus-identifier=\"117661\">\n\t\t\t\t\t\t\t<\/span>\n        <\/span>\n\t    <\/footer>\n<\/article><!-- #post-117661 -->\n<article \n\tid=\"post-135636\" \n\tclass=\"content-card mb-0 flex flex-col  post-135636 post type-post status-publish format-standard has-post-thumbnail hentry category-landlording category-biggerpockets-daily tag-landlording tag-rent\">\n\n\t<header class=\"entry-header\">\t\t\t\n\t\t<!-- Image -->\n        \t\t\t<a class=\"post-thumbnail\" href=\"https:\/\/www.biggerpockets.com\/blog\/flexible-rent-payments\" target=\"_blank\" aria-hidden=\"true\" tabindex=\"-1\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"338\" height=\"225\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/02\/Flexible-rent.png\" class=\"size-card w-full  m-0 aspect-[68\/45] object-scale-down wp-post-image\" alt=\"Trouble Collecting Rent on Time? Try Flexible Rent Payments\" srcset=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/02\/Flexible-rent.png 1360w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/02\/Flexible-rent-300x200.png 300w, https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/02\/Flexible-rent-1024x682.png 1024w\" sizes=\"auto, (max-width: 338px) 100vw, 338px\" title=\"\">\t\t\t<\/a>\n\t\t        \n\n\t\t<!-- Content Wrapper -->\n\t\t<div class=\"py-4 \">\t\n                            <div class=\"flex gap-4 justify-between items-center\">\n                    <!-- Category  -->\n                                            <a href=\"https:\/\/www.biggerpockets.com\/blog\/category\/managing-scaling\/landlording\" class=\"transition-colors bg-themeBlue\/20 text-themeBlue-medium hover:bg-themeBlue hover:text-white px-2 py-1 mb-2 inline-block rounded-sm no-underline text-sm\" target=\"_blank\">Landlording &amp; Property Management<\/a>\n                    \n                                            <span class=\"text-sm text-gray-500 hidden lg:inline-block\">4 min read<\/span>\n                                    <\/div>\n            \n           <div class=\"flex gap-3 items-center my-2 flex-nowrap text-base\">\n                <!-- Avatar and Author Name -->\n                <img decoding=\"async\" src=\"https:\/\/bp-wp-migration.s3.amazonaws.com\/author_avatars\/612767.jpg\" class=\"w-8 h-8 object-cover my-0 inline-block rounded-full\" alt=\"\" title=\"\"><span class='leading-snug text-slate-500 flex items-center'><span class='hidden whitespace-nowrap sm:inline-block md:hidden lg:inline-block pr-1'><span class='posted-on'><time class=\"entry-date published\" datetime=\"2021-03-10T13:30:22-07:00\">Mar 10, 2021<\/time><time class=\"updated\" datetime=\"2024-01-27T11:36:36-07:00\">Jan 27, 2024<\/time><\/span><\/span>&nbsp;<a href=\"https:\/\/www.biggerpockets.com\/blog\/contributors\/remen-okoruwa\" class=\"no-underline line-clamp-1\" target=\"_blank\">Remen Okoruwa<svg class=\"h-5 inline ml-2\" viewBox=\"0 0 21 21\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\"><g clip-path=\"url(#a)\"><path d=\"M19.253 5.25a1.75 1.75 0 0 0-1.663 2.29l-1.42.902a2.188 2.188 0 0 1-2.868-.46L11.91 6.28a1.73 1.73 0 0 0 .342-1.03 1.75 1.75 0 1 0-3.5 0c0 .37.12.732.34 1.03L7.701 7.982a2.188 2.188 0 0 1-2.868.46l-1.42-.903a1.75 1.75 0 1 0-1.816 1.203l1.035 6.205a.438.438 0 0 0 .43.366H17.94a.437.437 0 0 0 .431-.366l1.035-6.204a1.75 1.75 0 0 0-.153-3.494Z\" fill=\"#FFC107\"\/><path d=\"M10.502 17.064c4.108 0 7.438-.98 7.438-2.188 