Only the Landlord Loses…

To Whom it May Concern;

No one asked but I wanted to throw my 2 cents into the ring about the very lazy and elementary blanket “no evictions” policy in Nevada.


First things first..I represent real mom and pops, not corporations with huge reserves and shareholders to raise additional money. I personally manage 320 houses or condos. My brokerage oversees more than 1400 homes and condos. These are real people who have rental homes for a myriad of reasons; income supplement, sole income, part of their retirement strategy, plan to return, still not worth what they originally paid, and others. Most of my owners have been amazing with their flexibility regarding rent needs for their tenants. I have provided extensive updates to them, pushed and promoted empathy, negotiated reduced rents as gifts (not deferred) and continue to promote the need for flexibility in helping us all weather the storm.


Unfortunately, once it’s been declared safe to walk outside to assess the storm damage, it is the mom and pop landlord that will be damaged – far beyond that of any tenant.


April and May (although May being slightly worse) I had a 79% full payment in rent – it took all 30 days to collect it but it was better than I had prepared our owners. 19% short pay and for April – almost all those short pays were completely forgiven (not deferred) by my compassionate owners – especially since UI was ridiculously slow to activate. 2% were completely non-pay. May, short pay numbers increased slightly and the non-pay rose a smidge as well. Tomorrow, June 2, I should have my last April rent collected. I think both the owners and the tenants can live in this world a little longer under these terms if both parties work in good faith. This letter is not about respectful parties honoring to their best of their ability to help each out. After all, we are all in this together – supposedly.


This letter is to advocate on behalf of the landlords being victimized by the no eviction order and the tenants who know there is ZERO leverage for a landlord. Here are some examples in my portfolio now;


*Tenant negotiated a reduced rent in April – 25% off. Owner, whose rent income pays his mortgage and cash flows a tad, agrees. Tenant never paid. Never communicated. Then in May, no pay, no communication until mid May. Proceeds to renegotiate a reduction in rent for April to a 30% discount of which we agree and still does not pay. Then today calls and offers to pay rent for April only is we agree to discount only (not defer) May and June to the same rate for April. This is not right. Clearly there is an ability to pay something but the owner has no leverage. Only the landlord loses.


*Tenant lease is up end of March. Owner notifies tenant that they will extend to end of April due to the pandemic. End of April comes around and the tenant does not move out. The landlord needs the house vacant so they can sell it to assist in their retirement relocation. Here it is June 2 and the tenant is still in the house – and the owner has no leverage. Sell it with a tenant in place? It’s an option that’ll cost the landlord thousands; tenant in place that cannot be removed, condition of the house is not well known – both huge risks that a buyer will discount and the landlord will eat. Only the landlord loses.


*Or same scenario as previous and the landlord must sell because they lost their income. Their listing must be priced below market to make it a reasonable risk to a buyer. The property stays on the market longer because the getting the tenant out is completely off the table. Or even better, will not allow a home inspection or appraiser in the house and the buyer gives up and moves on – a scenario repeating itself 2 or 3 times before the house is sold 15 to 20% below market and the owner is late on his payments for his personal home. Only the landlord loses.


*Tenant lease is up at the end of April. Tenant does not move out. Owner has a family friend due to move in for a position to take in Las Vegas and is now stuck with a holdover tenant and no leverage. Owner ended up paying $800 to the tenant to move out by end of May – how is that right. Only the landlord loses.


*Tenant decides to quit watering the landscape – does not tell anyone, we find out on a drive by inspection. Decades of growth are now in peril. Tenant doesn’t feel like they should care for this as it costs extra money. On top of that, there are 2 if not more people living in the house than are on the lease and a dog on premises not on the lease. A trailer is parked on the street in front of the house and noticed from the city of Las Vegas were being ignored. Tenant is paying rent, but has breached the lease in many different ways – landscape, dog damage, and multiple unauthorized people living in the house. Only the landlord loses.


*Tenant does not pay rent in April. After repeatedly attempting to communicate and understand the situation, we get an offer of rent to cover 30% of the commitment on the lease. Owner is told they have to take what we can collect and defer the remaining. May, $600 more. June $600 more. $3600 in deferment will never be collected. In addition, 3 other people are living in the home and they have a pitbull puppy – both lease breaches. The owner was adamant about no pets when marketing the house – going weeks longer than needed to secure this tenant. Neighbors complain of barking dog, teens having sex in the driveway, and a noise nuisance to the owner over the last few weeks. The landlord has no leverage to be a good neighbor, fix the lease breaches, or correct the one thing she was completely adamant about – no pets. Only the landlord loses.


*Tenant living in a very high end community in the hills of Henderson. Violation after violation for speeding, noise, commercial vehicles, parking on the street overnight all leading to HOA hearing and fines. All are lease breaches, to which the landlord has no leverage. Only the landlord loses.


*Tenant moves out, at the key exchange, it turns out the tenant was subletting the property to people not authorized to be on property per the lease. We cannot remove the sublessor per the police who showed up due to our expectation of a vacant home being turned over. Had this been a situation where a lease was still in place or a tenant on a month to month – the landlord would have ZERO leverage to remove the tenant and the sublessor. One step further, the tenant moves out but the unauthorized sublessor refuses to vacate – can’t remove them either – and they can’t even come close to paying the rent – its why they’re renting a room. Only the landlord loses.


*Last one. Tenant is in place and receives a pension from a state government. Pays consistently albeit late from time to time – no pays nothing. Has the income, just chooses to not pay his rent. How’s that shared sacrifice?


So due to a thoughtless blanket eviction policy tenants have been elevated above those who own the homes and condos they rent. Landlords can only sit and watch their homes and leases be violated. While 80% of these leases will end up being fine, 1 in 5 homes are putting the landlord in some sort of risk and the tenant none. Shared sacrifice, not!


These landlords will have to invest money they never collected to repair air conditioners and water heaters through traditional maintenance and repiar. On top of that they face paying for damages by lease breaches, pay HOA fines, pay court fees, and try to collect back rents. Additionally, true market rents may not be obtained because to pay back the missed rent it becomes unaffordable. So, the tenant moves out, the landlord has a debt of deferred rent of a couple of thousand dollars that he must send to collections – a less than 20% chance of collecting anything and if he does, it’s at best 50 cents on the dollar. Only the landlord loses.


It’s time for intelligent thought. Landlords will continue to work with tenants who are respectful and working to honor the spirit of their leases. In the cases where a landlord needs leverage to even the enforcement of the non-financial parts of a lease, it’s time for landlords to be considered equals in these relationships. If sacrifice is to be truly shared, I respectfully request lease breaches and situations where tenants flat out refuse to work with owners be brought in front of a judge immediately. Until this happens, only the landlord continues to lose. Without some sort of equal footing, the landlords will sell and inventory of homes will diminish…then the tenant will lose…as rents will rise.


Sincerely,


Tim Kuptz.

2 thoughts on “Only the Landlord Loses…

  1. Great letter explaining how the landlord loses. I hear people saying rent should be forgiven but no one is talking about the mortgage the owner has to pay. Certainly not equitable in my mind.

  2. Thank you very much for all the work you and your staff have been doing for us (including advocating for us landlords). We really appreciate it.

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