With the unemployment rate still more than 10 percent and eviction protections lapsing across the country, housing experts say millions of Americans could lose their homes amid the pandemic in the coming months if Congress doesn’t act.
The housing situation for millions of Americans was already precarious before the pandemic, with many paying large percentages of their monthly incomes toward rent and without enough savings to cover a few hundred dollars in emergency expenses. Millions have lost their jobs during the pandemic, and a study released earlier this week found 5.4 million also lost health insurance, which is generally provided by employers. The enhanced unemployment checks of $600 per week from the federal government are set to expire at the end of July — although payments have been delayed in many states — as the patchwork system of eviction moratoriums begins to lift in some areas where they’re still in place.
As the number of positive tests, hospitalizations and deaths resulting from COVID-19 continues to rise in many areas of the country, millions of Americans, without jobs or health insurance, are in danger of being forced out of their homes. Moving in with family or friends would likely mean overcrowding, a risk for spreading the coronavirus. Other families may be living on the streets during triple-digit heat and hurricane season and then, should the crisis continue, freezing winters. (If there is a prolonged recession, an increase in homelessness is nearly certain to follow.) If public schools remain closed, low-income students displaced from their homes would face difficulties participating in online learning and fall further behind their more economically secure peers.
The racial disparity in who the virus has infected and killed has a parallel in the incidence of housing insecurity, and an analysis from the Urban Institute found the pandemic is also widening that gap, which has been exacerbated by housing discrimination and a slow recovery from the 2008 recession. Research by the Furman Center for Real Estate and Urban Policy at New York University supports that assertion.
“We did an early analysis of who worked in the types of industries that are likely to be affected and shut down by the virus, and disproportionately those workers were workers of color, and disproportionately they rent their homes,” said Ingrid Gould Ellen of the center. “The crisis has particularly devastated renters, both because they’re more likely to work in those vulnerable occupations but also because they’re also less likely to have savings to fall back on than homeowners.”
Early signs suggest a potentially deep crisis is coming. In Houston, a $15 million rental assistance program filled up in 90 minutes in May. That same month, sheriffs in Oklahoma announced they would be “compassionate & respectful during evictions.” Earlier this month, the mayor of Denver announced his support for temporary, managed campsites to help with the anticipated increase in homelessness in the city.
In April, the University of California, Berkeley, Terner Center for Housing Innovation estimated that 16.5 million rental households — or nearly 50 million people — would be affected by job or income loss due to COVID-19. An estimated 20 percent of renters missed payments in May, according to one analysis, followed by 30 percent missing housing payments in June and 32 percent in July.
Emily Benfer, chair of the American Bar Association’s Task Force Committee on Eviction and a visiting professor at Wake Forest Law School, said that multiple studies predict between 20 million and 28 million Americans could face eviction between now and September. For comparison’s sake, an estimated 10 million people lost their homes to foreclosure between 2006 and 2014 in the subprime mortgage crisis and resulting recession.
“It’s a combination of inequities that we have: Employment setting where we lack a living wage, we lack health insurance, we lack paid sick days, and so people in those industries aren’t able to create that safety net for themselves,” said Benfer. “People are paying on their credit cards, they’re taking out loans on their cars. The rent eats first, so they’re paying all they have toward the rent, and we know that because there’s been a huge increase in calls for food pantry assistance and other parts of the system being really stretched so rent can be paid.”
The brewing disaster would be bad enough if the pandemic were easing, but on Tuesday, Centers for Disease Control and Prevention Director Robert Redfield expressed pessimism.
“I am worried,” said Redfield. “I do think that fall and the winter of 2020 and 2021 are going to be probably one of the most difficult times that we have experienced in American public health.”
On Monday, the Urban Institute released an analysis of the situation and prescribed four potential solutions to stop renters from “falling off the eviction cliff.” Among the suggestions are extending unemployment benefits for at least six months, funding direct rental assistance, passing a national eviction moratorium and funding legal assistance for evictees.
