Why is Rent still due during COVID-19?

328 Replies

Originally posted by @Jonathan R McLaughlin : "...we need to think about the responsibility of landlords to the larger public too."
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The public should pay for public goods. If society is going to strip landlords of their ability to coerce rent payments from tenants, then in fairness society should pay the rent and not externalize the cost onto landlords, who are private parties.

 

Originally posted by @John Clark :

Per Jerry W: "@John Clark , are you saying The Cheesecake factory not paying rent makes it ok for no one else to pay rent? I think the mall owners should be able to evict them if they choose, or not to. Suggesting someone is immoral for insisting upon them performing a contract they agreed to do is pretty judgemental."

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No, Jerry, I was not being judgmental. It was Heather Frosco who called non-paying tenants thieves (shoplifters to be precise). Likening non-paying residential tenants to thieves is what's judgmental. My point was that if residential tenants are thieves, what does that make commercial tenants who are behaving the same way? Heather Frusco wants to give corporations a pass, and I called her out on that.

So I am not saying that if corporations don't pay then no one has to pay. I'm saying that if one is going to label non-paying tenants as criminals, then you have to label all non-paying tenants as criminals.

Heather got the vapors.

I DO consider paying one's bills to be a moral obligation. Heather, for some unknown reason, wants to give corporations a pass. I refuse to give corporations a pass. I also think Heather is being inconsistent in her position, as she is refusing to condemn what she herself has labeledcriminal corporate behavior.

John, again... you are arguing with yourself and getting all flustered; no one has said that. I think you need to take sometime and just go back and re-read posts... you're all wound up and trying very hard to make your point but it's either not being made clearly or no one really cares/agrees, this is now the 5th member that has called you out... you really just need to take a breather, stop complaining and take it for what it is... this is just a simple discussion, relax.  

After spending a few hours reading each post on this thread carefully, I’d like to share a few thoughts.

It is true that land lords should have reserves. I absolutely agree with this. But I also agree that tenants should have reserves too. The most insightful comments in this thread that I have read thus far was what @Jeff Cagle stated when he wrote, “a system produces what it incentivizes.”

As a social worker who has probably had more training in social programs and understanding the mindset of people in poverty or who live in C-class properties than the majority of people on this thread, I am understanding and empathetic to people’s situations and their conditioning and training from childhood. However, as Jeff stated, “a system produces what it incentivizes,” meaning that the more intervention that protects people from struggling though a situation like this, the more we incentivize people to not change behaviors.  The message being sent is that someone (the government) will always step in to save you from consequences (whether self-inflicted or otherwise) therefore no change is necessary.

My theory of finance lies somewhere between Dave Ramsey and Robert Kiyosaki. I believe in the concepts of leveraging to build wealth following the ideas of Robert Kiyosaki, however, I also believe in good financial defense taught by Dave Ramsey through his baby steps program.  If people would have done what Dave Ramsey suggests, having a 3-6 months emergency fund, then this situation could be covered by the American people themselves. This would be considered an appropriate time to use that emergency fund. However, government programs for the poor often do not incentivize people to have a 3-6 months emergency fund. Rather, people who have savings can end up not qualifying or losing assistance eligibility. So the government unincentivizes or deincentivizes people who want to be prepared. If we want to change our country and change mindsets and be more prepared, then this should really be be switched.

The problem with this situation really is the government coming in to tell people that they do not need to fear being evicted if they do not pay rent. In Arizona the length of time is for 120 days.  This information sends the message to all tenants that they have 120 days where they can live in a rental without paying rent. What if one of my tenants only needed 1 month of an adjustment to their rent while another tenant needed 5 months?  For the government, who does not know my business finances, to come in and enable my tenants to not pay rent is similar to highjacking my business.  

Would I evict a ton of people in my rentals if several of them stopped paying rent just because the lease agreement said I could? No, that does not make good business sense.  But let me be the decision maker for my business; not some government entity that knows little to nothing about my business finances.  Again, giving a blanket statement that tenants can not be evicted up to 4 months without paying rent gives many people who don't need 4 months the excuse not to pay, while those who need longer are out of luck. This is just simply not something the government should decide for my business. I'm the business owner, let me decide it.  It's similar to paying a board game like Monopoly and where half way through the game, someone comes along and changes the rules of the game.  You set out understanding the rules and how to win, but now someone completely changes the rules yet you are just supposed to go along with it. Nah, I don't play those games. I don't like games where rules change in the middle of the game.

