The Chicago City Council will vote on Friday, April 24 during a virtual meeting of lawmakers whether or not to approve an apartment rent relief program that extends a 12-month grace period to renters who lost income due to the COVID-19 crisis. Whether the city has the power to enact such a rent relief program is unclear, as Illinois’ rent control law prohibits any municipality from enacting rent control for rental apartments.
Alderman Matt Martin (47th ward) and his colleagues introduced legislation that would provide up to one year for apartment renters to pay back rent that they’re unable to pay in the wake of the Coronavirus’ immediate economic impact. According to Martin, 1 in 12 Illinois workers have filed for unemployment as the Coronavirus has upended the economy. This loss of wages is squeezing the bottom line not only for cash-strapped renters struggling to make their monthly rent payments, it’s a burden that landlords have to carry as well.
Landlords of apartments are responsible for paying the mortgage on the properties, so the legislation also calls for a mortgage forbearance of at least 90 days. Federally backed mortgages under the umbrellas of Freddie Mac and Fannie Mae are already getting protections from late penalties and fees; the new ordinance would apply similar leniency to non-federal loans.
The City of Chicago set up an emergency housing relief fund for renters across the city in March 2020. The emergency fund awarded approximately $2 million in grants to renters who applied for a lottery drawing. More than 83,000 applicants entered the drawing but only 2,000 renters were able to get assistance. This new legislation will put in place some more long-term protections for renters as they get back on their feet financially.
In addition to the financial relief called for in the new ordinance, additional safety measures that protect renters’ health are introduced. The Coronavirus is highly contagious and this apartment rent relief ordinance also seeks to prevent anyone from entering a renter’s apartment without prior consent to help prevent the spread of the virus. This applies to both landlords and possible future tenants.
Illinois Governor J.B. Pritzker’s March stay-at-home order already halted a majority of daily operations for businesses, including some activities in the real estate and property management realm but not all of them. Essential business operations such as moving, conducting virtual tours and title closings conducted over video conference are not impacted by the stay-at-home order. But landlords and agents are prohibited from showing occupied apartments or homes to prospective renters and buyers under the order. The new legislation introduced by Ald. Martin would extend that measure of tenant safety for another 12 months.