Advice for Chicago Renters with Spring 2020 Lease Expirations and COVID-19 Concerns

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In a normal year the Chicago rental industry would be gearing up for the busiest moving day of the year, May 1. There would also be some serious prep for April 1 happening but the real spike usually occurs in May. This has been the case for centuries, reaching back to a time when May 1 was the only day when leases expired throughout the entirety of Chicago.

Towards the end of last week's article I touched briefly on the effect that COVID-19 might have on the May 1 peak of the season but today I want to explore that in more detail, because we're looking at something with far reaching implications for a huge number of industries throughout the city.

Seasonal Employment

Before we get into instructions for folks who were planning to move over the next six weeks I want to spare a thought for the people who work in the moving industry. This includes agents, moving companies and cleaning services. Mostly I'm thinking about the agents because I was one for a long time and have some idea of what they're facing.

A lot of the apartment locator services practice seasonal hiring, bringing on a full crew of agents in February and dismissing all but the top performers in October when the moving season comes to a close. These agents work entirely on commission. They absolutely need to land a lot of leases for May 1 in order to carry them through the rest of the year. With COVID-19 largely stomping on the moving season, preventing showings and dampening interest in moving, these agents are going to have to push very hard throughout the rest of the summer to make up for what they've lost this spring.

All of this is compounded by the fact that agents are emerging from what is traditionally the slowest time of the year, the off-market season that spans October through February. Even Realtors who handle sales with the occasional side rental will be coming out of a period of low income and hoping that the annual spring resurgence will bring in enough in commissions to handle their income tax payments. There's no withholding in real estate.

The same goes for all of the industries that support the housing industry. Not just rentals but also sales are going to be hampered by lockdowns. Mortgage brokers, real estate attorneys, moving companies, housekeeping services, admininstrative support staff for these companies, all of these depend on you guys moving, and all of them structure their annual budgets around a springtime peak. Nobody knows for sure how the market will recover after quarantines are ended. Will people push their moves to the summer or fall? If so will there be enough empty inventory to handle the shift? Will they wait until next year? It's entirely possible that the market could take a full year to get back on track after all of this.

If your planned spring 2020 move gets delayed, please try and push it only a few months into the summer if you can. However, when you do finally enter the market please be cautious. Not every agent will respond to the end of quarantine with grace and dignity. Some will be desperate and resort to shadier tactics than they might not normally use if they'd been able to reap their usual May 1 income windfalls. If at all possible, stick with agents that you've worked with before or work with agents who are directly employed by landlords. The springtime overhire of new agents at third party brokerages, and the training for those agents, will be of mixed quality at best this year since many of them expect agents to get on-the-job training through their first few transactions and those transactions may be slow to develop.

Delay Your Move

If your lease expires on March 31 or April 30 you absolutely need to be contacting your current landlord and your new landlord immediately about rescheduling the turnover date to later in the year. One can hope based on how the virus moved through other countries that we will be done with this COVID-19 business by the end of April but that will not necessarily mean that the moving industry can immediately spring back into full action.

Agreeing to a May 1 move now means showings of your occupied apartment would begin before quarantine ends. You would have to be attending showings yourself, entering and leaving apartments that might or might not currently house infected or high-risk residents. If a phone call or an email or two can completely extract you from the spring housing market, there is no reason why you should even consider any other first step.

Do what you can to get a lease extension of at least a couple of months. My guess is that most landlords will be amenable to lease extensions given the current atmosphere. They probably don't have the staff to spare to turn over your vacant apartment right now anyhow. Make your request in writing and follow up with a phone call if you receive no response.

Be Ready For Summer Weirdness

Many landlords sculpt their lease expirations so that they have the correct number of vacant apartments to meet seasonal demand. This means that they normally have a lot of leases expiring in May 1, fewer in the summer months, and then another large batch in the fall for the September/October back-to-school spike. If the entire May 1 market spreads itself unevenly through the rest of the year there is no real guarantee that supply will match demand quite so neatly this time around. There will be some months this year where there's a glut of extra apartments. There may be other months (as I expect to be the case in June) when there's nowhere near enough apartments to handle the redistributed load.