Also, something to consider is that this stimulus of giving people money won't help the country or the people in the long term.  If we have been on a 10-12 year bull market with the appearance of being prosperous yet we as a people couldn't save 3-6 months of reserves over a 10-12 year period of time, then we have shown that we as a people are bad with money and giving us more money won't save us in the long term.  It appears that we have a spending addiction in the country and more of the drug - money, isn't going to help with the addiction.  It may make things look better or feel better in the short term, but there will be long term negative effects of this.  The government is not going to pull back once this new ground has been taken the government rarely does this.  How does the Reagan quote go "There is nothing quite so permanent as a temporary government program."

Inflation is going to happen (or deflation of the dollar - however you want to look at it). This will eventually really hurt the poor and middle class.  As for me, my properties will go up in value (unless the government goes completely socialist and takes my property to give to the poor). So as long as that doesn't happen, I will get wealthier because my properties will go up in value and the debts that I have on them will be paid back with cheeper dollars.  However, the people who this stimulus is supposed to help will eventually go back to work.  Their wages will continue to increase but not nearly as quickly as inflation.  Their spending habits will remain the same which are to spend money for entertainment to take their minds off of their financial situation and just live hand to mouth day by day; until the next big crisis comes about where they look to the government to come rescue them again. Thus the cycle continues.

What is the main point of all of this.  It's simple.  Government should stay out of the real estate game.  They are not any good at it.  And when they get involved, it usually ends up hurting the people they purpose they are helping.

Samuel Pentowski

"John Clark You seem to have a fixation on Cheesecake Factory and Heather Frosco. I can see what you are trying to say, but I'm finding it difficult to see how her opinion (regardless of what it is) regarding Cheesecake Factory has any bearing on you."
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No, I have no fixation on Cheesecake Factory or Heather Frusco. I have a fixation on those who don't think through their ideas. If Heather wants to call non-paying tenants thieves, she is free to do so. She needs to all all such tenants thieves, though, not just some. She refuses to do so. That is an idiotic position.

"John, again... you are arguing with yourself and getting all flustered; no one has said that. I think you need to take sometime and just go back and re-read posts.."

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No one has said what, Heather? You called non-paying tenants shoplifters (thieves) in your very first post in this thread. I'm not flustered at all. You're the one evading calling nonpaying corporate tenants shoplifters (thieves). Why is that?

Originally posted by @John Clark :

Samuel Pentowski

"John Clark You seem to have a fixation on Cheesecake Factory and Heather Frosco. I can see what you are trying to say, but I'm finding it difficult to see how her opinion (regardless of what it is) regarding Cheesecake Factory has any bearing on you."
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No, I have no fixation on Cheesecake Factory or Heather Frusco. I have a fixation on those who don't think through their ideas. If Heather wants to call non-paying tenants thieves, she is free to do so. She needs to all all such tenants thieves, though, not just some. She refuses to do so. That is an idiotic position. 


John although I appreciate your input but still don't understand your argument, you are repeating yourself over and over, so for the sake of doing the same... again... you are arguing with yourself and getting all flustered; no one has said that. I think you need to take sometime and just go back and re-read posts... you're all wound up and trying very hard to make your point but it's either not being made clearly or no one really cares/agrees, this is now the 5th member that has called you out... you really just need to take a breather, stop complaining and take it for what it is... this is just a simple discussion, relax.

@Shiloh Lundahl I love that you brought up the reference to David Ramsey and Robert Kiyosaki.  It is so true (including the new FIRE group (Financial Independence/Retire Early).  

On your comments on understanding C level property tenants, I think there are some of us who have a very comprehensive study through personal history.  I grew up in that situation and it was a very humbling experience.  It's that experience that carves my choices on giving (and our belief system).  We've helped several people over the years because it's the right thing to do.  I am very ok with helping my tenants out as a part of my belief system and by thinking of how this would have impacted my family when I was young.

That's just my personal view. I believe others should be free to act in manner that supports your belief system and situation.  

Originally posted by @Gary L Wallman :
Originally posted by @Dan Heuschele:
Originally posted by @Gary L Wallman:
Originally posted by @Dan Heuschele:
Originally posted by @David King:
Mary the state school taxes can't be paid late. The state will evict and take my houses. I have to collect over $400 per month to cover a $5,000 school tax on each of 10 properties. That's around $50,000. I am retired so this income is all I have. Please explain how your math works for me? Please don't tell me about how the tenants are going to come to my rescue when they get their jobs back I have way more experience than that. My houses are paid off. I have tried to refinance and they say I don't make enough to pay a mortgage. If you're going to tell me about a fairy tale organization that is going to come to my rescue please post their phone number so I can call them. My wife and I will be out of money if the rent doesn't come in.

