N.J. tried to bail out small landlords. So what went wrong?
Among the pandemic’s worst aftershocks, experts predict, will be a massive wave of evictions. Hundreds of thousands of families across New Jersey lost income and can’t afford their rent. The governor can delay this with a moratorium, but we can’t expect these landlords to live forever without rent payments. It’s only getting worse as winter arrives, and heating bills kick in.
“People are saying, I put my life savings into this property, it was supposed to be for my retirement. It was supposed to be for my kids’ college savings, and now it’s down the toilet,” says David Brogan, head of the New Jersey Apartment Association. “You’re talking about people literally having their life savings evaporate before their eyes.”
Starting in August, the state tried to distribute $25 million among smaller landlords who forgave missed rent payments, to help make them whole again and stop tenants from being forced out. It was one of our first forays into what will be a gigantic evictions war, and it flopped fabulously. Hardly any of the people eligible applied. Only about $4.5 million in grants have been approved, and less than $3 million paid out.
There’s bound to be another wave of money thrown at this pending disaster, so what lessons can we glean before the real tsunami hits?
In all, the state got about 4,400 applications, a tiny fraction of the 46,000 landlords registered with the Department of Community Affairs, who were expected to participate. The Census Bureau’s Household Pulse Survey reports about 25 percent of tenants are behind on rent. On average, each landlord qualified for $5,000.
So why didn’t 90 percent of those eligible apply?
Maybe some preferred to file for evictions, which they can’t do if they get grants, since that is rightfully part of the deal. But mostly, this seems like a failure to get word out. The New Jersey Housing and Mortgage Finance Agency sent postcards to all registered landlords, did webinars with mayors and landlord groups and marketing, including ads on Spanish speaking stations. In the second round, it extended eligibility from a maximum of 10 apartments to 30 and sent postcards out all over again. States like Delaware and New York had similar difficulties, it notes.
Still, New Jersey must do better. Why didn’t the governor hype this at his daily press briefings? Should the program be better advertised? And can’t the landlord’s trade group, the Property Owners Association of New Jersey, do more to inform its own members? Some landlords mistakenly thought they had to submit a separate application for each tenant.
Confusion abounded, the association’s president, Derek Reed, said: “I heard about an instance where a husband and wife had owned the property together, and were on the deed together, but DCA registered only one of them,” he recalled. “Because the deed didn’t match up with the DCA registration, it was denied. And they couldn’t get someone on the phone to talk to, to say, ‘Look, we both own the home.’”
So why didn’t 90 percent of those eligible apply?
Maybe some preferred to file for evictions, which they can’t do if they get grants, since that is rightfully part of the deal. But mostly, this seems like a failure to get word out. The New Jersey Housing and Mortgage Finance Agency sent postcards to all registered landlords, did webinars with mayors and landlord groups and marketing, including ads on Spanish speaking stations. In the second round, it extended eligibility from a maximum of 10 apartments to 30 and sent postcards out all over again. States like Delaware and New York had similar difficulties, it notes.
Still, New Jersey must do better. Why didn’t the governor hype this at his daily press briefings? Should the program be better advertised? And can’t the landlord’s trade group, the Property Owners Association of New Jersey, do more to inform its own members? Some landlords mistakenly thought they had to submit a separate application for each tenant.
Confusion abounded, the association’s president, Derek Reed, said: “I heard about an instance where a husband and wife had owned the property together, and were on the deed together, but DCA registered only one of them,” he recalled. “Because the deed didn’t match up with the DCA registration, it was denied. And they couldn’t get someone on the phone to talk to, to say, ‘Look, we both own the home.’”
Source: nj.com
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