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COVID-19

Are we paying rent?

Sabri Ben-Achour Apr 16, 2020
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An apartment building in Brooklyn, New York on March 25. Bryan R. Smith/AFP via Getty Images
COVID-19

Are we paying rent?

Sabri Ben-Achour Apr 16, 2020
An apartment building in Brooklyn, New York on March 25. Bryan R. Smith/AFP via Getty Images
HTML EMBED:
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Like 22 million other Americans, dance instructor and choreographer Anthony Davidson has suddenly found himself without a job. He didn’t pay April rent and he isn’t going to pay May’s.

“I need to save every penny I can, now, because I don’t know how long it will last or how long it will be until I have a paycheck again,” Davidson said.

He’s getting unemployment, but he can either use it to pay rent or pay for … everything else.

“My highest priority is medical insurance, because you never know what is going to happen,” he said.

At the beginning of April, it looked like 31% of apartment tenants had not paid rent on time. New data from the National Multifamily Housing Council show that some have since paid late or partially, but 16% haven’t paid any rent — still higher than usual. The numbers may be higher for commercial tenants and in some cities.

“Commercial tenants — a lot of them are not paying rent,” said Frank Ricci, director of government affairs for a landlord advocacy group the Rent Stabilization Association. Some landlords are working with tenants, Ricci added, and evictions have been paused in places like New York. But, he noted, landlords face expenses, too.

“I don’t think anyone wants to get to that decision point of making a choice between paying your property tax, versus paying a mortgage, versus paying a necessary repair. It’s an impossible choice,” Ricci said.

“Someone has got to foot the bill here and now the game is who’s best able to dance and avoid the problem and everyone’s trying to get themselves off the hook here,” Elliot Eisenberg, a real estate economist with economic consultancy Graphs and Laughs, told “Marketplace.”

Some economists warn that unpaid rents — and, in turn, unpaid mortgages — could further strain the financial system.

“In a normal recession, the problem is bad enough,” Eisenberg said. “But here, the speed at which the job losses have come has been so profound [that] these nonpayments become an immense issue because you’re losing large chunks of revenue.”

COVID-19 Economy FAQs

What are the details of President Joe Biden’s coronavirus relief plan?

The $1.9 trillion plan would aim to speed up the vaccine rollout and provide financial help to individuals, states and local governments and businesses. Called the “American Rescue Plan,” the legislative proposal would meet Biden’s goal of administering 100 million vaccines by the 100th day of his administration, while advancing his objective of reopening most schools by the spring. It would also include $1,400 checks for most Americans. Get the rest of the specifics here.

What kind of help can small businesses get right now?

A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.

What does the hiring situation in the U.S. look like as we enter the new year?

New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.

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