Originally posted by @Mary Mitchell:

@Greg M. you left off utilities, mortgage companies, credit cards, banks.....etc.... and all of those are allowing payments to be delayed or added to the back of the amortization... utilities etc take amount owed and split it up over x months...
 

 4 people voted for this post???   You are a LL.   LL is a business.  A well run business has reserves and performs risk management.  Any financial planner would have told you to have 6 months reserve.  Clearly you should not have purchased property #10 (especially for all cash) that left you with zero reserves.  Likely you should not have purchased property #9 (again all cash).   You are the definition of over extended due to property acquisition.  This is something that is warned about everyday on BP and probably about once a week by yours truly.

You have risk due to over leverage.  Now that the risk has become a problem, you act like you played no role in creating the risk.  The reality is you created this high risk situation.  A situation that every financial planner would have pointed out is high risk.  A situation that was pointed out daily on BP as being risky.

I am not saying the tenants are coming to your rescue.  I do suspect that somehow you will be rescued, but your worse than the tenants that have no reserve.  Why?  Because you chose to invest in RE rather than maintain the reserve.  Versus many of the tenants are in their situation not due to having chose to invest the reserve, but because their living expenses do not allow them to create a reserve.

 Dan,

I couldn't disagree with you more (no offense). I have virtually no leverage and lots of reserves. But no amount of reserves is sufficient to offset a huge number of tenants in default. Make no mistake about it it is their default even if it's not entirely their fault.

When one invests in RE we plan (or should plan) for vacancies, cap-ex, taxes and other contingencies. The low rate of return we experience is based on the notion that RE is, by its very nature, a conservative investment. No one should or would expect the contingencies required to offset a large percentage of non-performing tenants. If that were entered into the equation, no one would invest in RE as the returns would be too small for the capital invested.

Let's face it, the government is the only entity large enough too create a buffer for the working folks. They should and that burden will be spread over the entire tax-paying populace.

Gary

 Our rents, including the STRs, are ~$45k.  I do as I preach.   We are in a position to handle an extended period of little/no rent.   We already know our STRs will have $0 rent.   That is ~$16k/month of lost rent. 

Do I want to lose thousands of dollars in lost rents? Of course not! I hope and expect to collect on most of any LTR deferred rent. I also am not expecting most of our tenants to not pay their rent, but I will not know until April 5th or so. I am projecting an 85% LTR rent payment. If I am correct, our rent, including the STR, will be just over $20k less than usual. That is a lot of money to be short in rent. Multiple similar months add up really fast. It will impact us by consuming reserves. It will not impact us by placing any of our RE in jeopardy or by making us not have money for essentials.

So similarly, I disagree with you.  It is possible to have reserves to handle a large number of tenants in default.   I know this because we can.  Certainly we do not want to consume our reserves.   You never know what reserves will be needed for and if they are consumed they should be replenished meaning less money available for vacations, toys, entertainment, and retirement. 

I also do not believe RE should be a low rate of return.   Because we do value adds extracting much of our initial investment, we have achieved outstanding RE returns.  Buy n hold RE is not passive.  If you are not obtain a return significantly better than the lifetime return of the S&P 500 (over 9% prior to this melt down), then you likely need to change something.  

Good luck

 Dan,

My average monthly rent collection is 3 times yours.  I only have 6 mortgages across 120+ doors, and those are ones I inherited through acquisition. I am closing on a 100k house today and a 140k one on the 31st. all cash. The point in this is that I have sufficient reserves to carry me for years and my returns have been excellent.

That being said, why would I want to give it all away now? I don't and I won't.

Good luck to you.

Gary

Your initial post indicated you did not have the reserves to cover a $400/month expense and that the state was going to evict and take your houses.  This was why @Jay Hinrichs indicated you may need to sell a property and it was the part that I was replying to.

Now you indicate you have sufficient reserves (great).  If you had not indicated you did not have reserves for a $400/month expense, I would not have replied indicating that you should have had some reserves and that not doing so was risky.  It now seems that you have reserves which is indicating you agree with the need for reserves (great).

