Multifamily Owners Struggle as New Eviction Laws Shift Power to Renters

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A D.C. lawmaker is pushing for urgent reform to the District's Emergency Rental Assistance Program as rent delinquencies soar, driven by tenants using the program to delay evictions, while similar eviction laws nationwide are creating challenges for multifamily landlords. Plus, Lendlease is undergoing a major strategic shift, scaling back global operations in response to shareholder pressure and financial difficulties, while refocusing on its Australian core and sustainable development initiatives.

Now, let’s dig in!

Multifamily Owners Struggle as New Eviction Laws Shift Power to Renters

A Washington, D.C., lawmaker is calling for urgent legislative action to tackle a growing crisis that could force District affordable housing providers to shut down. D.C. Council Chairman Phil Mendelson is seeking co-sponsors for legislation to reform the District’s Emergency Rental Assistance Program. Real estate industry leaders say tenants have used the program to delay eviction proceedings while not paying rent. 

Multifamily owners in the area say legislative reform is critical to addressing the rent delinquencies faced by virtually all affordable housing operators. A report by D.C.’s Apartment and Office Building Association examined five large housing providers that own 13,788 units in the city and discovered their combined rent delinquencies totaled $12.7 million.

The delinquencies have soared due to lengthy delays in eviction proceedings, with resolutions taking between twice and three times as long as before the pandemic. This is partially caused by tenants filing applications for emergency rental assistance funds.

The D.C. Council made a pandemic-era change to the rental assistance program that stated a tenant couldn’t be evicted while their application was pending. This removed a judge’s discretion to weigh in on cases, even for tenants who had racked up far more debt than the program could cover.

Multifamily owners face challenging conditions due to similar eviction laws nationwide. After years of advocacy, New York recently passed ‘Good Cause’ eviction rules to stop landlords from evicting tenants without proper justification or hitting them with excessive rent hikes.

New York’s eviction law guarantees lease renewals for eligible tenants who pay rent on time and follow lease terms. It also limits rent increases to ten percent or the inflation rate plus five percent, whichever is lower.

Earlier this year, Colorado passed a new law requiring state landlords to cite a specific reason for evicting or not offering lease renewal to a tenant. Colorado became the sixth state to enact such a policy. Opponents of the Colorado law say it will make it harder for landlords to operate in the state and disagree with the premise that a lease non-renewal is the same as an eviction.

The pandemic-era eviction moratoriums caused many headaches for multifamily landlords. While this new wave of eviction-related laws aren’t quite the same, they may still make operating apartments more challenging. 

The new rules cropping up across the U.S. are further proof that the national conversation around housing has dramatically shifted toward renters.

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