Millions of renters have been badly hurt by the coronavirus pandemic, and while there are protections in place in the form of eviction bans to prevent them from ending up in the streets, their obligations to their landlords haven't gone away. One nonprofit, however, has started a program designed to help renters dig out of their hole, all the while serving the greater good of the community. And if it proves successful, it may be a scalable option during times of crisis.
Volunteering in exchange for rent
Contemporary Housing Alternatives of Florida, a nonprofit landlord of over 500 affordable housing units, has witnessed the impact the pandemic has had on its tenants. It estimates that roughly 20% are behind on rent because they've either lost their jobs or had their hours cut since the outbreak began in March. Not surprisingly, many of those impacted worked in the hard-hit hospitality industry. Restaurants and hotels in particular have taken a huge beating in the course of the past nine months, laying off employees left and right.
With that in mind, the nonprofit introduced a "Back on Track" program that forgives $100 of unpaid rent for every hour a tenant volunteers for a recognized charity. The logic was that Contemporary Housing Alternatives had resigned itself to writing off much of that money anyway, so it figured it might as well make the best of the situation by encouraging its tenants to give back to the community by volunteering their time. Over two dozen tenants have participated in the program already, doing trash cleanup and assisting at food banks.
This isn't the first bone Contemporary Housing Alternatives has thrown its tenants. Back in April, all tenants who managed to pay rent on time received a $25 grocery store gift card as a thank you. The nonprofit is also working with tenants on payment plans to help them through the ongoing crisis. All told, Contemporary Housing Alternatives is down $300,000 in rental revenue, but rather than bemoan that, it's instead trying to encourage charitable behavior at a time when the world really needs it.
Will other landlords follow suit?
The concept of forgiving rent and encouraging volunteer work in lieu of it is a great idea in theory. But whether it takes off is another story. While some landlords may be in a position to work with tenants and forgive rents on a massive scale, mom and pop landlords may be feeling the strain just as badly as their delinquent tenants.
Nearly 20 million of the country's 48 million rental units are owned by individuals, as opposed to companies with the resources to write off unpaid rent with relative ease. And also, not every property management company is a nonprofit like Contemporary Housing Alternatives.
Still, the idea of letting struggling tenants volunteer to cover their rent could take off on a small scale, especially during the pandemic. Financially sound landlords may take advantage of an opportunity to not only help their tenants but also give back to their respective communities. And who knows? Some landlords may even uphold such arrangements after the pandemic in situations that warrant it. If anything, it's a good way for landlords to build goodwill, which, in the world of residential properties, certainly never hurts.