It’s officially been a year since the COVID nightmare started, and for the first time since, we are pleased to provide you with an update containing only good news! The best part? We didn’t cherry pick the stories, it’s just been a great month. In the paragraphs that follow, you’ll find positive news about the stimulus bill, employment on both a national and state level, rent collection, COVID-19 case numbers, vaccinations, our local real estate market, the eviction moratorium and the most recent legislative session! So, if you are someone looking to feel better, read on!
Headlines
- February Jobs Report - The U.S. economy added 379,000 jobs in February, smashing analyst expectations, and the unemployment rate moved slightly lower to 6.2%. Additionally, January’s numbers were revised up by more than 110,000 jobs added. This is fantastic news and shows signs of the jobs recovery we’ve all been waiting for. While economists believe the total number of jobs lost to the pandemic is underreported and we still have a long way to go, these are very encouraging numbers.
- Jobless Claims - Good news on the jobs front as new jobless claims for the week ending March 6th came in at 712,000. The drop marks the third straight week of new claims below 800,000 and a four month low. Continuing claims also fell, ending February at 4.14 million which was down from a revised 4.337 million the prior week. Locally, new claims inched up slightly this week to 3,289 (they were previously 3,113 which marked a near 12% drop) while continuing claims fell for the fifth consecutive week.
- COVID-19 Update - There is good news for Utahns in the fight against COVID-19. New cases have been trending downwards, and as of Tuesday, the rolling 7 day average of new positive cases per day stood at just 518. These are new case numbers we haven’t seen since late August, and assuming we can avoid another spike, might mean the worst is behind us. Additionally, 857,750 Utahns have now received at least one vaccine dose and 310,327 have been fully vaccinated.
- Stimulus Bill Passed - Last Saturday, the U.S. Senate passed a $1.9 trillion COVID relief bill. The legislation, which saw a narrow 50-49 vote in the Senate, passed the House on Wednesday and was signed into law by President Joe Biden yesterday. The bill is strikingly similar to the one passed in the House in February and includes $1,400 stimulus checks (for individuals making less than $75,000/year and couples who earn less than $150,000), expanded unemployment benefits at $300/week through September 6th, 2021, an expansion of the child tax credit, $25 billion in federal rental assistance, money for state and local governments as well as for schools and vaccine distribution. Hopefully, when combined with the improving employment situation, this bill will bring relief to those most affected by the pandemic.
Legislative Update
We wanted to take this opportunity to update you on several bills we were tracking during the most recent legislative session. Most of this information has been compiled via updates from the hardworking people at the UAA, but we’ve included our thoughts as well.
HB 268 Fit Premises Act Amendments, Bennion, (D) Cottonwood Heights
UAA Synopsis: An effort to limit owner’s rights to enter their rental units failed on the floor of the house last week. After failing to contact us or seek compromise before filing the bill, the sponsor pushed ahead with a bill to always require 24 hours’ notice to enter except in emergencies, court order, or abandonment. Her proposal failed 50 No to 20 Yea votes. We support protecting tenants from inappropriate entry but there are many reasons owners need right to entry including suspicion of criminal activity, to show to government inspectors, suspicion of lease violation, to conduct maintenance and repairs as requested by renters, and more. Being required to give notice would allow renters to conceal criminal activity and lease violations and make our communities less safe.
Our take: This bill is a perfect example of legislation that sounds good in theory, but is highly problematic in practice. We completely agree that reasonable notice should be given when entering a property for routine inspections, however, requiring that a 24-hour notice be given to enter would only serve to protect renters who choose to engage in criminal activity or violate their lease.
HB 68 Renter Expenses Requirements, Judkins, (R), Provo
UAA Synopsis: This bill, after making modifications the rental housing industry could support, requires disclosure of all rental expenses prior to accepting rental applications. It allows renters to get their deposit and application fee back if when they go to sign the contract there are expenses not previously disclosed. After passing the house, this bill appeared to be in trouble in the Senate. The sponsor told us that had the association not testified in favor to a senate committee, it would have failed. It barely passed 4-3 and went to the full Senate where it passed on 3/5/2021.
