Quantifying Landlord Losses: From Unpaid Rent to Deferred Maintenance and Foreclosure Risk

Beyond the Headline Number: The True Cost of Eviction Moratoriums

When discussing eviction moratoriums, the conversation often fixates on one number: unpaid rent. By January 2021, landlords nationwide faced an estimated $57 billion in accumulated unpaid rent obligations. That figure alone is staggering. But it represents only the tip of the iceberg.^1

The reality is far more complex and devastating. Eviction moratoria inflicted a cascade of compounding financial harms on landlords—particularly small, mom-and-pop property owners—that extended far beyond simple lost rental income. This article examines the full scope of economic harm, from lost interest and late fees to property damage, deferred maintenance, financing difficulties, and the very real risk of foreclosure.^3^5^1

Category 1: Direct Rent Losses—The Foundation of the Crisis

Unpaid Rent Accumulation:

The most obvious harm was lost rental income. Landlords nationwide experienced unprecedented non-payment rates during moratoria.^4^6^1

Pre-Moratorium Baseline:

Before COVID-19, most landlords experienced relatively predictable and manageable rent losses:^5

• The Addison (Seattle): Lost rental income averaged $54,787/year from 2016-2019^5
• Hennepin County (Minnesota): 88-96% of evictions were for nonpayment of rent, suggesting consistent enforcement of payment obligations^3
• Small landlords (1-5 units) in Minneapolis: Number receiving less than 90% of rent due was stable^3

During Moratoria:

These baseline losses exploded:^6^1^3

Property/Location	Pre-Moratorium Annual Loss	During Moratorium Loss	Increase
The Addison (Seattle)	~$55K/year (2016-2019)5	$463K (2020), $699K (2021)5	8x-13x increase
GHP Management (LA)	Not specified	$20+ million by Aug. 20216	N/A
Minnesota landlords receiving <50% rent	Baseline (2019)	Doubled in 20203	100% increase

Nationwide Totals:

• 10+ million delinquent renters by January 2021^2
• $57 billion in accumulated unpaid rent by January 2021^2
• $124.8 million in outstanding rent debt in Minnesota alone as of November 2024^3

Category 2: Lost Interest and Late Fees—Time Value of Money

Eviction moratoria didn’t just prevent collection of rent—they prohibited landlords from charging interest or late fees on unpaid rent.^4^3

Constitutional Significance:

The Ninth Circuit has recognized that the right to daily interest is deeply ingrained in our common law tradition and protected by the Takings Clause. By banning interest and late fees, moratoria deprived landlords of the constitutional right to the time value of money.^6

Quantified Losses:

GHP Management (Los Angeles landlords) alleged they suffered several million dollars in lost interest and late fees as a direct result of the moratorium.^6

For a landlord owed $50,000 in back rent over 18 months, assuming a modest 5% annual interest rate, the lost interest alone exceeds $3,750—per tenant.

Category 3: Ongoing Operating Expenses—Bleeding Money Monthly

While tenants stopped paying rent, landlords’ expenses continued unabated.^1^5

Fixed Costs Landlords Still Paid:^4^1

1. Mortgage Payments

Most rental properties carry mortgages. Landlords received no mortgage relief corresponding to the eviction moratoria.^5^3

2. Property Taxes

Property taxes continued accruing. Ironically, landlords paid taxes to the same governments that prohibited them from collecting rent.^4^3

As one amicus brief noted: “Landlords were still expected to pay property taxes to the County of Alameda.”^4

3. Insurance Premiums

Property insurance, liability insurance, and other coverage remained mandatory.^5^4

4. Utilities

Landlords often paid for water, sewer, trash collection, and sometimes heat.^6^4

As the GHP Management complaint noted: “Tenants may continue to occupy their respective premises at no charge, utilizing the water, power, trash, sewage, and other fees that the landlords must continue to pay without reimbursement.”^6

5. Maintenance and Repairs

Landlords remained legally obligated to maintain habitable premises or face tenant lawsuits for uninhabitability.^3

