Boston's New Eviction Moratorium Throws Confusion Into Apartment Market's Busiest Week

A new eviction moratorium in Boston has thrown the multifamily market into disorder during the busy Sept. 1 move-in cycle.

Boston acting Mayor Kim Janey temporarily halted evictions with a new moratorium announced Tuesday evening, one week after the federal eviction moratorium expired, giving Boston renters an indefinite window of protection. 

“While I've invested $50M in rental relief, that is the proactive stance,” Janey said Wednesday at a press conference in Allston. “We certainly hope we can help landlords and tenants resolve any issues before it gets to the point of an eviction. But with the courts not upholding the federal moratorium on evictions, it was really important to act on the local level.”

The moratorium has presented new challenges for landlords who don’t have any avenue for financial aid and some who are waiting to flip tenants into new spaces during the city’s busiest move-in period. Just 2% of multifamily inventory is vacant as of Thursday, a recovery from last September’s sky-high 10% figure, according to real estate data firm Boston Pads. Average rents have also stabilized from a pandemic dip and now sit among the highest in the nation. 

“It’s affected everybody,” Boston Pads CEO Demetrios Salpoglou said Thursday. “Not just renters, but it’s affected future renters, it’s affected landlords in a very visceral and very real way.”

The city has distributed less than $20M of a designated $50M relief fund to 3,500 households, despite it being months since the program received federal funds, but nonetheless that is a pace ahead of state and national averages. Boston also plans to distribute $5M in an Emergency Foreclosure Prevention Fund to aid with mortgage, insurance and condo fee payments for delinquent property owners.

Salpoglou said Boston Pads, which relies on landlords to update residency data, has heard of a few instances of tenants refusing to move out at the expiration of their lease despite another group of people already signed to move in this month.

“They’ve done everything right in the book,” Salpoglou said of the tenants in limbo. “They’ve given first-month rents, the requisite documentation, a binding document, and they're ready to move in. They’re innocent people.”

Declan Duffy, a Boston University sophomore from Albany, New York, was moving into a room in a six-bedroom house — for which he said he is paying $960 per month — in Allston across the street from Janey's press conference. He said he couldn't get in contact with his landlord, and it was clear the previous tenant had done some damage to the property.

“We can’t move into a house with open windows, broken doors, actively lived-in rooms,” Duffy said. "It’s very stressful."

Landlords with non-paying tenants in their portfolio are increasingly under pressure with months and sometimes more than a year of unpaid rent at properties, said Allison Drescher, a Boston apartment landlord and president of the Small Property Owners Association.

Landlords with properties larger than 20 units are barred from applying to the Residential Assistance for Families in Transition program, complicating situations in which tenants refuse to apply for a plethora of reasons, Drescher said. Statewide, 57% of RAFT applications have been rejected because of under-qualification or incomplete paperwork, WBUR reported. The $5M in foreclosure assistance is nowhere near the amount needed to aid landlords, Drescher said. 

“We are also seeing a real uptick in landlords that are selling their units,” she said. “This is disproportionately hitting poor neighborhoods in Boston, people who’ve held real estate for a long period of time.”

Landlords as of Sept. 1 are also covering broker’s fees in 42% of leases signed in order to get renters in apartments faster, according to Boston Pads’ data gathered from more than 16,000 property owners and more than 183,000 units in Boston. 

Tenants in workforce, or middle-income targeted housing, continued to pay their rent at a very high rate, Drescher said. The exodus of young professionals to the suburbs and students away from universities slammed the market last September but are returning amid in-person university policies, she added.

Janey said the city anticipates 50,000 new residents moving into Boston. Alongside the 42% of landlords paying fees, a smaller percentage are offering partial rent concessions. Before the coronavirus pandemic, just 5% of landlords offered to pay brokers’ fees, according to Boston Pads.

Landlords are mulling lawsuits over the new eviction ban, the Boston Globe reports, while Drescher said SPOA is reviewing its options to fight it. Massachusetts’ own eviction ban expired last October in the wake of a landlord lawsuit, in which a judge questioned the ban’s legality.

“Property ownership is part of the American dream for many families who come here,” Drescher said. “We have grave concern when municipalities take it upon themselves to make and impose laws on taxpaying citizens who provide an essential service. Where is the backstop for people who are out of time?”