It's not a secret that the San Francisco rental market is among the most expensive in the country. The average rent for a studio apartment in San Francisco is a whopping $2,095, reports Zumper, while the average one-bedroom is worth $2,795 a month. Throw in the economic upheaval caused by the coronavirus pandemic, and it's no wonder some local tenants are taking steps to get themselves some much-needed relief. In fact, a number of tenant groups are pushing back against high rental prices and what they perceive as a glaring lack of government aid by engaging in rent strikes, with one group already having withheld $150,000 in rent payments over the course of the past few months.
If San Francisco landlords are getting worried, well, they have every right to be. The question is: Will this spark a national trend, and will tenants start withhold rent left and right?
A risky prospect for tenants
Withholding rent might seem like a solid bargaining tool for tenants, but the reality is that it's a dangerous one. Landlords whose tenants withhold rent illegally have the right to begin the eviction process, and while there are certain protections in place right now for San Francisco tenants, there are currently none that apply after January 31, 2021.
As such, tenants may be able to get away with withholding rent for a period of time, at least in San Francisco, but come early 2021, they'll be forced to play catch-up. And that could prove problematic, because the aforementioned protections don't cancel overdue rent payments entirely; they simply create a scenario where tenants can't be evicted temporarily for falling behind.
Of course, San Francisco isn't the only place with tenant protections in place during the coronavirus crisis. In fact, there's a federal eviction moratorium in play through the end of 2020 designed to keep renters nationwide in their homes, at least for the remainder of this calendar year. But once that eviction ban expires, it's landlords who will, to some degree, have the upper hand.
Then again, maybe not. The reality is that the eviction process is a lengthy and costly one that landlords are generally better off avoiding. And going after tenants for months of unpaid rent could be a disappointing, financially devastating prospect for landlords.
As such, landlords are better off working with tenants during these difficult times rather than letting things reach the point where there's an all-out revolt. Specifically, now's the time for landlords to negotiate with tenants and grant them leeway. Landlords should be open to concessions like temporarily reduced rent or late payments, especially for tenants who can prove they've fallen victim to layoffs or income loss in the course of the pandemic.
In fact, the situation in San Francisco may be the culmination of tenant frustration over an unreasonably high housing market coupled with limited landlord support. And while there are other expensive housing markets in different corners of the country -- notably, New York City -- the reality is that by being proactive, landlords can avoid letting things escalate to the point where tenants are withholding rent to the tune of $150,000.
A little flexibility goes a long way
It's generally in landlords' best interest to work with tenants rather than remain inflexible. Right now, that's even more essential. Landlords who express a willingness to negotiate may find that they fare better in the course of the pandemic than those who don't, even if it does mean taking a hit on rental income temporarily.