Eviction Moratorium Wars

By
Education & Training with The Lones Group, Inc.

The Lones Group, Inc.

Eviction Moratorium Wars

There is mass confusion right now over the Federal and State eviction moratoriums brought on by the COVID pandemic. It is critical that agents fully understand how these moratoriums affect their clients. I will try to lay the facts out in a simple manner as to simplify what is going on right now, but know that things may change quickly in the coming days and weeks. Stay informed as things unfold. Here is the current state of affairs:

Wednesday May 5th

A federal judge struck down the nationwide eviction moratorium that was imposed by the Trump administration last year and then extended by the Biden administration until June 30th 2021. Judge Friedrich of the U.S. District Court for the District of Columbia was the judge who made the ruling.

Later That Same Day

The Justice Department then immediately filed an appeal and requested an emergency stay on the order until the issue could be heard by a higher court.

(Much) Later Wednesday Night

Late (extremely late) on Wednesday evening Judge Friedrich agreed to putting her ruling on hold until May 12th. This would give landlords time to file their documents opposing a longer delay.

So Where Are We Now?

Here are some things to consider:

  • This ruling does not affect state judges who rule on eviction orders BUT it does create confusion because there have also been two other federal courts that have upheld the moratorium.
  • There are currently several conflicting court rulings at the district court level because there are judges that have ruled in favor of the moratorium and several that have ruled against it.
  • The confusion and competing judgements and opinions of law will likely cause continued hardship for both renters and landlords.
  • Renters’ rights groups feel that this decision to overturn the moratorium could leave tenants in a vulnerable position to be evicted.
  • Landlords rights group feel that there is little help ahead for them even though the Biden administration has begun to disburse tens of billions of dollars for rental relief for unpaid rent. Many landlords and renters have complained about the slow distribution of these funds.
  • Landlords feel that the moratorium was unsound and was one-sided in favor of tenants. The moratorium caused some to put their investments and their credit at great risk, forcing them to bear the brunt of the COVID rental crisis.
  • The Public Health Service Act of 1944 granted the federal government the power to deal with quarantines and health emergencies, but since the moratorium was about housing and not necessarily health, some feel the moratorium overstepped that act.
  • The big question now is not about who wins, it is not about landlords versus renters, it is now about whether the government had the legal right and authority to impose a nationwide eviction moratorium.
  • There are now cases being brought by REALTOR groups that are claiming the moratorium shifted the burden of rent being paid from the tenant to the landlord which then put unprecedented mandatory stress on landlords. (See the recent case brought by the Alabama Association of REALTORS- November 2020)
  • The National Association of REALTORS has argued that there is no reason for a nationwide blanket moratorium because rental assistance is now secured through the government, and an improving economy has put many renters back to work.
  • The National Apartment Association has argued that the CDC overstepped their authority to protect the public from a health crisis and used that crisis to take away the rights of landlords and property owners.

You can see from this list that there are many opposing opinions and arguments. One thing is certain, with this recent judgement there is sure to be further delays for both renters and landlords for reaching a resolution one way or the other.

The problem is that, for the moment, the enforcement of the federal order has been left for state level court judges. Those judges then must look at both federal and state regulations. They also must consider the individual merits of each case. This is not a slam dunk decision one way or the other.

So for anyone that got excited or upset about Wednesday's federal ruling, just remember that each state will use that ruling as a guide but not necessarily follow suit.

  

By Denise Lones CSP, M.I.R.M., CDEI - The founding partner of The Lones Group, Denise Lones, brings nearly three decades of experience in the real estate industry. With agent/broker coaching, expertise in branding, lead generation, strategic marketing, business analysis, new home project planning, product development, Denise is nationally recognized as the source for all things real estate. With a passion for improvement, Denise has helped thousands of real estate agents, brokers, and managers build their business to unprecedented levels of success, while helping them maintain balance and quality of life.

The Lones Group, Inc.

Comments (14)

Gwen Banta
Sotheby's International Realty - Los Angeles, CA

Thank you for the recap, Denise. This is an extremely informative post about a very confusing topic!

May 07, 2021 03:40 PM
Denise Lones

You are welcome Gwen!

May 11, 2021 04:44 PM
Kathy Streib
Cypress, TX
Retired Home Stager/Redesign

Hi Denise- good explanation!  The moratorium sounds good for tenants but there is always the other side of the coin. All rights need to be represented and protected. 

May 07, 2021 06:45 PM
Denise Lones

It is good for tennants, but government largely overlooked whether landlords also need protection - the 24 million mom-and-pop landlords who are individual investors, the roughly 70% of landlords who own less than $400k in properties - who are still on the hook for property taxes, who may be relying on that income to pay their own bills, who are still responsible for repairs and property maintenance. Among the public and even among agents who have a better view of this situation there is a lot of opinion from both sides of "the coin."

Good to see you at our ActiveRain Finding Sellers seminar earlier today. I got your email. Thanks for the compliments! - Denise

May 11, 2021 04:58 PM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning Denise - like other laws we must look at jurisdictions, federal, state, and local.

May 08, 2021 05:54 AM
Denise Lones

Thank you Grant. For agents who are in one of the 30+ states that did not have a state level moratorium, this potentially simplifies their local situation (of course there may be more local government intervention still in place too). For the other states which have moratoriums still in place, all of which are being challenged, those states may or may not follow along. Either way, agents should keep aware of developments in their jurisdictions. - Denise

May 11, 2021 05:05 PM
Kathy Streib
Cypress, TX
Retired Home Stager/Redesign

May 08, 2021 06:35 PM
Denise Lones

Thank you Kathy!

