One of the most challenging and unfortunate parts of managing residential rental property is dealing with tenants who are unable to pay their rent or who engage in questionable or criminal behavior within their residence.
Prolonged cases on either front often result in a decision to pursue eviction of the resident. At Berrada Properties, it is an action of last resort.
While landlords in Milwaukee have received a high level of public attention for eviction rates in recent years, often lost amid the discussion is that high eviction rates are not in the best interest of the landlord.
Evictions cost money, and not only in court costs. In many cases, evictions also result in unrecoverable rent payments and/or property damage to the apartment itself. It is truly in the landlord’s and the tenant’s best interest to avoid eviction.
With nearly 10,000 apartment units, Berrada Properties is one of the city’s largest residential property owners. We make every effort to help tenants understand their obligations before a lease is signed and encourage them to communicate with management if they run into challenges paying their rent.
We’re always willing to make the effort to help a renter meet their payments and stay in their home, but it’s up to the renter to communicate with us if they are having trouble meeting those obligations. We have more than 20 staff members that work in a local call center to provide 24/7 access to tenant services, including services to address rent payments.
Our average monthly eviction rate is just 2.5% and the vast majority of those evictions are the result of significant delinquent payments. We spend an average of 3-4 months in mediation attempting to resolve the matter with the tenant.
The Apartment Association of Southeastern Wisconsin, Inc. (AASEW) recently conducted a study of evictions filed in Milwaukee County. It outlines many of the realities of eviction cases that aren’t always reported.
The study reviewed all eviction cases filed for the month of December 2019 (1,101 of them) and found that 51% were dismissed, and in 21% of the cases, money judgment for damages was not sought. Only 2.9% of judgments against the tenant were paid. The study indicates that eviction judgments total approximately $12 million per year, while estimates place actual unpaid rent in Milwaukee at $60-$100 million annually.
Unpaid rent is a reality we see, but we go to great lengths to extend grace to tenants. In March alone, 162 residents within Berrada Properties were behind on rent with back payments ranging anywhere between $4,000 to $13,000 per renter.
The disparity in back payments can be attributed to varying monthly rent obligations in addition to ongoing efforts to work with residents on meeting their payment obligations.
Most of our tenants are good renters leading stable and productive lifestyles. While unpaid rent is a primary driver of eviction efforts, nefarious activity such as drug dealing, illegal gun activity, and general property damage incurred by renters can be contributing factors as well. It’s not uncommon for landlords to not only lose out on recovering unpaid rent costs, but to also must make significant investments to fix damaged property incurred by the renter.
Berrada Properties is committed to helping tenants stay in their homes. We’ve started requiring that tenants view a series of educational videos to help set expectations and build understanding of how tenants can work with property management if questions or other issues arise.
We’ve also created a payment center that allows tenants the opportunity to easily pay rent in person or through a drive-through service. We have a locally staffed call center to provide 24/7 access to tenants with questions, and this fall we’ll be opening a Tenant Learning Center that will serve as a hub for tenant-focused programming.
In a market already challenged by a shortage of affordable housing, eviction should be the last resort of any landlord against a tenant. Berrada Properties is committed to keeping it a last resort and doing everything it can to help tenants stay in their homes.
