State Eviction Moratoriums for COVID-19 Due to Expire As Unemployment Benefits Dry Up

When the coronavirus pandemic hit the United States, most states put a hold on evictions from rental properties. In many states, those moratoriums are expiring at about the same time that more generous unemployment benefits are set to dry up.

This one-two punch could easily worsen the housing crisis for Americans already bearing the worst of COVID-19s effects. According to a weekly Census Bureau survey measuring COVID-19s impact on Americans, 20% of adults polled in May said they had slight or no confidence they would be able to pay the rent or mortgage due in June. An Urban Institute analysis of Census data found nearly 25% of black renters deferred or did not pay their rent in May, compared with 14% of white renters.

In Michigan alone, courts are bracing for as many as 75,000 landlord/tenant filings (that state’s moratorium expired in mid-June).

The result of all this is that the pandemic – which forced an economic collapse – is adding new burdens on top of the country’s serious housing problems. Even before the current crisis, the United States had a supply and affordability problem. Unless significant support is forthcoming at the federal, state, and local level, it is going to get a lot worse. The result may be higher rates of homelessness – leaving more people on the streets in the middle of a global pandemic.

Even before the pandemic, our homeless shelter system was stretched thin and not set up for social distancing. In the best of times an eviction can have a devastating effect on a family; in a pandemic with an economic crisis, the situation is amplified.

Since the nation was not prepared for the pandemic (despite warnings from various sources for years), reactive measures were developed in haste and the result was a patchwork of eviction halts with varying lengths and caveats.

  • Moratoria in places like Texas have lapsed;
  • Others will expire very soon – including Louisiana and Pennsylvania – while some states such as New York have announced extensions.
  • San Francisco essentially made its moratorium permanent, prohibiting landlords from ever using missed rent for pandemic-related reasons as grounds for eviction. This essentially means any rent lost during the pandemic due to a loss of a resident’s income is lost forever. This is an awful piece of legislation that is likely to have a domino effect that will harm both tenants and property owners. Landlords need rental income to pay bills, provide tenant services, pay mortgages and taxes; the city needs tax income to pay workers and fund essential services.
  • Federal help was limited to housing with federal assistance and that moratorium will expire on July 25.

Both landlords and tenants need to understand that an eviction moratorium is not a rent freeze – which means that overdue rent is still accumulating for tenants who have been unable to pay it. Once a moratorium expires and landlords can get court approval to take or resume eviction action, residents could be months in the hole – with little to no chance of catching up.

Even more concerning, some of the expirations coincide with the stoppage of more generous unemployment benefits (the $600 per week) that have helped keep unemployed individuals above water. Congress is still debating whether to extend enhanced unemployment benefits beyond July 31, but Senate Republicans are not in favor of such an extension.

While it may be possible (and advisable) for landlords to negotiate with tenants before evicting them, landlords are feeling the pinch. However, the cost of evicting an existing tenant may not be worth it, particularly if there is little demand from new renters.

Each property owner will have to assess how to move forward based on individual circumstances, but if a reasonable payment plan with residents appears feasible, it may be a better option than eviction.