Keeping positive tenant-landlord relationships

Keeping positive tenant-landlord relationships
by Brad Cartier, posted in Newsletter

We are all doing our best given the ongoing situation. In my real estate business (small class B apartments), we proactively reached out to tenants with tons of information, offered a small initial rent discount, and discussed payment plans with some tenants who have income loss. We also contacted all lenders to discuss deferral/forbearance where appropriate, we spoke with municipalities regarding tax payments, as well as utility companies. We’ve also halted property tours—thank goodness for virtual options—and hastened our installation of smart locks to allow for remote access.

Christopher Brito of CBS News reports on other landlords who are offering some sort of rent relief amidst the ongoing pandemic. Even if you wanted to—which wouldn’t be advisable at the moment—you can’t evict, so the best strategy is one of cooperation and understanding.

Victoria Barker of the Residential Landlords Association (RLA) out of the UK reports on landlords going the extra mile during the pandemic:

Source: RLA

Kyle Stucker of Fosters.com reports on stories of landlords allowing tenants to pay reduced rent or defer payments, among other assistance.

Romana King of Zolo offers a number of resources for landlords seeking guidance on how to handle tenants during this crisis. This includes a well-written templated letter landlords could tailor to their needs to send to tenants.

Extended isolation is also difficult on our mental health, Landlord Zone out of the UK provides guidance to landlords on how to support the mental health of their tenants during the COVID-19 crisis.

Overwhelmed lenders

No doubt lenders are overwhelmed. In fact, despite a drop in the 10-year treasury—which tracks closely with mortgage rates—we’ve seen a short-term increase in mortgage rates due to the volume of requests over the past few weeks.

To deal with the increased demand for mortgage renewals and forbearance, Chris Arnold of NPR reports that some lenders are even offering up to 12-months of mortgage payment deferrals. “Fannie and Freddie are directing lenders not to report people to the credit bureaus for late or missed payments if they are in one of these forbearance plans.”

James Royal of Bankrate reports on the current cash-out-refinance boom that is also keeping lenders busy. “Persistently low mortgage rates are leading homeowners to take cash out of their homes at the highest levels since the financial crisis.”

Diana Olick of CNBC notes that refinancing fell 10% last week from the previous week, however was still 402% higher than the same time in 2019.

Clare Trapasso of Realtor.com reports on how the refinance boom could actually be bad for home buyers, as everything gets delayed and lenders get bogged down in more lending business that they can handle.

Taking a quick look at mortgage data for February 2020, Black Knight highlights that foreclosure starts fell 25% from January, their lowest level on record since Black Knight began reporting in 2000. Further, “the national foreclosure rate also ticked lower in February, falling to 0.45%; the lowest it’s been since 2005, and within one basis point of an all-time low.”

Black Knight on delinquincy rates for mortgages in the US

Source: Black Knight