California CRE News In Your Inbox.
Sign up for Connect emails to stay informed with CRE stories that are 150 words or less.
New California Bill Would Allow Tenants to Live Rent Free for Years
A new bill introduced in the California Legislature last week would force landlords to defer rents for 15 months after a state or local state of emergency is lifted, which can translate to years of unpaid rent, if a tenant is unable, or unwilling, to pay rent due to COVID-19. California AB 1436 would also prevent landlords from receiving funding to pay taxes, mortgages, utilities, or staff.
The California Apartment Association (CAA) wrote that the proposed bill would be especially problematic. CAA’s Debra Carlton says, “We know that in many cases local governments don’t lift their emergency orders for years. That means an owner may have to wait years to collect rent that went unpaid during the pandemic. AB 1436 will make our housing crisis worse. It will put hundreds of rental owners into default, leading to mass foreclosures on rental housing.”
CAA articulated the many problems with AB 1436 in an opposition letter to the bill’s author, Assemblyman David Chiu, D-San Francisco. Carlton says, “The bottom line is that tenants are not only protected from eviction, they are protected from any demand by the owner to pay rent that is owed. This equates to free rent.”
An alternative supported by the CAA is Senate Bill 1410. That bill proposes a state-funded rent voucher program to help pay the deferred rent, and provide stability to those renters who are recovering financially so long as they remain current on their contractual rental agreements.
For comments, questions or concerns, please contact Dennis Kaiser
- ◦Lease