Deciding how long to extend your lease is going to be something of a crapshoot. I can't really say how many extra months you should ask for, save to say that you should not go past August 31 unless you're able to hold out until next spring. No matter when you hit the market again, be ready for either a feast or a famine and be as flexible as you can.

Finding a Truck

As you consider whether or not to commit to a May 1 move in spite of quarantines, you have to think about whether or not you'll be able to find a moving crew and a truck. Moving companies are not essential services. However, the workers will probably make themselves available in spite of the risks because they need the cash. There may be price gouging for the few moving crews willing to take on the hazards. There may be a scarcity of trucks or a huge abundance of them. It will probably be easier to find trucks than it will be to find moving crews but either way, it's going to be a very strange spring for moving. Be prepared and plan ahead. Call around to check availability and pricing before you commit to an apartment search.

Summer Sublets and Student Housing

We will be coming out of quarantine right around the time when college dormitories close for the summer. Normally May 1 and June 1 are busy months for subleases, broken leases, and a general shift in the college student population from dorms to apartments. Normally most of the employed adult population has already moved by the time college dorms close for the summer, meaning that the two separate demographics are rarely in competition with each other for the same apartments. This will not be the case this year.

College students who have not already lined up summer housing need to get on that early this year, since the June market may well be completely absorbed by redistributed May 1 movers. Given the choice between employed adults and college students with cosigners, any landlord is probably going to pick the employed adults. Students need to anticipate a fight for housing this summer and to understand the difference between discrimination and sane business practices. They also need to be prepared to couch surf this summer instead of obtaining a legitimate sublease as they would in normal years.

In a worst case scenario, students who might normally stick around their college or university for summer jobs may want to instead look at heading back home to their parents if such a thing is possible and finding work in their hometowns.

Can You Refuse Showings?

Note: since the publication of this article, the state of Illinois has deemed it illegal to show occupied apartments while stay-in-place orders remain in effect.

Technically you cannot refuse a showing of your apartment provided that the landlord gives adequate notice. Your lease may actually build in fines for refusing a showing. The CRLTO states that if you refuse access to a landlord for showings then landlord may obtain an injunction to force the issue, terminate your lease, or recover damages through the court system. As a business owner I cannot in good faith tell you to deny access for apartment showings.

That being said, if you are at high risk for complications due to novel coronavirus infection or have been ordered to self-quarantine due to COVID-19 exposure, I highly recommend that you take photos and a video of your apartment and provide it to the landlord in hopes that can be offered as a sort of "digital showing" in lieu of allowing strangers into your home during the coming weeks. Before taking photos or video make sure to prepare your apartment as you would for any in-person showing by hiding personal items and valuables such as photos, expensive appliances and your own reflection in mirrors and windows.

My guess is that any respectable landlord or leasing agent would honor a request to avoid exposure of you or their clients by showing a high risk occupied apartment. Many agencies have already established a COVID-19 policy of only showing vacant units. But in the event that your landlord is clearly not taking the honorable route despite all warnings to the contrary, offering a digital alternative may be enough to keep you out of the court system when the courts reopen in late April.

Renters who would normally be in the spring market need to put some serious thought and effort into getting out of it. The long-term repercussions of this year may well be felt for years to come if it finally breaks the tradition of a huge May 1 peak in the moving season. Because of the annual nature of leases, whatever we establish in the coming months will echo down through the coming years, and as far as I'm concerned that may well be a welcome change. May 1 has always been a time for lunacy and exhaustion in the moving industry.

If you know people working in the housing market who are suffering, try and help them out this spring. Many of them are not as tech-savvy as you might think, and many agencies charge extra for training. If you know how to use technology such as video editing software, mobile apps or other apps for online communication please offer to teach them so that they can continue to do some amount of business through this peculiar time without endangering others.

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Published by

Kay Cleaves