As for "giving it away", We all would prefer to not have to spend reserves to cover for this virus (including me). The reality is that a majority of us will be coming out of this with less net worth (I am way down (over 7 digits) on two of my investment categories not including RE) than prior to this virus. Who would be happy about that? But we should be compassionate to others. I already know that I am down at least $16K in rent (the STR rent) for Mar 11 to April 16. I wish we were not down any of our rent, but it is what it is and we have the reserves that it will not force the sale of anything. We will see over the next 1.5 weeks how our LTR rents do, but I am expecting most of our tenants will pay their entire rent (my guess is we collect 85% of the due LTR rent). My reserves will be taking a hit, the only question is how large of a hit.

I hope your can somehow shield your reserves from taking a hit, but I would suggest not trying to rely on doing so.

Good luck

Originally posted by @Mary M. :

Hopefully that bill wont pass..... that is unfair to tenants and landlords....  disallowing evictions for tenants affected by the coronavirus makes sense to me given the relief funds that are available.....   would be calling my representatives and letting them know loud and clear this is not a good solution ( i cant believe it will pass, esp with the funding available soon)

 

Unfortunately, NYS government has not had much in the way of logic towards landlord/tenant issues as of late.  I and a bunch of others in the business did reach out to our representatives, but unfortunately these are politicians and they play to the demographics.  There are way more of their constituents that are renters than landlords, and the voting demographics  seem to be their primary focus. 

The comments under the bill are trending more towards renters with misinformation about the economics of landlording than equity during the crisis.

@Account Closed Well said.  I don't want to get political on this forum but I think you'd be blind to think that whichever party you've backed is working for you harder than their own pocket.  We need a 3rd party (damn I got political)

@Shiloh Lundahl , preach it brother!  Well said! I just spent the last 2 hours reading everyone's post on this thread and was going to write my 2 cents but after reading yours there is nothing I could say that would add any value outside of what you said!  Well  said once again Sir!

Originally posted by @Dan Heuschele :
Originally posted by @Gary L Wallman:
Originally posted by @Dan Heuschele:
Originally posted by @Gary L Wallman:
Originally posted by @Dan Heuschele:
Originally posted by @David King:
Mary the state school taxes can't be paid late. The state will evict and take my houses. I have to collect over $400 per month to cover a $5,000 school tax on each of 10 properties. That's around $50,000. I am retired so this income is all I have. Please explain how your math works for me? Please don't tell me about how the tenants are going to come to my rescue when they get their jobs back I have way more experience than that. My houses are paid off. I have tried to refinance and they say I don't make enough to pay a mortgage. If you're going to tell me about a fairy tale organization that is going to come to my rescue please post their phone number so I can call them. My wife and I will be out of money if the rent doesn't come in.

Originally posted by @Mary Mitchell:

@Greg M. you left off utilities, mortgage companies, credit cards, banks.....etc.... and all of those are allowing payments to be delayed or added to the back of the amortization... utilities etc take amount owed and split it up over x months...
 

 4 people voted for this post???   You are a LL.   LL is a business.  A well run business has reserves and performs risk management.  Any financial planner would have told you to have 6 months reserve.  Clearly you should not have purchased property #10 (especially for all cash) that left you with zero reserves.  Likely you should not have purchased property #9 (again all cash).   You are the definition of over extended due to property acquisition.  This is something that is warned about everyday on BP and probably about once a week by yours truly.

You have risk due to over leverage.  Now that the risk has become a problem, you act like you played no role in creating the risk.  The reality is you created this high risk situation.  A situation that every financial planner would have pointed out is high risk.  A situation that was pointed out daily on BP as being risky.

I am not saying the tenants are coming to your rescue.  I do suspect that somehow you will be rescued, but your worse than the tenants that have no reserve.  Why?  Because you chose to invest in RE rather than maintain the reserve.  Versus many of the tenants are in their situation not due to having chose to invest the reserve, but because their living expenses do not allow them to create a reserve.

 Dan,

I couldn't disagree with you more (no offense). I have virtually no leverage and lots of reserves. But no amount of reserves is sufficient to offset a huge number of tenants in default. Make no mistake about it it is their default even if it's not entirely their fault.

When one invests in RE we plan (or should plan) for vacancies, cap-ex, taxes and other contingencies. The low rate of return we experience is based on the notion that RE is, by its very nature, a conservative investment. No one should or would expect the contingencies required to offset a large percentage of non-performing tenants. If that were entered into the equation, no one would invest in RE as the returns would be too small for the capital invested.

Let's face it, the government is the only entity large enough too create a buffer for the working folks. They should and that burden will be spread over the entire tax-paying populace.

Gary

 Our rents, including the STRs, are ~$45k.  I do as I preach.   We are in a position to handle an extended period of little/no rent.   We already know our STRs will have $0 rent.   That is ~$16k/month of lost rent. 

