Without Aid To Financial Institutions, Low Income Neighborhoods Would Be Hard Hit
August 12, 2020
The New Jersey Speaker’s Council is out with recommendations for recovering from the COVID-19 pandemic. Among the ideas put forth are real estate vouchers. Without them financial institutions like banks and credit unions may lower their housing investments in low-income communities.
The report says both commercial and residential landlords have been burdened by the shift in financial responsibility resulting from state policies that ease tenants’ rent payment obligations. Landlords cannot maintain and support properties without rent payments from tenants.
Recent Legislation and Executive Orders setting forth non-eviction policies – while important to protect the people of this State – have not been balanced by an equal investment in a voucher subsidy that helps residential apartment and commercial building owners to remain financially viable. The real estate industry is carrying a heavy financial burden as a result of residential and commercial tenants who cannot pay their monthly rent after voucher payments have been exhausted.
As such, the State must consider avenues to ease this burden, while maintaining protections for residential and commercial tenants. In fact, if non eviction policies continue to be expanded, without rental vouchers, minority communities could face disinvestment in housing stock. As such, it is important for New Jersey to acknowledge that the economic burden put on landlords will actually be carried by lower income communities, and therefore hurt the population we are attempting to protect.
The impact to properties, and financial institutions will cause a ripple effect that will impede the efforts of the economic recovery. Helping tenants is an important task in this recovery, but the legislature must also ensure that it provides support to the real estate community and industry so that they can continue to serve the most venerable population.
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