Apartment tenants who have fallen behind on their rent face catastrophe at the end of the year, as Congress and President Trump have yet to approve emergency aid for renters or extend an eviction moratorium beyond Dec. 31, when it is set to expire.
An avalanche of evictions could add to the severe economic distress already being felt by middle- and low-income Americans. People are lining up at food banks in record numbers. Nearly 8 million people have fallen into poverty since the summer, according to a recent study.
In Austin, the pandemic has shattered the city’s tourism business, long built on music festivals, barbecue and University of Texas sports. That has sent thousands of cafeteria workers, airport staff, housekeepers, drivers and waitresses home without work.
“All that is shut down,” landlord Cary Krier said of Austin tourism. “And those are my people. Those are the people who rent from me.”
Earlier this week, Congress approved a stimulus package that would have offered at least a temporary reprieve: $25 billion in emergency aid and a month-long extension to the federal moratorium. President Trump then shocked lawmakers Tuesday night, arguing the bill was a “disgrace” because it offered “ridiculously low” $600 stimulus checks. He demanded $2,000 checks instead, though he did not mention that his own treasury secretary had pushed for the lower amount and had told lawmakers that the president would support the legislation.
With the stimulus package in limbo, 14 million Americans are slated to lose unemployment aid on Saturday and the government is set to shut down on Tuesday. Lawmakers, who had been wrangling over the bill for months, have not yet devised a plan to avoid those deadlines.
The eviction moratorium, issued by Trump in September, bars the removal of tenants earning less than $99,000 annually from their homes provided they certify to the Centers for Disease Control and Prevention that they have suffered a “substantial loss of household income” or other losses related to the pandemic, and that they would be homeless if they lost their apartments.
That has left struggling tenants and their landlords in a state of purgatory, in which some renters cannot pay but their landlords cannot do anything about it.
Although courts are prevented from evicting renters who qualify for the moratorium, landlords in many jurisdictions aren’t prevented from taking earlier steps in the legal process, such as filing eviction notices. As a result, such notices have piled up, including more than 162,563 of them in 27 cities, according to data gathered by Eviction Lab, a project by Princeton University researchers that tracks evictions nationwide.
Krier’s company, Austin-based Firmus Equity Partners, owns about 1,600 apartments in the area. He said that after a swell of tenants fell behind on rent in late summer, emergency rent programs and unemployment insurance allowed many to catch up, but their underlying problem ― jobs that have not returned ― has not been resolved.
“The problem is as soon as they get caught up, if they don’t have a job, then what happens?” Krier said.
Austin tenants are luckier than most. Eviction bans have been in place there throughout the pandemic, so filings nosedived once the pandemic started and remained at that level, data shows. During the week of March 15-22, landlords filed 129 eviction notices against tenants. Since then, landlords have filed a total of only 725, according to Eviction Lab.
Renters in other cities appear to be at greater risk.
A local moratorium in Milwaukee provided renters with a respite through May, but at the beginning of summer, eviction filings quickly increased. From March 15 to Dec. 13, Milwaukee landlords filed 5,759 notices against tenants, almost eight times the number filed in Austin despite Milwaukee having 60 percent of Austin’s population. Milwaukee did not have a local moratorium in place between May 27 and Sept. 4, when the CDC moratorium took effect, while Austin has been restricting many landlords from even giving initial notice to tenants.
Among landlord Dan Bruckner’s holdings in the Milwaukee area is a five-building complex with 88 single-bedroom apartments on the city’s north side. The rent is $465 per month.
Bruckner said he considers himself more lenient than other landlords but says it isn’t out of generosity. “I work with tenants probably more so than most because I don’t want to re-rent the apartments. So if I can keep a tenant, I do,” he said.
He said recently that he had 21 delinquent tenants and ticked through their situations: A hotel worker who had been laid off twice. A FedEx driver who quit his job out of concern for his mother’s health. A dancer who received emergency funds. A coffee roaster whose hours had been cut. A personal-care worker who had been laid off. He suspected others had the money but refused to pay; those were the tenants he said he would pursue most aggressively once the CDC moratorium is lifted.
Bruckner supports additional emergency aid but said the moratorium needed to go. “Right now if [tenants] don’t pay they can squat, and the government will back them up,” he said.
