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Eviction ban stuns real estate industry

Governor Cuomo (Credit: Hans Pennink)

sweeping eviction ban that advanced in the New York State Legislature on Monday hurts struggling property owners. The bill halts evictions and foreclosures across the state for 60 days, and allows tenants who have lost jobs or income due to the pandemic to submit financial hardship declarations that would halt those proceedings until May 1, Politico noted.

  • Major flaw: As we pointed out yesterday, the financial hardship declaration that tenants could submit does not require proof of economic hardship, meaning a tenant who has the means to pay can use the law as a pretext for a rent holiday. Governor Cuomo said he intends to sign the bill into law.
  • Tenant groups prevail: Landlord groups made a grave error and should have pushed Democratic allies in the Assembly and State Senate to combine rental assistance legislation with the eviction ban. This failure helps perpetuate the false caricature of a landlord as someone who “enjoys evicting tenants.” A realistic, pro-tenant message was key from the outset, with the real estate lobby encouraging state spending to foot part of a struggling tenant’s rent. A blanket ban is simply unfair to landlords –– our industry’s message isn’t being articulated effectively! 
  • City needs real estate taxes: Real estate is the largest driver of tax revenue for the city. The sector generated 53% of taxes for New York in the prior fiscal year, while personal income taxes came in a distant second place at 21%.
  • Tenant perspective: The Housing Justice for All coalition said in a statement: “This bill is only a temporary solution to the urgent housing crisis we find ourselves in. In order to prevent massive economic disaster, our legislature must clear the back rent owed by New Yorkers and create a hardship fund for small landlords struggling to keep their buildings safe and afloat.”
  • Heard from the real estate lobby: Jay Martin of CHIP: “No renter facing financial hardship should be evicted during a pandemic, but the cost of providing free housing cannot be fully borne by property owners. If renters interpret this bill as a justification to not pay rent the damage to our economy and local budgets will be immense.”

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