California renters financially impacted by the coronavirus pandemic will be protected from eviction until at least next February, while small landlords will be offered some foreclosure protections, under a measure approved by lawmakers and signed by Gov. Gavin Newsom last week.
“California is stepping up to protect those most at-risk because of COVID-related nonpayment, but it’s just a bridge to a more permanent solution once the federal government recognizes its role in stabilizing the housing market,” Gov. Gavin Newsom said in a statement.
The emergency measure, which Newsom and other backers have framed as a stopgap to buy time until the federal government steps in with more direct financial assistance, is the product of contentious negotiations between tenant groups, landlord interests and bankers over who will be left bearing the financial brunt of missed rent payments precipitated by the pandemic. Nearly one million Californian renter households have had a member suffer a job loss since the pandemic struck according to a recent UC Berkeley analysis, leading to worries of a possible “tidal wave” of evictions.
But while tenants, landlord and banking groups all urged lawmakers to approve the bill, the compromise’s specifics have left some parties severely disappointed.
Here’s how tenants and landlords made out in the deal.
What’s in it for tenants: Renters can’t be evicted for payments they missed from March, when the pandemic first struck, through Aug. 31. From September through Jan. 31, if renters come up with 25 percent of the rent they owe, they will also be protected from eviction. Renters can pay that 25 percent at any time before Jan. 31.
Starting Feb. 1, eviction rules go back to normal. Miss your Feb. 1 rent? You can be evicted, even if you got laid off because of COVID-19. Unable to come up with that 25 percent of missed rent between September and January? You can also be evicted.
How can renters prove they’ve been financially impacted by COVID-19? For renters below 130 percent of area median income, they have to fill out legal paperwork under penalty of perjury that says they’ve suffered a decline in earnings or increased expenditures because of the virus.
What’s not: Tenant groups are most upset that evictions unrelated to financial hardship from coronavirus will be allowed to resume in the next few days. They worry landlords will use any lease violation — people living in the apartment not on a lease, or creating a nuisance for neighbors — as a pretext to get rid of tenants who have fallen behind on their rent.
Rent forgiveness or cancellation is also missing in the bill, and tenants don’t have much time to pay back what they owe.
What’s in it for landlords: Landlord groups pushed back hard against prohibiting evictions unrelated to virus-induced financial hardship. They cite cases in which, under the current eviction moratorium, landlords could not remove renters who they claimed were damaging property or causing a nuisance to neighbors.
Small landlords who own between one to four units will receive some additional foreclosure protections. The proposal extends the 2013 “California Homeowner Bill of Rights,” passed in the wake of the late 2000’s foreclosure crisis, to small, non-corporate landlords who own up to 4 units. Those “rights” include specific guidelines mortgage servicers must obey in notifying and communicating with borrowers, as well as a prohibition against “dual track” foreclosures where lenders are allowed to pursue foreclosures while simultaneously negotiating loan modifications.
CalMatters is a nonpartisan, nonprofit news site dedicated to California policy.