Bruckner is now doing what for him is usually unthinkable: keeping available units empty for fear the new tenants will not pay and he will have no recourse. Seven of his 88 units at the complex were recently available.
“If they open up the courts, I will be more generous. I will start taking chances on people again.”
Even if Congress and the Trump administration come to an agreement in the next week, tenant advocates and landlords agree that the problem of tenants facing eviction because of the continuing pandemic is much deeper and will probably take much more to solve.
Trump and President-elect Joe Biden have both backed various efforts to support renters and homeowners. On Dec. 2, the Federal Housing Finance Agency extended its moratorium on foreclosures of single family homes backed by loans from Fannie Mae or Freddie Mac until the end of January.
Trump has been “adamant on delivering relief to workers, families, and small businesses” said White House spokesman Ben Williamson, in a statement.
Biden has called for additional aid after he takes office Jan. 20. In announcing Rep. Marcia L. Fudge (D-Ohio) as his nominee to lead the U.S. Department of Housing and Urban Development, Biden said Fudge would employ “every lever at her disposal to help the millions of Americans facing eviction.”
When the CDC moratorium ends, advocates expect to see an increase in eviction cases, even as cases of the coronavirus surge and winter temperatures drop.
“Throwing people out of their homes right now is a very bad idea,” said Peter Hepburn, a research fellow at Eviction Lab. He said evicting people would lead some to double- or triple-up with family or friends, which could exacerbate the spread of the virus. Others may be forced onto the streets.
Data show the evictions will affect minority communities disproportionately, as a majority of people who say they have failed to pay their rent recently are minorities, according to the Census Bureau Household Pulse Survey. Nearly a quarter of the renters who identify as Black or Hispanic have already missed payments or cannot pay rent for the next month, compared with 17 percent of White renters. One in five tenants responded saying they are not paying rent currently or could not next month.
In Tampa, eviction filings increased dramatically in July after local eviction bans expired, according to Eviction Lab. More than 300 were filed in the week ending Dec. 13, and 7,242 have been filed since March. That is less than the average in recent years, but experts predict the numbers to rise further when the CDC ban ends.
“We are expecting a big uptick in filings,” Jim Baker said. His advocacy group, the Private Equity Stakeholder Project, has chronicled around 20,000 eviction filings by corporate landlords since the CDC moratorium began. Its data shows that in Hillsborough County, which includes Tampa, 137 companies have filed a total of 1,437 eviction cases as of Sept. 1.
“It’s quite common to see complaints filed now where the resident is several months behind,” he said.
The CDC moratorium and local measures like it are coming under increasing legal scrutiny. A D.C. Superior Court judge ruled that the District’s own moratorium violated landlords’ rights and needed to be modified. A federal lawsuit filed in Georgia by the New Civil Liberties Alliance on behalf of three landlords argues the CDC moratorium issued by Trump represented an overreach of the agency’s authority.
“No government agency can take away someone’s right to access the court system,” said Mark Chenoweth, NCLA president, in an interview.
Industry groups have joined the lawsuit, including the National Apartment Association, which represents more than 90,000 companies that own more than 10 million units. Even with the $25 billion in assistance for renters, the group argues that the moratorium should be allowed to expire.
“What a moratorium does is put off that inevitable event. It saddles renters with an enormous amount of debt that they are going to have a very difficult time paying,” said Greg Brown, the group’s senior vice president of government affairs.
He said landlords in many cases are “doing everything they can to try to keep folks in their homes.”
In the meantime, landlords are wrestling with how to run their businesses when so many of their tenants can no longer pay the bills.
Milwaukee landlord Youssef Berrada owns more than 8,000 units and was the subject of a 2018 investigation by the Milwaukee Journal Sentinel over his eviction practices involving low-income renters. During the pandemic, Berrada (who is not a party to the lawsuit) has been working with legal aid groups to help tenants avoid evictions whenever possible, according to his attorney, Joe Goldberger.
“We will continue to work with community groups and will file evictions only when there is no reasonable alternative to doing so,” Goldberger said in an email.
At the same time, Goldberger said the CDC moratorium had placed an unprecedented burden on the company by prohibiting evictions without providing financial assistance.
“Being a landlord is like any other business — a service is provided, and payment is expected for that service,” Goldberger said.