Welcome to Rental Regulations Monthly, Obligo’s monthly digest of recent regulatory news impacting the rental market. Whether you’re a property owner, manager, or a renter, we’re here to highlight some key changes in the ever-shifting regulatory landscape of rental housing.
In November and December, states continued channeling millions to help struggling tenants and landlords. New York City passed a bill limiting the fees landlords can charge to lease-breakers. Read on to find out how these new changes might impact you.
New York City Restricts Early Lease-Break Recovery Charge
On November 23, the New York City Council passed a bill that puts a limit on the amount landlords can recover from tenants who vacate the property before the lease is up. When such violations take place, this bill restricts the fees recoverable by the landlord to a “fair market cost” – meaning the cost of cleaning, damage repair, and getting the unit in good enough condition for relisting. In addition, the landlord must provide an itemized list to the renter showing how the cost was calculated, which will provide more clarity in court if the landlord decides to sue for rent or additional costs associated with finding a new tenant.
Once in effect, the bill will apply to all New York City apartments. This is the latest addition to laws protecting New York renters – in 2019, state legislation outlawed landlords from charging last month’s rent on top of the security deposit at move-in.
For Renters: Sometimes life happens and you need to move. It’s important to keep an open line of communication with your landlord in such cases so they have more time to find your replacement and mitigate the potential damages for you both.
For Owners & Managers: Early lease-breaks add significant pressure to managing rental properties. Certainly never an ideal scenario, but finding a new tenant can sometimes be more efficient than pursuing legal avenues. To attract new tenants quickly, consider offering deposit-free living with Obligo’s flexible deposit alternative.
Illinois, Maryland and Oregon Beef Up Rental Assistance Programs
Early this month, Illinois announced nearly $300 million in emergency assistance to renters and landlords affected by the pandemic. Tenants who can’t pay rent due to COVID-related income loss can apply for the assistance, which covers 18 months of rental payments up to $25,000. Illinois will prioritize households earning less than 50% of the area’s median income and those with members who have been unemployed for at least 90 days. The City of Chicago will provide similar assistance with a new round of funding, which is expected to help at least 4,000 households.
Nearly 28,000 Maryland rental households affected by COVID will also get much-needed help, as the Maryland Department of Housing and Community Development announced $178.1 million in a new round of their Emergency Rental Assistance Program. The state has been steadily meeting and exceeding the federal spending goals for the program, and it will receive another $352 million through a second phase of the program in 2022.
On December 13, Oregon lawmakers passed a $215 million package during a one-day special legislative session to help those struggling with COVID. The package includes $100 million for emergency assistance to renters and landlords, and funds to help related agencies distribute emergency money more efficiently. They also voted for a bill extending the 60-day eviction protection period. Now, instead of two months, Oregon tenants who applied for aid will be protected from eviction until their application has been processed by the state.
For Renters: Check your city or state government’s website to see if there are existing programs to help with rent and security deposits, and be mindful of application deadlines.
For Owners & Managers: These government rental assistance programs, while beneficial to renters and landlords, may add more operational overhead for property owners and managers, including more payment sources to track. Obligo offers a holistic suite of deposit solutions that can simplify your leasing and accounting workflow. Schedule a demo to learn more.
As the only credit-backed deposit alternative, Obligo rids both landlords and renters from the burden of security deposits, making the move-in and move-out process as simple as checking in and out of a hotel. Learn how Obligo can help you streamline your operations, boost your bottom line, power a better renter experience and comply with ever-changing changing regulations!
*Disclaimer: The contents of this publication are for informational purposes only. This publication does not render legal or other professional advice or opinions on specific facts or matters, and should not replace consultation with an attorney.