Example: The Addison (Seattle)

From 2016-2019, The Addison’s average annual operating costs (excluding lost rent) remained relatively stable. But from 2020-2022, these costs continued—while rental income plummeted:^5

• 2020: Total losses $983,654 (vs. ~$186K average 2016-2018)^5
• 2021: Total losses $1,128,727^5
• 2022: Total losses $1,750,794^5

Category 4: Property Damage and Deferred Maintenance

Moratoria didn’t just prevent eviction for nonpayment—they often prevented eviction for property damage, nuisance, and lease violations.^3^6

Prohibited Evictions:

Many moratoria prevented eviction except in extreme circumstances:^4^3

• Minnesota: Only if tenant “seriously endangered safety” or “significantly damaged property”^3
• Alameda County: Only for “imminent threat to health or safety”^4
• Los Angeles: Prohibited evictions for “nuisance” related to COVID-19^6

Real-World Consequences:

Stephen Lin’s Case (Alameda County):^4

Mr. Lin’s tenants:

• Housed three large German Shepherds and a Huskie (lease permitted two small dogs)^4
• Dogs barked constantly, resulting in neighbor complaints^4
• Dogs defecated and urinated all over patio and garage^4
• Tenants hosed down areas 3x daily, doubling the water bill^4
• Water caused moisture buildup, resulting in algae growth outside and black mold in garage^4
• Home became infested with cockroaches, resulting in public health notice^4
• HOA threatened fines; Mr. Lin attended numerous meetings apologizing to neighbors^4

Mr. Lin could not evict or address any of these problems due to the moratorium.^4

Other Documented Harms:^3

• Sexual or racial harassment of other residents
• Threatening other residents
• Smoking in nonsmoking buildings
• Leaving trash in hallways/stairwells
• Loud parties increasing COVID spread^3
• Loss of paying tenants who left due to conditions^3

MHA member testimony: “MHA members reported that they lost staff and paying tenants due to abusive tenants who could not be removed because of the eviction moratorium.”^3

Category 5: Financing and Refinancing Difficulties

Eviction moratoria made rental properties toxic assets for lenders.^6

GHP Management Allegations:

“Plaintiffs have also suffered related financial losses attributable to the refusal of lending institutions to finance and/or refinance loans on Plaintiffs’ apartment community properties, specifically on account of the Eviction Moratorium.”^6

Why Lenders Refused:

Would you lend money secured by a property:

• With tenants who aren’t paying rent?
• That the owner can’t evict for an indefinite period?
• Whose value has plummeted due to lack of income?^6

The answer is obvious. Landlords couldn’t refinance to obtain better rates, couldn’t access equity to cover losses, and faced loan covenant violations.^6

Category 6: Inability to Sell—Trapped Assets

Several plaintiffs in takings cases attempted to sell properties to stop the bleeding. They couldn’t.^4

Rakesh and Trupti Jain (Alameda County):

The Jains’ tenant:

• Never paid anything—security deposit and first month’s rent checks bounced^4
• Owed $58,000 in back rent by May 2022 (16 months unpaid)^4

The Jains wanted to sell. No buyers.^4

Why?

As the Supreme Court noted in Loretto: “Though the owner may retain the bare legal right to dispose of the occupied space by transfer or sale, the permanent occupation of that space by a stranger will ordinarily empty the right of any value, since the purchaser will also be unable to make any use of the property.“^4

Who wants to buy a rental property with a non-paying tenant you can’t evict?^4

Category 7: Disproportionate Impact on Small, Minority, and Low-Income Landlords

The economic harm from moratoria fell disproportionately on the most vulnerable landlords.^3

Small “Mom-and-Pop” Landlords Hit Hardest:^3

• Landlords with 1-5 units were most likely to have tenants deeply behind on rent during the pandemic^3
• Small landlords comprise 73.3% of landlords in Minneapolis^3
• Small landlords were least likely to participate in or be aware of emergency rental assistance programs^3

