Landlords in LA have been on the hook for their tenants back rent following a barrage of COVID policies delaying payment for years. But just as the light can be seen at the end of the tunnel, darkness appears again.

February 1, 2024, is the last deadline for tenants to pay back rent owed between Oct 1, 2021 to Jan 31, 2023. But days before the deadline the LA City council passed a new motion delaying the deadline another 120 days for those approved for rent relief funds but have yet to receive them. Now landlords may not get paid until June 1, 2024. That’s 33 months without a rent payment, and that has small business landlords struggling to make ends meet and looking for options.

But what options do they have?

Mom and pop landlords with an average of three units were the majority of property managers in Los Angles just a few years ago, according to the Apartment Association of Greater LA (AAGLA), but the moratorium on evictions, a freeze on rent increases and non-payment of rent due to COVID policies have forced small landlords to face mounting debt, foreclosure and liquidation of retirement savings. Now, small landlords are the minority owners of rental property in LA, down to just 23 percent. For the three years of COVID from 2020 to 2023, LA has seen a rapid and massive sell-off of private rental properties to corporations. Corporations now account for 43 percent of all the city’s rentals, and it’s growing, by leaps and bounds. The rest of the rental pie in Los Angeles is owned by trusts.

It’s easy to see why corporations are gobbling up rentals in LA. Small landlords are struggling and need to pay the mortgage, put food on the table and send their children to college, so they sell to get out from under the debt, the hassle, and the legal ramifications of evictions. One small landlord I talked to is more than $30,000 in debt due to one tenant’s non-payment of rent over three years.

When awarded a judgement to evict, the LA County Sheriff’s Department takes months to force the tenant out, costing the landlord additional back rent and legal bills. In addition to the $30,000 in back rent owed the small landlord, he has spent another $20,000 plus in legal fees to navigate the web of complicated new rent-relief laws enforced by the LA city council during COVID.

The average eviction should take about three weeks, according to a landlord’s advocacy group, but since the rental relief programs have taken place, it seems the city and county want to slow roll the process. An attorney representing a small landlord with a judgement to evict a troubled tenant says it can now take up to eight months, and the renters know it. An eight month eviction, according to the AAGLA, can cost a landlord $50,000.

A call to the LA County Sheriff’s department handling evictions confirms the delay. They report short-staffing and say they have not recovered from the number of officers lost due to COVID, and the outflow of deputies during the defund the police movement. In addition, the person answering the phone at the LASD eviction department says, “We have lost a lot and they are leaving faster then we can hire them.” Both LASD and LAPD are not meeting recruitment numbers.

On-the-record, those with knowledge on the issue say eviction moratorium judgments are now roaring into the system and colliding with short staffing for the county tasked with helping landlords, both big and small, evict tenants. Corporations have more operating capital and can ride out the delays, but mom and pops are stuck with no money coming in, many are struggling with day-to-day expenses. The AAGLA reports the financial assistance to tenants is around $10 million, while the number for uncollected rent along with missed rent increase opportunities have cost landlords $1 billion.

Of course, the underlying issue here is homelessness. Every landlord and attorney representing small landlords I talked to say they believe the motivation for the delays against evictions are because the city doesn’t want to see another spike in homelessness. California has a homeless population of 170,000 people with 76,000 unhoused in Los Angeles alone. By the way, the state has spent $17.5 billion trying to combat homelessness in the four years from 2018 to 2022. Theoretically, California could have paid the rent for every homeless person during those four years.