What The Eviction Moratorium Means For Real Estate Investors in Kansas City

The CDC determined that evictions would spread COVID19 through renters being put out of homes and living with friends and in shelters. This order applied to renters who could not pay due to COVID reasons, but did not apply to evictions for other reasons like their lease ran out or they violated their lease. The burden was put on the renter to provide a document to the court.

So what does it all mean here in Kansas City, it means that courts open back up and eviction proceedings have been happening. But if the renter could not pay due to covid, and the provided the documentation, that they could not be physically removed from the property. The idea was to have a moratorium and give renters time to get back on their feet, possibly get assistance through Catholic Charities, State Programs, or the United Way. All Assistance programs here in the Kansas City Metro can be accessed through the website at www.211KC.org or by dialing 211.

However, for many housing providers it has meant months and months of no rental income with no way to put the renter out. It has also meant that many housing providers have been afraid to rent out vacant units and instead have opted to let them sit vacant or sell them.

The ban on evictions is set to expire on December 31st. If we are lucky we will get a bill passed in Washington DC in the next few days that will extend this ban through January 31st of 2021 and at the same time inject some much-needed money into the system.

Can Evictions Still Proceed

While all evictions can still be processed in the Kansas City Metro, even in Kansas City Missouri where the yellow-shirted activists are chaining themselves to the courthouse doors, suing the presiding judge in Jackson County and now this past week the Mayor asking for a total halt to all evictions. They can still proceed. However, if the renter can’t pay due to COVID reasons and can prove it in court, they can’t be set out. Civil penalties for the housing provider are rather hefty sums, so we do recommend all housing providers proceed with the advice of counsel.

Light at the End of the Tunnel

When the order expires, not only will the unpaid rent still be owed by the tenant, their monthly rent payments will be due in full moving forward. Although, we all know that once a renter is behind 2 months, there is little hope of them ever getting caught up. Unless there is some sort of rental assistance program available.

In the proposed Emergency Corona Virus Relief Package that we read this morning is up to $900 Billion, we understand there are a few provisions that might help renters get caught up:

  • First, the CARES Act Funding that is out there now and set to be returned if not spent by December 31st, 2020 is going to be extended to 2021. Rather good news given that many of the assistance programs using CARES Act funds didn’t start until October, November, and event December.
  • The package includes a lot of general assistance in the way of stimulus checks and unemployment.
  • Plus there is $25 Billion to be set aside for rental and utility assistance that is supposed to see the majority of it going to the people and not the administration.
  • In that $25 Billion the housing provider can apply on behalf of the tenant and the funds directly to the housing provider and it can cover up to 18 months.

Working With your Renters

One avenue is to discuss a plan with your renters to begin making partial payments towards the monthly payment to the best of their ability over the next few months and then apply for aid. Keeping them in there a few more months and a little bit of effort might just earn you all of your back months you are due. Plus you can include 12 months going forward within those 18 months. So once the money is there and the plans in place you could apply for all rents you are owed since last March and while we’re not sure exactly how it works, it seems you could also apply for rent through August of 2021.

But how far will $25 Billion Go?

Filing Evictions

Keep in mind that in Kansas and Missouri cases are still being heard and even if you win a case, if your renter qualifies because of COVID , you can’t put them out. Unless you apply for aid and set aside the eviction you won’t get paid.

We really hope this relief bill gets passed, it just might save 1000s of renters from eviction and 1000s of housing providers from going out of business.

Stay Informed

We highly advise all renters and housing providers to continue to stay informed. Once great resource of information on this subject is Mid-America Association of Real Estate Investors. This is a trade association for real estate professionals here in the Kansas City Metro and their director is also an owner here at kcmoHomeBuyer.

If you have any questions on the matter, please feel free to contact us and we will do our best to put you in touch with the right party. Just reach out to our team by sending us a message or giving us a call today at (816) 408-3600 !

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Kim A Tucker

Kim Tucker along with her husband Don and son Scott make up the core kcmoHomeBuyer Team that has been buying homes across the Kansas City Metro since 2000.