People are going to be short on rent. It's time to step up.

The Covid 19 virus is already having drastic effects on the economy and its fallout is yet to be determined but will likely cause a substantial recession. How governments are dealing with the issue and whether people are reacting in a rational way is irrelevant. As landlords, renters, company owners, or employees, we are all in it, accept it.

Different states and countries are implementing different relief programs. Some are halting evictions, allowing mortgages to be differed, preventing foreclosures and compensating employees in different ways. Again, whether you like the economic plan of your country, province or state is irrelevant. It’s happening. 95% of this situation is out of your control, but the choices you make with that remaining 5% could make a huge difference to your bottom line, and other peoples lives.

A huge number of people are going to have substantially reduced income in the coming months. A lot of those people will be living in our rental units. It’s very likely that some of your tenants will not be able to come up with their full rent, or maybe any rent at all.

I understand that investing in real estate is a business and businesses need to make money. The concept of a business offering its services or product for free is not an option in some peoples minds. We all have bills. Utilities, property tax, repairs, insurance and of course mortgage payments. Most, if not all of those bills will still need to be paid and we are dependent on the tenants rent to pay them. So if a tenant can’t pay rent, get someone in the suite that can right? It’s not that simple.

First of all, a lot of landlords will be evicting or at least trying to. That means lots of rental units on the market and lots of landlords trying to attract the few tenants that can afford to pay rent. Do you want to be vacant in that scenario? Evicting will likely see your units sit vacant for a while, not to mention turnover costs.

Second, this isn’t your tenants fault. Yes, maybe they should have a few months rent saved for a rainy day, but most people these days don’t. If a tenant buys a brand new car and then can’t afford rent, that was a very poor decision and being evicted is just a repercussion of their bad choice, but this isn’t something your tenant intended. No one saw this coming. Some of us are prepared, but most are not.

Third and most important. We are all going to be impacted. Everyone. I expect this to be worse than the 2008 collapse. I’m not fear mongering or being a pessimist, just realistic. How is evicting people going to help anything? This is an incredible opportunity to come together as rental housing providers and human beings. I have a single mom that’s been living in one of my rental properties for over two years and has collectively paid me over $40,000 in rental income. She’s a waitress and will likely be laid off if she hasn’t been already. She has always tried her best to pay rent on time and is grateful for living in the house and having a landlord that “cares”. I’ll be honoured and privileged to help her through these tough times. If she can only provide 50% of her rent for the next couple of months, or even if she can’t come up with any of it, I’m looking forward to the opportunity to be the person that provides relief for her in this nightmare. The stress of a layoff, the virus, the looming recession, uncertainty of how this will all play out and the fact that she is a single mom that might be homeless soon is a lot. What if I get to tell her she won’t be homeless? Let me rephrase that. I’m lucky enough to be the person that gets to tell her she doesn’t need to worry about living on the streets through an economic crisis.

Not all tenants are single moms trying their best. Some are lazy, resentful and ungrateful and take advantage of any opportunity they can. Maybe it’s not worth cutting them any slack, but a lot of our tenants are decent people that just got knocked down and need a hand up.

You can evict and be vacant in the coming months, or offer discounted rents. Either way, we are going to take a hit, just like everyone else. Some people won’t be as effected as others and some people will get bailouts while others don’t. It’s not fair. Life’s not fair. Get over it. Real estate has been very good to me, as it has for most of you. It’s time to pay it back, step up and offer what relief we can as rental housing providers. Landlords tend to have a bad public image. Let’s change that and take this opportunity to save some people from a terrible situation.

Collecting rent feels good. Telling a tenant that you’ve got their back when they are stressed to the limit feels better.

Step up and be an awesome person.