2020 has been an interesting year. Between shutdowns and COVID, mask mandates, and the occasional visits of murder-hornets (where did those go?), we’ve barely had time to deal with one disaster before the next one hits. The legislature has now taken it upon themselves to add a new element to the convoluted landscape that is 2020.
HB 4213, yet another obstacle to navigate in the minefield of the rental market. This house bill is an extended eviction moratorium, suspension of landlord reason for no cause notices, and more. As always, they didn’t do anything halfway; penalties for failing to follow the bill are steep, entitling the tenants to three months of rent plus actual damages.
For those of you that missed it, our very own Therese Waggoner made a detailed video breaking down the bill when it passed. It is posted below for your viewing convenience.
The practical effects of this bill and the mask mandate are a little hard to sort through. The rental market does not seem to be slowing, though it certainly will if Governor Brown enacts another statewide closure. Most of our rental properties are experiencing normal turnover periods. Rent prices are remaining steady.
A quick breakdown of HB 4213:
- Creates a repayment grace period of six months after the end of the eviction moratorium.
The tenants will have these six months to pay the back rent accrued. During that period, the landlord may not evict the tenant for failure to pay their back rent, but the tenant must keep current on the ongoing monthly rent or face eviction.
- Permits landlord to notify the tenant concerning the six-month grace period and the balance owed on their lease.
This notice will be sent once the grace period begins. It will inform the tenant that an eviction may not be filed before 10/1/2020 and that the tenant must alert the landlord within fourteen days if they wish to utilize the grace period to delay repayment of back rent. Should the tenant fail to provide proper notice, the landlord is entitled to recover damages. The damages are equal to 50% of one month’s rent after the grace period.
- Prohibits negative credit reporting for non-payment of rent during the moratorium.
- Prohibits late fees and other penalties for nonpayment during moratorium.
- Allows landlords to accept partial rent payment without waiving their rights.
Some good news in the bill:
- No-cause evictions are allowed when a property is sold to a buyer who intends to occupy it as their primary residence.
- Landlords who were unable to move-out a tenant at the end of the first year of occupancy because that occurred during the moratorium will have a slight break. They have a 30-day window after the moratorium ends to move them out.
A landlord that violates House bill 4213 may find themselves owing the tenant three months’ rent plus actual damages.
The rental market is holding steady. No landlord wants a vacancy at a time like this, so the bill is not likely to have much immediate effect insofar as the removal of no cause notices. If landlords feel the hurt, it will be later on in the year.
Work with your tenants, or if you are a client of Empire, keep in touch with your property manager. And as always, especially in the harder times, we wish you Happy Landlording.