The Eviction Moratorium Is Over. Now What?

UPDATE: Since the publishing of this article, the CDC has issued an eviction moratorium through October 3 for areas of the country experiencing high rates of COVID-19 transmission. The ban on evictions will cover around 90 percent of the U.S. population.

Despite last-minute efforts to extend the expiring eviction moratorium, Congress failed to reach an agreement before the July 31 deadline, punctuating unknown housing fates for the millions of American households struggling with rental payments. While it’s unclear exactly how many renters face eviction, a survey from the Census Bureau revealed as many as 11 million adult renters are “seriously delinquent” on rent.

A brief timeline of the eviction moratorium saga

The Centers for Disease Control and Prevention (CDC) first issued an eviction moratorium from September 2020, responding to calls from former President Donald Trump to use its authority after the congressional moratorium expired last summer. The CDC’s eviction moratorium was intended to only last through the end of 2020, but it has since been extended several times as the pandemic’s hardships continue to weigh heavy on renters.

The CDC announced in June its intentions to extend the moratorium one last time, with the final extension set to expire July 31. A Supreme Court case brought on in late June by a group of southern landlords and real estate companies challenged the CDC’s authority to issue, and then continuously extend, the moratorium. A 5-4 vote, swayed largely by Justice Brett Kavanaugh, validated the CDC’s power and upheld the moratorium’s end date of July 31.

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The vote all but guaranteed a congressional showdown for another extension, with Kavanaugh writing any further moratorium would need “clear and specific congressional authorization,” thus tying the Joe Biden administration’s hands.

And that brings us to August: While many landlords are rejoicing in the lapse of the moratorium, renters are fretting over an uncertain future, and U.S. representatives are enjoying a month recess away from the humid, sticky D.C. summers.

What does this mean for renters and homeowners?

The congressional and CDC moratoriums were a saving grace for millions of Americans struggling with the economic ramifications of the pandemic. At the dog days of the pandemic, when housing became a form of healthcare with stay-at-home orders, evictions would have forced former renters and homeowners into particularly vulnerable situations, like homelessness or crowding in with family members and friends.

Check out past TriplePundit coverage that highlights vulnerability among the homeless and struggling tenants amid the COVID-19 pandemic.

Princeton University’s Eviction Lab credits the CDC moratorium with keeping as many as 2 million people housed since September. But even with the moratorium in place, landlords were busy filing eviction notices. In the six states and 31 cities where the Eviction Lab tracks data, landlords have filed for 451,772 evictions, including 7,238 in the week prior to the July 31 moratorium deadline.

Again, those numbers reflect only six, mostly low-population states (Connecticut, Delaware, Indiana, Minnesota, Missouri and New Mexico) and excludes major U.S. cities like Chicago, D.C., Los Angeles and San Francisco, among many, many others. The limited set reveals the challenges of collecting such data. The U.S. government, as well as many state governments, do not collect eviction records, instead leaving it to counties and local jurisdictions who often lack the sophisticated infrastructure to appropriately track such data.

Princeton University’s Eviction Lab has a host of truly remarkable tools. Play around with them and see the data for yourself here.

In a household pulse survey issued by the U.S. Census Bureau in early July, around 3.6 million people in the U.S. said they face eviction in the next two months. That fear may soon become a reality as the moratorium is lifted.

The ending of the moratorium comes as a number of factors may exacerbate the situation for renters and homeowners on the fritz: the delta coronavirus variant, rising rental prices and a slow release of federal aid.

Despite the vaccine roll-out, COVID-19 rates are on the rise once again as the delta variant spreads across the states. The CDC recently walked back its guidance that vaccinated persons cannot spread the virus, stoking revised policies around mask wearing in indoor settings. The AP reports that evictions will likely be worse in the south, where tenant protections are weaker and vaccination rates are lower, especially among communities of color: not the ideal recipe for an eviction amid rising COVID rates.

The moratorium expiration also coincides with rising prices in housing, for both rentals and homeownership. High housing prices have driven prospective homebuyers to delay their purchases, leading to a more crowded rental market. An apartment list report published in late June shows that the median apartment rent rose 9.2 percent in the first half of 2021, tripling the pre-pandemic rate. And there’s no reason to believe that trend won’t continue to worsen as experts predict millennials (who aren’t graduating from renters to homebuyers) are expected to continue powering this demand.

The last factor, the slow release of federal aid, is bottlenecking stimulus money set aside for rental assistance. Of the nearly $47 billion dedicated to rental assistance in the stimulus bill, only $3 billion has been distributed. With the moratorium expired, time is running out for the federal government to proactively distribute these funds directly to vulnerable tenants and to states who will oversee $21.5 billion of the pool.

What landlords are saying

There is a group that stands to gain from the expiration of the eviction moratorium: landlords. The ban on evictions has been particularly difficult for small, individual landlords, whose investments have been shattered by an inconsistency of monthly payments from renters. Their struggles are similar to the ones of small business owners since the pandemic started in early 2020. As they are still required to pay their property taxes to local governments, landlords whose tenants are late on rent payments have been given little to no options.

The money owed to landlords is significant. Research from the Aspen Institute puts the money owed to landlords at $20 billion, while a joint report from Jim Parrot of the Urban Institute and Mark Zandi of the Moody Institute suggest the total owed is much higher, $57 billion. The report from Zandi and Parrot indicate that the average renter is $5,600 behind on rent, translating to four months of delinquent payments. With the eviction ban lifted, landlords can start executing evictions and recouping funds erased from the pandemic.

It remains to be seen what the exact impact of the end of the eviction moratorium will be. Perhaps it will be the fire that ignites a swifter reaction from the government to disburse the $44 billion dedicated to rental assistance still in their coffers. After all, renters and landlords alike would stand to benefit from the government disbursal. For landlords, it represents the chance to finally secure back payments and renew a coveted revenue stream. For tenants, it’s a roof over their head while they reset from a year of financial and personal losses.

Image credit: Andra C Taylor Jr/Unsplash