America faces an eviction outbreak that could reach pandemic proportions. The CDC eviction moratorium expires on March 31, and Illinois' moratorium ends three days later on April 3. Immediately afterward, tenants face eviction, trying to find housing with eviction records, and homelessness. (For their part, landlords face foreclosures, asset seizures, and bankruptcy.) A patchwork of state, county, and local assistance programs have tried to compensate for rent backlogs, and many landlords, especially smaller Black and Latinx ones, have worked with tenants on rental deferment and repayment plans. Still, the Urban Institute describes how these efforts were probably "not enough." Projections estimated that up to 14.2 million households would owe late rent by January 2021, with an average debt of $5,600 to $6,000 .[1]
We anticipate a wave of clients experiencing homelessness or imminent risk of homelessness in the coming months. Our blog typically focuses on sharing our services and successes; however, we, we want to step back and look at the larger housing and other economic trends behind this surge.
Moratorium Limits
Eviction moratoria were never absolute. The original federal eviction moratorium only protected 30 percent of all renters. Other state, county, and local bodies created protections, but the glut of inconsistent and overlapping programs made "navigating the bureaucratic process nearly impossible for the average tenant." Programs had stipulations that low-income, non-English speaking, elderly, and disabled tenants struggled to meet and permitted landlords to file for eviction based on non-COVID-19 related reasons. Stanford University's Eviction Lab found that landlords in its sample communities have filed nearly 273,000 evictions to date—including 5,300 in the last week. And, as we've written about in the past, some landlords have resorted to illegal, "self-help" evictions like locking tenants out, shutting off utilities, removing their belongings, and/or other harassment.
The Precarious Housing Market
COVID-19 pushed an already unworkable housing market to the breaking point. Even before the pandemic, a full-time, minimum wage worker could not afford a two-bedroom apartment anywhere in America (in Illinois, for example, someone would have to work an 85-hour week at minimum wage to afford housing). Nearly half of all renters (20 million households) were "housing burdened" or devoting 30 percent or more of their income to housing. Almost two-thirds of burdened households had less than $700 in the bank, with half only holding less than $10. Financial crises like job or wage losses could send them spiraling into homelessness.
Half of lower income workers reported job or wage losses, due to the pandemic, including more than 9 million retail and leisure/hospitality workers. These sectors disproportionately employ workers with less formal education and Black and Latinx workers. Most could not work from home compared to "information workers" in business, finance, and legal (as well as nonprofit blogging sectors). Even as businesses reopened, many low-income workers returned to lower wages, fewer tips, and less healthcare coverage. The most recent US Census' Household Pulse survey, which tracks household experiences during the pandemic, shows that:
- Nearly 20 percent of renter households could not meet last month’s rent.
- Nearly 30 percent had no or only slight confidence they can meet next month’s rent.
Households have tried untenable solutions to pay rent. The Philadelphia Federal Reserve Bank found a 70 percent increase in households using credit cards. The predatory lending industry has also dangled loans with interest rates of 200-500 percent[2]. These options only defer payments for a little while longer, and, when they come due, households will face grossly inflated debt.
What We're Doing
We've already helped low-income households and their landlords secure IHDA Emergency Rental Assistance, and we've just received a substantial grant to assist them in applying to the Illinois Rental Payment Program, which may offer up to $15,000 for past due rent. We'll be starting focused outreach to help our communities' most vulnerable residents and landlords remain housed and solvent. We continue to offer an array of Prevention and Stabilization services to keep households at imminent risk of homelessness in housing, as well as motel-based shelter and transitional housing programs.
To support households facing eviction, click here.
[1]Even in our "big data" driven culture, we can only estimate the amount of rental arrears and evictions (somewhat akin to how we can only estimate the number of people experiencing homelessness). Figures cited here come from projections that relied on limited surveys and non-housing related data, like unemployment claims. We can't fully acknowledge the scale of renter insecurity and evictions, which are disproportionately affecting Black and Latinx households.
[2] Speedy Cash, for example, makes payday loans seem empowering. They lure lendees with promises that loans will help them "Reset. Refocus. Restart." Their webpage even has a blog full of articles to help them "live their best life" or some other wristband-ready cliché. If you want celebrity inspired pantry organization tips, budget friendly makeup advice, or dating on a dime suggestions, pay it a visit. Just don't trust their list of ways to cope in the age of COVID-19, which leaves out "don't take out a payday loans."
