Federal money for people behind on rent expected to run out mid-year
The flood of evictions many housing advocates expected after the eviction moratorium was struck down in court last summer did not materialize. Officials point to multiple efforts to help millions of people stay in their homes, including the $46 billion in rental relief funneled through state and local governments, which has amounted to more than 4.7 million payments to help people avoid evictions during the pandemic.
But most of that money will be used by the middle of this year, Treasury Department officials say. Despite a slow start last year, officials announced on Wednesday that approximately $30 billion in emergency rental assistance was spent or obligated as of the end of February.
President Biden has signaled affordable housing was a top priority with his proposed 2023 budget unveiled earlier this week, but money for measures to increase affordable housing lies in the hands of Congress.
According to the Eviction Lab at Princeton University, eviction filings remain well below normal, pre-pandemic levels. Their researchers suggested this could be in part due to the emergency rental assistance. Treasury Department data showed more than 80% of the rental assistance was delivered to very-low-income households last year and many of those recipients were people of color and women.
When the Emergency Rental Assistance money was included as part of the COVID relief measures passed by Congress in late 2020 and early 2021, the U.S. had no national infrastructure to help people behind on rent keep from being evicted. Federal, state and local officials across the country had to scramble to get programs in place.
It "has helped keep eviction rates well below historic averages throughout the pandemic," said Deputy Treasury Secretary Wally Adeyemo.
As the money runs out, officials are pushing for state and local governments to use other federal funds to help struggling renters and to bolster other housing efforts. The American Rescue Plan included $350 billion in money for state and local governments which can go toward this effort, officials said.
As of the end of 2021, some $11 billion in funds have already been committed for housing efforts, from rental and mortgage assistance and eviction prevention efforts to affordable housing.
"We hope what this will do is support both the lasting eviction prevention infrastructure as well as provide a springboard for much needed investments in affordable housing supply," said Jacob Leibenluft, Treasury's chief recovery officer.
Leibenluft noted that using the money to increase the amount of affordable housing has been a major area of interest for state, local and tribal governments across the country from cities to rural communities. As of the end of last year, more than 350 governments had put state and local recovery money toward housing — a figure expected to grow this year.
This comes as the cost of rent is on the rise nationwide. The average monthly rent landlords were asking for in January was up a record 15.2% from a year ago, according to a report by Redfin. The national median monthly mortgage payment for homebuyers was up 25%, the biggest increase in Redfin's records.
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