May 11, 2021 05:06 PM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Thanks for all the information on what is a confusing issue. Time will tell where this all will lead.

May 09, 2021 08:38 AM
Denise Lones

Stay tuned. As I mentioned above, this isn't over yet.

May 11, 2021 05:07 PM
Carla Freund
Keller Williams Preferred Realty - Raleigh, NC
Carolina Life RealEstate & Relocation 919-602-8489

Laws made to help others are sometimes abused by dishonest people. Hopefully we'll get through this.

May 09, 2021 08:46 AM
Denise Lones

We've certainly seen our fill of that during the past year. However, I don't want to reduce or minimize the number of people who need and are helped by these same initiatives - or how that "rising tide" of support helps our economy broadly "float more business and family boats." Thanks Carla! - Denise

May 11, 2021 05:11 PM
Wanda Kubat-Nerdin - Wanda Can!
Red Rock Real Estate Brokered by Real - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Laws need to be fair for all, not just those who benefit. Thanks for the explanation Denise!

May 10, 2021 03:25 PM
Denise Lones

You're welcome Wanda. Nice to meet you! - Denise

May 11, 2021 05:11 PM
Paddy Deighan MBA JD PhD
federalfinanciallawgroup.com - Vail, CO
Paddy Deighan J.D. Ph.D

This is one of the hardest decision we face as a nation. Our hearts are with tenants who need help... but we must recognize that landlords are frequently individuals who are being harmed to

May 10, 2021 07:16 PM
Richard V. Foster, Esq.
Nevada Perfect Homes - Henderson, NV
Broker (58356) - ABR/M, CREN, CRS, GRI, RRG, SFR

 

Speaking as both an attorney and a real estate broker, the ruling made by the federal court to overturn the moratorium is sound; and it is about time.

As an attorney, I had a Constitutional problem that the CDC ruling was a gross over reach of Executive power. There is a constitutional protection called the Contract Clause; basically stated, and there are a lot of limitations, no branch of government, especially the Executive or Legislative, can interfere with contracts that are already established. The landlord / tenant relationship is one formed under, wait for it, CONTRACT LAW; and the CDC was interfering with valid contracts; thus a violation of the Constitution.

With that said, federal law, including Executive actions, which have the power of law, and the Federal Court can, repeat CAN, if based on federal jurisdiction, override state law; so if either the judge that stayed the ruling, or a higher court allow the moratorium to remain, then it remains the law of the land, and state judges CANNOT evict if a tenant meets the guidelines.

One word of advice, remember to leave interpretation of legal actions and court rulings to attorneys, 1) we carry malpractice insurance for when we screw up and 2) we do not violate the Code of Ethics or 3) break state laws making an interpretation. Just saying, be careful not to cross the line between opinion and practice of law in our discussions, especially with our clients.

 

May 10, 2021 10:54 PM
Denise Lones

Richard - Thank you for your detailed comment and bringing to the conversation here perspective on the contract law part of this situation. As well as the reminder - agents don't practice law. So, if you are an agent reading this and a prospect or client asks you as a professional to interpret this ruling or your local eviction moratorium law, your response should always be to refer them to seek advice from an attorney. - Denise

May 11, 2021 05:26 PM
Kimo Jarrett
WikiWiki Realty - Huntington Beach, CA
Pro Lifestyle Solutions

I'm still confused, so, I'll plead no contest and send all consumer inquiries to their respective politicians for accurate information about this issue. 

May 10, 2021 11:32 PM
Denise Lones

Sound policy. Still, keep this on your radar if this is affecting your area. - Denise

May 11, 2021 05:27 PM
Ed Silva
Mapleridge Realty, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

Too many tenants used the pandemic as an excuse to not pay rent knowing that they had government supporting them. All the burden was placed on the landlords who suffered greatly to their businesses and their credit.

May 11, 2021 03:34 AM
Thessy Onyenedum
Atesa Properties, Inc - San Diego, CA

Great information, Denise. Yes, tenants are protected by the moratorium. Who is protecting the Landlords? Landlords have suffered and incurred huge losses not knowing where to go for help. Laws need to be fair to all parties.

 

 

May 11, 2021 04:14 AM
Denise Lones

States vary, but the federal moratorium indeed offered no relief for landlords' ability to recoup unpaid rent. See Richard Foster's comment above and my own responses to Carla Freund and Kathy Streib above for more thoughts on this. Thanks for the comment! - Denise

May 11, 2021 05:38 PM
Lyn Sims
Schaumburg, IL
Real Estate Agent Retired

This is a very messy situation & should only be discussed with your attorney I believe now that this has come about. I know in IL, many landlords are having problems because it keeps getting extended again & again.

May 11, 2021 10:57 AM
Denise Lones

Strongly agree with you Lyn. Thank you - Denise

May 11, 2021 05:29 PM
Greg Mona
West USA Realty - Scottsdale, AZ
Professional Real Estate Representation for YOU!

Thank you for the wonderful summary, Denise. Just reading it hurts my head! :-) I do hope for everybody's sake this issue gets resolved so there is clarity moving forward. From what I have witnessed, the landlords have taken the brunt of this much more so than the tenants. We'll see how this all shakes loose.

May 11, 2021 04:45 PM