Do I want to lose thousands of dollars in lost rents? Of course not! I hope and expect to collect on most of any LTR deferred rent. I also am not expecting most of our tenants to not pay their rent, but I will not know until April 5th or so. I am projecting an 85% LTR rent payment. If I am correct, our rent, including the STR, will be just over $20k less than usual. That is a lot of money to be short in rent. Multiple similar months add up really fast. It will impact us by consuming reserves. It will not impact us by placing any of our RE in jeopardy or by making us not have money for essentials.

So similarly, I disagree with you.  It is possible to have reserves to handle a large number of tenants in default.   I know this because we can.  Certainly we do not want to consume our reserves.   You never know what reserves will be needed for and if they are consumed they should be replenished meaning less money available for vacations, toys, entertainment, and retirement. 

I also do not believe RE should be a low rate of return.   Because we do value adds extracting much of our initial investment, we have achieved outstanding RE returns.  Buy n hold RE is not passive.  If you are not obtain a return significantly better than the lifetime return of the S&P 500 (over 9% prior to this melt down), then you likely need to change something.  

Good luck

 Dan,

My average monthly rent collection is 3 times yours.  I only have 6 mortgages across 120+ doors, and those are ones I inherited through acquisition. I am closing on a 100k house today and a 140k one on the 31st. all cash. The point in this is that I have sufficient reserves to carry me for years and my returns have been excellent.

That being said, why would I want to give it all away now? I don't and I won't.

Good luck to you.

Gary

Your initial post indicated you did not have the reserves to cover a $400/month expense and that the state was going to evict and take your houses.  This was why @Jay Hinrichs indicated you may need to sell a property and it was the part that I was replying to.

Now you indicate you have sufficient reserves (great).  If you had not indicated you did not have reserves for a $400/month expense, I would not have replied indicating that you should have had some reserves and that not doing so was risky.  It now seems that you have reserves which is indicating you agree with the need for reserves (great).

As for "giving it away", We all would prefer to not have to spend reserves to cover for this virus (including me). The reality is that a majority of us will be coming out of this with less net worth (I am way down (over 7 digits) on two of my investment categories not including RE) than prior to this virus. Who would be happy about that? But we should be compassionate to others. I already know that I am down at least $16K in rent (the STR rent) for Mar 11 to April 16. I wish we were not down any of our rent, but it is what it is and we have the reserves that it will not force the sale of anything. We will see over the next 1.5 weeks how our LTR rents do, but I am expecting most of our tenants will pay their entire rent (my guess is we collect 85% of the due LTR rent). My reserves will be taking a hit, the only question is how large of a hit.

I hope your can somehow shield your reserves from taking a hit, but I would suggest not trying to rely on doing so.

Good luck

 Dan,

Not my original post. You're mistaken.

Gary

Originally posted by @Account Closed :

I know you are out there.  Landlords who are running on fumes.   Mortgage companies do accept Credit Cards.  If they dont go get a cash advance and the pay Mortgage.

The economy isnt all or nothing.  Example 5,000 room hotel might only open 500 rooms to start.  Maybe fully operational a year from now.  

Its going to hurt.

A lot of mortgage companies do not take credit cards and for some of those that do, VISA will not allow the card to be used to pay rent/utilities. 

Originally posted by @John Clark :
Heather, you don't play being obtuse very well. If you call nonpaying tenants thieves then you have to call all of them thieves. You refuse to do so. You're a corporate shill.

John,

This may be the most illogical post I have ever read.  Heather's posts are anything but obtuse. People who attempt to steal services are thieves. Those who don't aren't.

I watched a pair of people on video yesterday. They walked into a drug store, emptied shelves into backpacks and left without paying. Using your logic, the other shoppers must be thieves too.

No disrespect, but IMO you are way, way off base.

Godspeed.

 

@Shiloh Lundahl Thanks for your well thought out post. Just a few thoughts:

1) The purpose of the government relief package is not long term and is intended to prevent our economy/way of life collapsing in the short term. No one could have predicted that a large swath of Americans would lose their income essentially immediately. This thread is about issues relating to real estate investment in the context of covid 19 yet many posts are using arguments as if we are in a normal business environment. So I'm not sure how relevant long term economic arguments are and makes me wonder if many people here don't grasp the scope of the crisis. The Senate voted for cash payments to the majority Americans with unanimous bipartisan support. These are not normal times and will likely dwarf the financial crisis in terms of economic impact. 