0-1.208-3.33-2.188-7.438-2.188-4.109 0-7.439.98-7.439 2.188 0 1.208 3.33 2.188 7.439 2.188Z\" fill=\"#FFA000\"\/><path d=\"M10.502 17.501c-3.915 0-7.877-.901-7.877-2.625s3.962-2.625 7.877-2.625c3.914 0 7.876.9 7.876 2.625 0 1.724-3.962 2.625-7.876 2.625Zm0-4.375c-4.597 0-7.001 1.137-7.001 1.75s2.404 1.75 7 1.75c4.597 0 7.002-1.138 7.002-1.75 0-.613-2.405-1.75-7.001-1.75Z\" fill=\"#FFD54F\"\/><\/g><defs><clipPath id=\"a\"><path fill=\"#fff\" d=\"M0 0h21v21H0z\"\/><\/clipPath><\/defs><\/svg><\/a><\/span>            <\/div>\n\n            <!-- Post title -->\n\t\t\t<h2 class=\"entry-title js-toc-ignore mt-4 mb-0 text-xl leading-snug text-left\">\n\t\t\t\t<a href=\"https:\/\/www.biggerpockets.com\/blog\/flexible-rent-payments\" rel=\"bookmark\" class=\"whitespace-normal no-underline font-bold  text-slate visited:text-slate hover:text-themeBlue\" target=\"_blank\">\n\t\t\t\t\tTrouble Collecting Rent on Time? Try Flexible Rent Payments\t\t\t\t<\/a>\n\t\t\t<\/h2>\n\t\t\t\n                        <p class=\"text-lg font-normal mt-3 text-slate-500 mb-1 line-clamp-3\">Allowing tenants to pay rent on their schedule has tremendous benefits both for you and your tenants. Learn why and how to implement it.<\/p>\n\t\t<\/div>\n\t<\/header>\n     <footer class=\"flex justify-between mt-auto\">\n        <!-- Comment Count -->\n        \t\t<span class='flex items-center space-x-2 text-sm' x-cloak x-data='commentCount()' :class=\"parseFloat(commentCount) < 1 || commentCount == '' ? 'hidden' : 'flex'\">\n\t\t\n            <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"h-5 w-5 text-slate text-opacity-50\" fill=\"none\" viewBox=\"0 0 24 24\" stroke=\"currentColor\">\n                <path stroke-linecap=\"round\" stroke-linejoin=\"round\" stroke-width=\"2\" d=\"M17 8h2a2 2 0 012 2v6a2 2 0 01-2 2h-2v4l-4-4H9a1.994 1.994 0 01-1.414-.586m0 0L11 14h4a2 2 0 002-2V6a2 2 0 00-2-2H5a2 2 0 00-2 2v6a2 2 0 002 2h2v4l.586-.586z\" \/>\n            <\/svg>\n\n            <span x-ref=\"comment_count\" class=\"disqus-comment-count text-slate text-opacity-80\" data-disqus-identifier=\"135636\">\n\t\t\t\t\t\t\t<\/span>\n        <\/span>\n\t    <\/footer>\n<\/article><!-- #post-135636 -->        <\/div>\n      <\/div>\n    <\/div>\n  <\/div>\n\n  ","protected":false},"excerpt":{"rendered":"<p>How can landlords balance their financial needs with their tenants&#8217; to give both parties a way through challenging circumstances? A rent relief plan may be the answer.<\/p>\n","protected":false},"author":23983,"featured_media":137223,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7119,7384],"tags":[1606,7224,7228,5546],"class_list":["post-136932","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-biggerpockets-daily","category-politics-policy","tag-landlording","tag-landlording-rental-properties","tag-real-estate-comm","tag-tenant-relations"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/136932","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/23983"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=136932"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/136932\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/137223"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=136932"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=136932"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=136932"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}