Our take: Unlike HB 268, this bill is common sense legislation and we support it. We have always disclosed all of our fees in our advertising as well as on the first page of our rental application and believe wholeheartedly that those that don’t give our industry a bad name. As housing providers, we must educate our prospective tenants on what they can expect and not ambush them with hidden fees.
CDC Eviction Moratorium found Unconstitutional by a Texas District Court
UAA Synopsis: For months lawsuits challenging the federal Eviction Moratorium put in place by the Centers for Disease Control having been moving slowly through the process. Last week, a US District Judge in Texas ruled that the CDC’s eviction moratorium is unconstitutional. The government is sure to appeal. But this is a clear and first win for rental housing providers who have been forced to shoulder a disproportionate share of the burden from this pandemic. Experts estimate there is approximately $70 billion in unpaid back rent and while the federal government has provided $25 billion to state rental assistance programs for 2021, almost none of that has been distributed yet this year because of delays in setting up rules and programs. Housing Providers in Utah have been superheroes and valiantly worked with their customers to keep them housed despite the government being inefficient in distributing rental assistance. Despite Utah having $213 million in rental assistance to use this year, many owners have received no rent at all in 2021. Many renters are trying, but some are not and owners need the eviction option as a tool to deal with renters who are taking advantage of the crisis to avoid paying rent. The solution is to pay needy households rent, not make landlords provide housing without any income for months on end.
Our take: We couldn’t have said it better ourselves. The misconception that all landlords are wealthy enough to carry the load is simply incorrect. From our experience, most rental property owners are just regular people who rely on their rental income to pay mortgages or provide income and a seemingly endless ban on evictions is an unfair ask. This isn’t to say that tenants are to blame, as managing the crisis falls well outside of their control. The launch of a new and improved rental assistance program should relieve the pressure on both landlords and tenants alike.
State to Launch 2021 Rental Assistance Portal for Landlords March 15th
UAA Synopsis: Despite Congress allocating $213 million in rental assistance to Utah, housing providers will not be able to access it until March 15th. Despite the delay, the good news for housing providers is:
●Eligible households can receive up to 9 months in back rent and 3 months (at a time) forward rent and up to 12 months total rental assistance in 2021.
●Households that earn less than 80% of Annual Median Income for their county are eligible.
●The new portal is streamlined and easier to use than 2020’s LHAP program.
Our take: Finally! Beginning on 3/15, we will be updating ledgers and submitting claims for tenants with past due balances. Hopefully, those owners who are owed back rent will start seeing payments this month!
Utah Real Estate Market
The real estate market in Salt Lake and surrounding counties remains red hot. In fact, the median home price for single family properties in Salt Lake, Utah and Davis counties jumped an incredible 3.7% in the last 30 days to an all time high of $455,000. The number of completed transactions jumped as well while inventory tightened ever so slightly. It will be interesting to see if the demand for homes increases as we reach the spring selling season, or if climbing interest rates reduce the number of buyers. For now, we just enjoy the ride.
Median Sold Price
January: $438,725
February: $455,000
% Change: Up 3.7%
Sold Count
January: 1,170
February: 1,349
% Change: Up 15.2%
Average Number of Active Listings
January: 1,003
February: 987
% Change: Down 1.6%
Industry Updates
- SLC Rents Climb - In Salt Lake City, rents have grown more in the last month than they have in the past year. According to Apartment List, rents in SLC have grown 1.0% in February compared with 0.7% year over year. Year over year, rent growth in Salt Lake has trailed the state average of 3.1%, but remains well above the national average of -0.8%.
- Foreclosure Ban Extended - Struggling homeowners can breathe a sigh of relief as the federal ban on foreclosures has been extended until June. Also, for homeowners who requested forbearance from their lender prior to June 30th, 2020, the maximum period of forbearance has been extended by 6 months.
- New SLC Apartments boost home values - It might be time to embrace higher density in our single family communities. According to University of Utah researchers, homes in Salt Lake County within a half mile of newly constructed apartment buildings increased 10% in median value between 2010 and 2019 compared with 8.6% for homes farther away. Interestingly enough, this held true countywide with the exception of suburbs in the South East.
