EVERETT — Kris and Kristan Baier worry that in a month or two they might have to choose between paying the rent and paying for groceries.
But with four children, ages 15 years to 18 months, it’s no choice at all.
“The children come first, the food comes first,” said Kristan Baier, 39.
Kristan is furloughed until the dentist’s office in Kirkland where she works as a dental assistant re-opens. Her husband, Kris, 45, an advisor at Washington State University Everett, is working from home.
Here and elsewhere, the COVID-19 pandemic is forcing families to make hard choices, including paying for basic needs. For people used to paying their bills on time, it’s a shock. Uncertainty is the new norm.
Like most families, housing is the Baiers’ largest expenditure. The monthly rent for their five-bedroom home in south Everett is $2,500. The stimulus check they received and Kristan’s unemployment benefits have shored up their checking account, but that only goes so far.
“We’re a family of six,” said Kris. “We have to be a two-income family.”
In April, one in four renters either didn’t pay the rent or made only a partial payment, according to a survey by Apartment List, an online apartment listing service. The percentage of homeowners who were delinquent on their mortgage was about the same — 25%, Apartment List said.
In Snohomish, Skagit, Whatcom, Island and San Juan counties, call volumes for the local 211 help line have skyrocketed in the past few weeks, said Brian Smith, chief operating officer at Volunteers of America Western Washington, based in Everett.
More than two-thirds of those calls are from households seeking rent and mortgage assistance, Smith said.
Stimulus checks? “They’re a band-aid — they only go so far,” Smith said.
With Washington’s unemployment rate surging into double-digit territory — one estimate puts the U.S. jobless rate as high as 20% — even more families could find themselves behind on the rent. (In the midst of the Great Depression, the jobless rate reached 25% in 1933.)
In March, Gov. Jay Inslee imposed a temporary moratorium on evictions, providing some relief for families affected economically by the COVID-19 pandemic. The order imposes a temporary moratorium on evictions for inability to pay rent.
Last week, Inslee extended the moratorium through June 4 and broadened it to include a ban on residential rate increases and commercial tenants affected by the COVID-19 crisis. It also prohibited late fees and non-payment charges.
Alleged violators could find themselves in hot water.
On Monday, state Attorney General Bob Ferguson filed the first state lawsuit against a large property manager, JRK Residential Group, for violating the governor’s emergency evictions order. The Nevada-based company, which operates at least four apartment complexes in Pierce, Snohomish and Kitsap counties, allegedly issued “pay or vacate” notices to 14 residents at a Tacoma apartment building it operates, the lawsuit states.
“JRK Residential is a large, sophisticated corporation that knew about the Governor’s Emergency Evictions Proclamation – and ignored it anyway,” Ferguson said in a news release.
The state’s temporary eviction moratorium doesn’t eliminate rent payments. The rent is deferred, not forgiven. Tenants are expected to make arrangements with the landlord or property manager and repay what they owe.
Everett resident Dave Williams doesn’t know how he’ll cover the rent on his studio apartment come May 1.
Williams, who earned minimum wage working at the Soundview Tavern in Everett, is collecting state jobless benefits after being laid off.
But the weekly checks won’t cover the monthly rent, $850, and the $1,200 stimulus check he received was garnished to pay child support for his 7-year-old son.
“Why didn’t they take just half?” Williams lamented. “That was my rent.”
He also wishes that the landlord would forgo rent payments for a month or two — until everyone is back to work.
“They should have paused everything, including rent,” Williams said.
In the Everett area, the median rent on a one-bedroom apartment (half pay more and half pay less) is $1,389 a month. For a two-bedroom, the median is $1,730, according to Apartment List.
But landlords and property managers who follow the rules say they’re also in a bind.
Groups that advocate rent forgiveness don’t understand what’s at stake, said Tom Hoban, chairman and co-founder of the Coast Group of Companies. The Everett company manages more than 20,000 apartment units and 5 million square feet of commercial, retail, industrial and self-storage properties in seven states, including Washington.
Property management is like any other business: When the income stream stops, the bills don’t get paid, Hoban said.
In Portland and other U.S. cities, some city leaders are asking landlords to waive rent and mortgage payments for tenants and businesses financially decimated by COVID-19.
Multifamily Northwest, which represents residential property managers in Oregon and southern Washington, said such an action would force housing providers to cut expenditures to “as close to zero as possible.” As a result, thousands of workers that provide leasing, resident services and maintenance services would lose their jobs. In addition, property holders would be unable to pay property tax bills and utility bills for water, sewer, power and internet.
“Given the sheer size of our industry, that would send a cascading economic shock wave through local governments, school districts, power and gas utilities,” Multifamily Northwest said.
Said Hoban: “We view our relationship with the tenants as symbiotic. We need each other.”
The first step, said Hoban, is to “have a conversation with your landlord. Most are more than willing to work with tenants right now — that’s the best thing to do.”
“This is not our first experience with an economic challenge: 9/11 had elements of this — it came quickly and immediately impacted employment … the Great Recession,” Hoban said.
Hoban’s company, Coast Group, is helping tenants apply for unemployment benefits and locate state and community programs that can help with household expenses. It collected rent from about 90% of tenants in April and had conversations or arranged payment plans with the remainder, Hoban said.
Still, “we’ve had to pare our staff,” Hoban said.
“I’m optimistic about May, actually,” Hoban said. “People see the curve bending, by then we should have some announcements from the governor around who can go back to work and when, and a great deal of the federal relief will have made it’s way out to employers and individuals.”
Another group of renters facing a huge challenge are area students. To that end, Edmonds College plans to provide emergency assistance to students experiencing financial hardship because of the COVID-19 crisis. The one-time, limited assistance is aimed at helping students with rent, food, bills, tuition, course materials, child care and health care. The college received $1.4 million in federal CARES Act funds to address the issue, said Amit Singh, president of Edmonds College.
“We are doing everything we can to keep them in school and moving forward with their educational goals,” Singh said.
Kris and Kristan Baier are sympathetic to challenges faced by both tenants and landlords.
The couple own a rental house in Olympia and depend on the monthly rental receipts it generates to pay the mortgage on the property.
“We wonder if we’re going to get a payment this month from our tenants,” Kris said. “Our renter did make ends meet for now. But whether that’s going to change next month — I don’t know.”
Said Kristan, “We’re all just holding tight.”
Janice Podsada; email@example.com; 425-339-3097; Twitter: JanicePods