2) The government is in the real estate game and has been for some time with massive benefits to property owners that renters do not see. Preferential taxation on capital gains, mortgage interest deductions, government backed loans, the list goes on and on. To take advantage of these substantial benefits and then decry the government trying to help out renters in the midst of a period of unprecedented economic uncertainty doesn't make sense to me.

Originally posted by @Aylssa Feliciano:

Another perspective...

I’m a renter. A currently unemployed server.

I have no intentions of not paying rent because I have money saved, which is supposed to be for my first real estate investment. My landlord has a net worth of 1.4 million (he told me while installing a new washer.) I’m sure losing a months rent probably would not hurt him. But I will continue to pay rent because I’m a responsible adult and you pay bills when they are due.

That being said if this pandemic happened a few short years ago, I would be in big trouble. No savings, living paycheck to paycheck, no money management skills what so ever. Sadly, that last sentence is normal for many Americans.

Every situation is going to be different. There will be tenants that try to take advantage of this mess. Shame on them.

Then there are responsible honest tenants that are doing their best and just need a break. They could also probably use some financial advice. Take heart.

 Alyssa, I would imagine being a Tenant posting on this thread would be much like going into a hornets nest but you are from the sounds of it.... an A class tenant and from what I gather from your post just a good and responsible person in general. One thing that is apparently clear in your post is your sense of responsibility for 'your' situation and your commitment to take it on yourself. You and tenants like you are exactly who I am referring to when I write '...for only [good tenants] that truly absolutely need it...' - when I see a Tenant such as yourself that has done everything right and then continues to make up payments during this time, using all of the options available and keeps me informed throughout the process - that is someone in my opinion which has tried and exhausted everything they possibly could for as long as they could to make good... but then if by chance is still not able to or comes up short, not due to lack of trying or preparation... that is exactly the type of Tenant that absolutely needs my (LL) assistance, if the LL is able to provide it. We're not talking about an entitlement and we're not talking about entitlement mentality tenants (those are on their own) ; we're talking about saving limited resources and deploying them to only those which absolutely need them after they have exhausted all of their options, but again that does depend from LL to LL and what if any, assistance they can offer to Tenants such as yourself, some can and some just can't, some will and some won't - the decision is completely theirs to make. 

Originally posted by @Dan Heuschele :
Originally posted by @Jay Hinrichs:
Originally posted by @David King:

Heather gets it, finally someone who gets it! As far as the tenant paying later, that's an absolute joke. The tenants wint pay a penny later. 

depending on asset class totally agree.. any lost rent is lost for good in the service work force housing sector.. white collar maybe not.

I seldom disagree with Jay, but I am confident that a mass majority of our C class tenants will make good on any rent they are short through this crisis.  How sure?  If I am wrong, I offer to take Jay to a steakhouse for dinner next time he is in San Diego.  Not a wager, I am not expecting anything from Jay if I am correct.  I have faith in our tenants.  We screen well and we build expectations.  

For missed rent payback: We were thinking one year payback time for up to 2 months missed, and 18 months if they are 3 months rent behind.  So it could be a while before I know if I am correct.

Related, I am expecting to receive a very large majority of our April LTR rents (probably none of the STR rents for most of March and all of April). I have communicated to the wife that I am predicting 85% of the total LTR rent. So far 2 tenants have contacted us about issues. They are both indicating that they will be paying the majority of their rent on time. We will know in about a week how accurate my 85% estimate is. We require just under 50% LTR rents to pay our rental mortgages but that includes the STR that will be getting virtually $0 rent.

 The problem I'd have is most of our tenants, if they get too far behind, won't want to pay extra to get caught up.  There is little downside to them just bailing on their balance and starting fresh somewhere else.  Lots of small owners don't check rental/credit history and will move them in for $200 or so. 

Originally posted by @Eddie T. :
Originally posted by @Miguel Sanchez:

@Heather Frusco I guess it depends on your state. In New York rent and mortgages are suspended for 90 days.

You are wrong sir their is no suspension of rent in NY, that is a bad rumor being spread. 


I wish it were a rumor.

There is a bill moving through both the upper and lower chambers in NYS that is looking to make that a reality.  It was drafted on Monday, and as of today it has 21 co-sponsors in the Senate.  At the rate they are going, it will be voted on next week.

https://www.nysenate.gov/legislation/bills/2019/s8125?fbclid=IwAR3pDKVhZZyW2fSc8jG5Y3YVfsVs96xFtz3EJOSfowLMM1bwcUymImrKNsA