Many small landlords cannot afford to go months without rent:^3

“Many small landlords cannot afford to go months without rent. The financial stress from the pandemic pressured landlords, particularly small ones, to sell properties to stop the bleeding.”^3

Minority and Low-Income Landlords:^3

• Smaller rental properties have the highest share of owners who are racial minorities^3
• Smaller landlords are more likely to be retirees or have limited outside income^3

As the Minnesota Multi Housing Association emphasized:

“While some groups have rightly argued about the disproportionate impact of the pandemic on minority and low-income tenants, the same is true of minority and low-income landlords.“^3

Category 8: The Compounding Effect—Financial Death Spirals

The various categories of harm didn’t exist in isolation—they compounded each other in devastating feedback loops:^5^4

The Cascade:

1. Tenant stops paying rent → Lost income^5
2. Landlord can’t evict → Can’t replace with paying tenant^6
3. Operating costs continue → Landlord bleeds cash monthly^5^4
4. Can’t refinance → No access to capital^6
5. Property deteriorates → Deferred maintenance due to cash crunch^4
6. Property value drops → Can’t sell to stop losses^4
7. Missed mortgage payments → Foreclosure risk^3
8. Loss of property → Total financial ruin

Category 9: Foreclosure Risk—The Ultimate Consequence

The culmination of all these harms was foreclosure risk.^3

While precise foreclosure data is difficult to obtain (foreclosure processes take years), the ingredients were all present:^3

• Landlords with zero rental income for months/years
• Ongoing mortgage obligations
• No ability to refinance
• No ability to sell
• Mounting debt

As multiple amicus briefs warned, without compensation, many landlords faced loss of their properties entirely.^4

Quantifying the Total Harm: Case Studies

The Addison (Seattle):^5

Year	Total Losses	Lost Rental Income	Bad Debt
2016-2018 (avg)	$186,174	$43,162	$42,721
2020	$983,654	$463,122	$74,333
2021	$1,128,727	$699,817	$50,618
2022	$1,750,794	$1,270,757	$515,846

Total excess losses (2020-2022): Over $3.3 million compared to baseline.^5

GHP Management (Los Angeles):^6

• $20+ million in unpaid rent by August 2021
• Several million dollars in lost interest and late fees
• Several million dollars in property damage from unauthorized occupants/pets
• Unquantified financing losses, diminution in value

Projected total by moratorium end: Over $100 million.^6

The Illusory Nature of “Rental Assistance”

Governments pointed to emergency rental assistance as “compensation.” It was grossly inadequate.^7

Los Angeles ERASP:^7

• Maximum: $2,000 per household
• Average LA rent (2020): $2,524/month
• Result: Didn’t cover even one month of average rent

Minnesota RentHelpMN:^3

• No payments until May 2021—over 14 months into the moratorium
• By October 2022: Renters applied for $111 million MORE than was paid out
• As of November 2024: $124.8 million in outstanding rent debt in Minnesota alone

Oregon was the exception—providing 100% compensation to landlords—and consequently faced no successful takings claims.^7

Conclusion: A Complete Economic Catastrophe

Eviction moratoria inflicted a complete economic catastrophe on landlords, particularly small property owners. The harm extended far beyond unpaid rent to encompass:^1^6^3

• Lost interest and late fees
• Ongoing mortgage, tax, insurance, and utility payments
• Property damage and deferred maintenance
• Inability to refinance or sell
• Disproportionate impact on minority and low-income owners
• Compounding feedback loops
• Foreclosure risk

Oregon demonstrated the constitutional path: compensate landlords for property taken. Most jurisdictions chose instead to force landlords alone to bear public burdens—violating the Fifth Amendment’s promise that private property shall not be taken for public use without just compensation.

The full accounting of landlord losses will take years to complete. But the evidence is already overwhelming: eviction moratoria constituted one of the largest uncompensated takings of private property in American history.

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This article is for informational purposes only and does not constitute legal advice. Property owners with questions about takings claims should consult qualified legal counsel.