“The thing that worries me is the tale of two experiences in the pandemic,” said Mary Cunningham, one of the authors of the Urban Institute piece. “There are the people who are working at home on Zoom meetings and who have the blessings of being able to keep their jobs, and then there’s folks who are working in industries that are hardest hit by the pandemic, and a lot of those jobs aren’t coming back, a lot of those have disappeared forever. How do you make sure that as workers regain their footing that they can stay housed? I think it’s going to be a long recovery, and that speaks to the need for housing assistance even more than ever.”
In May, the House passed the HEROES Act, which would provide an additional round of stimulus checks and extended unemployment benefits, and other measures including funding local and state governments and the U.S. Postal Service, as well as additional testing and tracing for the virus. That bill has stalled in the Senate.
At the end of June, the House also passed a bill sponsored by Rep. Maxine Waters, D-Calif., that would provide $100 billion to emergency rental assistance programs and create a $75 billion relief fund for homeowners. That legislation has also stalled in the Senate, where Sen. Sherrod Brown, D-Ohio, has proposed a corresponding bill.
“Right now, too many families are in danger of losing their homes — of being evicted or having their house foreclosed on,” Brown told Yahoo News in a statement. “The last thing we need in the middle of a public health crisis is families being turned out on the streets. Our families and workers should not be left to fend for themselves, but Leader McConnell has refused to take up legislation to help keep them in their homes for months, saying he saw ‘no urgency.’ Congress must step up now to provide relief to keep renters and homeowners in their homes and make sure that we don’t emerge from this crisis with greater racial and economic disparities than we had before.”
Separate legislation for a nationwide eviction moratorium through the duration of the pandemic is also being pushed in Congress by Sen. Elizabeth Warren, D-Mass., and Reps. Barbara Lee, D-Calif., and Jesus “Chuy” Garcia, D-Ill.
“As more workers are losing their jobs or having their hours limited, families are put at risk of missing rent or forgoing food on the table. We can’t allow people to be on the streets in the middle of a public health crisis,” Lee said.
The rent moratoriums are a helpful short-term balm, but they have limits: The rent isn’t canceled, simply deferred, meaning that at some point tenants have to pay it. If you have no source of income and the federal government stops issuing payments, you cannot put aside money to cover back rent.
“Some states have lifted their moratoriums on the basis of, the economy is open so you can get a job and pay the rent,” Benfer said. “The problem with that reasoning is that we have this back rent that wasn’t paid, and so it’s not enough for people to go back to work or find alternative employment opportunities. We have to deal with this back rent to keep people housed. Rent relief is designed to cover that back rent, not just for the tenant but for the property owner.”
“The moratorium is an extended period without payment, so it can have a sort of waterfall effect,” said Ellen. “If landlords can’t pay their mortgages, then investors — some of whom are pension funds — can’t get their payments. Landlords can’t pay their property taxes [to support] local governments who are reeling from the fiscal effect of this crisis already, and they may not be able to afford maintenance to keep properties safe.”
The Washington Post reported Tuesday that the White House is open to a renewal of the expanded unemployment insurance but at a number below the current $600-per-week mark. The program, benefiting approximately 30 million Americans, will expire at the end of July without an extension. The moratorium on evictions from federal housing is set to end as well.
Broader measures have also been proposed. In April, Rep. Ilhan Omar, D-Minn., introduced legislation that would cancel all mortgage and rent payments during the pandemic, a position pushed by activists across the country. The plan included a relief fund for landlords and mortgage holders to cover losses from the canceled payments.
“Congress has a responsibility to step in to stabilize both local communities and the housing market during this time of uncertainty and crisis. In 2008 we bailed out Wall Street,” Omar said. “This time, it’s time to bail out the American people who are suffering.”
What happens if no bailout comes and Americans are left to deal with the rent crunch amid a pandemic and double-digit unemployment without any support from the federal government?
“If Congress doesn’t pass rental assistance, I think we are going to be facing a very dark fall and winter,” Cunningham said. “It’s millions of people facing evictions, landlords not being able to pay their mortgages, sending ripple effects across the housing market and increasing visible homelessness in the street. We already had a half million homeless in the country, and that was in good times.”
“I worry that people will think I’m coming across as alarmist, and I’m really just using the data,” Benfer said. “I’m looking at this data and I feel like we need to be sounding the alarm. We are on the brink of the most severe housing crisis of the century, and I’m not seeing any meaningful movement.”
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