How the Latest COVID Relief Affects Real Estate Investors

COVID in Rentals

How the Latest COVID Relief Affects Real Estate Investors

An extension of the March 2020 CARES Act was signed into law at the end of December 2020, providing nearly $2.3 trillion in government funding and federal relief. Rental assistance and unemployment benefits are included in this package, which can have significant impacts on real estate investors.

Here’s what you need to know when it comes to the extended COVID relief, and what to expect in facing 2021 head-on.

Tax Incentives for Investors

The bill provides a 5-year extension of the New Markets Tax Credit, which incentivizes investments in low-income communities. It also issues a Low-Income Housing Tax Credit, which is meant to incentivize the construction of affordable housing for low-income families.

Extended Eviction Moratorium

The eviction moratorium has since been extended through March 31st, 2021. The federal moratorium applies to properties that participate in federal assistance programs or receive federal financing. 

Please note that state and local eviction moratoriums have also been enacted and upheld. Check your state and local regulations for further specifics on evictions in your area. 

Rental Assistance and Stimulus

The updated bill also includes $25 billion in rental relief for past-due rent, utility payments or current rental dues. In order to qualify for rental relief, household income must maintain below 80% of the area’s median, and at least one tenant must have lost their job or qualified for unemployment. 

Additionally, stimulus payments of up to $600 per adult for individuals whose income was less than $99,000 were issued at the turn of the new year. An additional $1,400 stimulus per adult is anticipated within the first half of 2021, according to President Biden’s anticipated relief plans.

Let’s be honest, 2020 was not the best year to be in real estate – from job loss and local shutdowns to rent moratoriums, many of us have experienced some sort of negative financial or business impact as a result of the pandemic. By understanding the federal provisions in addition to researching state and local regulations, you can better anticipate what’s to come in the new year, and educate tenants on expectations as well.

Mitch Sellers
Assistant Property Manager at Integrity Realty & Management, Inc.
Mitch Sellers is a former Assistant Property Manager with Integrity Realty & Management where he conducted a significant amount of the field operations associated with managing a large portfolio of rental assets. Mitch graduated from Rowan College at Burlington County, in New Jersey, in 2019 with a degree in Business Administration.