Blog: COVID-19 Crisis Has Immediate Impacts for Detroit Property Owners, Tenants

As metro Detroit residents continue to grapple with the COVID-19 health crisis, it’s clear the outbreak is affecting every corner of our lives, and every industry we work in.
Connaé Pisani
Connaé Pisani // Courtesy photo

As metro Detroit residents continue to grapple with the COVID-19 health crisis, it’s clear the outbreak is affecting every corner of our lives, and every industry we work in.

Real estate is no exception and, in these unprecedented times, unprecedented measures are being taken by Detroit and Wayne County.

On March 16, Wayne County treasurer Eric Sabree announced that due to the economic uncertainty caused by COVID-19, Wayne County won’t foreclose on any homes in 2020 due to tax delinquency. Prior to the announcement, about 3,200 occupied homes were expected to be placed in the Wayne County Tax Foreclosure Auction, and this reprieve gives those homeowners time to catch up on their payments.

On the same day, Detroit’s 36th District Court announced it would place an immediate moratorium on evictions in the city. Rulings had already been suspended for most civil matters through April 6, and a coalition of community groups are calling for the eviction moratorium to last until 30 days after Michigan’s state of emergency is declared over. In his announcement, Chief Judge William C. McConico said it would be “mean-spirited to remove people from their homes until this threat has passed.”

As a business owner in the fields of real estate and property management, I am already seeing major and immediate impacts of this crisis on both tenants and landlords in metro Detroit.

Landlords are now dealing with the reality that tenants with a delinquent balance may fall further behind during this moratorium and preparing for the financial impact that will have.

These rulings also bring up a host of questions:

  • What is the status of past legal orders due to the eviction moratorium?
  • Will landlords be able to execute evictions with writs that expired during the moratorium?
  • Do landlords have to re-initiate the legal process from the beginning to eradicate tenant delinquencies? Will their legal costs increase as a result?
  • How will the courts regulate the path forward? Who is eligible for assistance and under what terms?

This unique situation will require a balancing act. Property owners will have to do their best to minimize financial impacts from the rulings on foreclosures and evictions, but do so in a strategic way that remains sensitive to the harsh realities that their tenants are facing.

We are fighting an outbreak that affects all of humanity, and that humanity cannot be forgotten as we navigate this new world. There must be understanding on both sides, and landlords should be happy to receive rent whenever possible, while working with their tenants as we navigate these difficult waters.

As we enter uncharted territory, standards may continue to shift until we have a clearer path forward and a closer sense of normalcy.

Expect more delinquency
With so many jobs in Michigan being affected by COVID-19 related orders such as the restaurants and bars dine-in shutdown, even tenants with great payment history may find themselves unemployed and unable to pay rent.

Depending on how the crisis evolves, the questions then become serious for both renters and landlords.

Will tenants be able to catch up? And will owners be able to survive without rental income?

Some landlords depend on rental income as a means for their own survival, risky as it may be.

What’s clear is that the impact of this health crisis is global and it’s affecting tenants and investors worldwide. In the long-term, rent prices in Detroit will likely drop, because investors would rather keep their tenants and receive a little less than have vacancies and no cash flow.

Investors from across the globe, many of whom own property in Detroit, are rightfully anxious about the potential impact the COVID-19 crisis may have and how long it will last.

But at the same time, interest from investors should remain strong despite this uncertainty.

Real estate prices in Detroit remain low compared to other major U.S. cities. Interest rates have dropped, home values have risen, the rental market is strong, inventory is low, and the demand for real estate remains high.

Also, with the stock market crashing during the COVID-19 crisis, people are looking for new and more reliable ways to reinvest their money to avoid further drops and market fluctuation.

Long-term, we may be headed toward prime territory for investors to jump at unique investment opportunities at low prices and interest rates, while the rental market readjusts to the changing economic climate as a result of the COVID-19 crisis. The continued support from local and national officials offers a great amount of security that landlords and tenants will be able to successfully navigate these difficult waters.

Connaé Pisani is founder and CEO of National Real Estate Management Group, a real estate investment, construction, and property management firm that manages properties throughout the city of Detroit and beyond. She can be reached at