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Do We Really Need a Moratorium on Evictions?

State and local bans have been of some help in keeping renters in their homes, but the federal moratorium hasn't had much impact. Targeted cash relief and an abundant housing market are the best tenant protections.

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A house eviction in Detroit, Mich. (Shutterstock)<br/>
Advocates for low-income Americans have warned of a “tsunami of evictions” ever since the COVID-19 pandemic first came ashore in early 2020. They foresaw tenants by the tens of millions losing shelter over missed rent payments and risking greater exposure to the coronavirus unless policymakers acted. Governments listened: 48 states issued eviction moratoria, as did many big cities and ultimately the federal Centers for Disease Control and Prevention. Now, President Joe Biden has renewed the CDC’s eviction moratorium for the fourth and presumably final time, to the end of this month, and last week a divided Supreme Court rejected an effort by landlords and real estate interests to lift the ban.

Is an eviction tsunami still just over the horizon? Tenant activists and progressive lawmakers seem to think so: A letter from 44 Democratic members of Congress said that renewing the CDC’s ban would “help prevent a historic wave of evictions,” and the National Low Income Housing Coalition called for “extending, strengthening and enforcing the federal eviction moratorium.” There’s just one problem: There’s little evidence that the federal government’s eviction ban actually has done much good. State and local moratoria have been better at curtailing evictions, but they came with more hidden costs to tenants and property owners, while other programs have proved far more effective at helping renters. Contrary to activists’ dire warnings, there is little to suggest that an eviction tsunami is really on the way.

But let’s back up. Some 3.7 million evictions are filed in a typical year, according to the Eviction Lab, and Princeton’s Matthew Desmond has famously warned that “eviction is a cause, not just a condition, of poverty.” When governors and mayors issued stay-at-home orders early in the pandemic, they were depending on residents having a home to shelter in. Renters also lost income as the economy shuttered, and more than 7 million tenants were behind on rent by September of last year, with roughly a million of these households saying eviction was “very likely” in the next two months. So the CDC’s order, issued that month under President Donald Trump, banned evictions for missed rent payments provided that tenants signed a “hardship declaration” and met generous income limits. Today, the arguments in favor of a federal eviction moratorium range from the slow disbursement of rental support and the low vaccination rates in minority communities to, well, eviction just being bad.

Yet in March, the Government Accountability Office found that the CDC’s eviction limits had little impact on filings. The places that kept a relative lid on evictions also had local moratoria, experiencing a median decrease of about 91 percent in eviction filings in December 2020 compared to the same period a year earlier, while jurisdictions under only the CDC's limits saw a decrease of just 36 percent. For those facing eviction, only about one in eight took advantage of the CDC moratorium. It turns out that the nation’s primary public health protection agency isn’t very good at implementing housing policy.

Even the case for local moratoria may be overstated. Most of the places that removed eviction bans in May and June last year didn’t see a resulting surge in evictions. Even in states and cities that did see a spike, they were all less than pre-COVID levels. It’s true that Milwaukee’s eviction filings jumped by 44 percent in the first two weeks of last June after the city’s eviction moratorium was lifted, but the rate quickly decreased as courts worked through a backlog of cases and still remained well below pre-pandemic levels. Oklahoma didn’t have an eviction moratorium, and yet filings dropped by half, as much as in some jurisdictions that did have a moratorium.

The market and generous government aid seem to have done far more to avert an eviction crisis than the various moratoria on the books. The share of households paying their rent on time did fall in 2020 but not by much, declining by an average of just 1.5 percent from April to December compared to the same period in 2019. Stimulus checks combined with an extra $600 a week for many unemployed workers made a remarkable difference for helping tenants make rent. And arguably landlords had little incentive to boot out otherwise good tenants who were temporarily struggling to pay their rent when, at least in the direst parts of 2020, it was unclear whether they’d readily find replacement tenants. Most tenants experiencing financial hardship during the pandemic were either able to work out deals with their landlords, borrow money from friends or family, or use government subsidies to avoid eviction.

Nationwide, economic hardship from the pandemic has declined since peaking in December 2020. Renters are more confident in their housing security than even a few months ago, according to a new analysis by Zillow, and in contrast to the unmet fear of 30 to 40 million evictions last year, the number at risk of eviction today is closer to 2.7 million. While it is true that renters of color suffered more during the pandemic and are likelier to still be behind on rent, this is a case for financial aid more than for a blunt, crisis-induced eviction moratorium. If anything, the moratoria may have simply dug renters into a deeper hole; after all, they still owe the back rent that’s been piling up, leaving some with potentially insurmountable debt. And according to the CDC’s moratorium order, landlords can still charge late fees, interest and other penalties for missed rent payments.

Helping renters receive financial aid and get better terms from property owners would do far more to avert painful evictions. Nearly $50 billion in federal rent relief money is now available to renters. The problem is processing these dollars through some 400 state and local housing programs; Texas has issued 37 percent of its relief funds to renters, compared to less than 4 percent in Arizona. There is every reason to push for this money to be distributed quickly and efficiently, as recent Treasury Department guidance is helping to encourage.

Potentially as significant are programs at the state and local levels to encourage renegotiation between property owners and tenants short of eviction and to reward forbearance. Some landlords are behind on their mortgage payments as well, particularly smaller property owners and the 30 percent of landlord households that are low- and moderate-income. Missed rent payments all too often mean skipped mortgage and property-tax payments, which cascades harm throughout communities.
None of this has stopped advocates and lawmakers from pushing for more expansive eviction moratoria at the federal level. Democratic U.S. Rep. Steve Cohen of Tennessee, for example, is proposing an open-ended “emergency” eviction moratorium whose wording means possibly endless tenant regulations with criminal and (severe) financial penalties on property owners. Members of the progressive “Squad” in Congress are calling not only for an extended and strengthened federal moratorium but also for the cancellation of all rent and mortgage payments during the pandemic.

Such measures risk enormous harm to low-income families trying to secure affordable housing, since property owners would be incentivized to be choosier in who they rent to, and they make it less likely we’ll see an expansion of rental housing supply in general. There’s also the question of constitutionality: Three federal district courts have rejected the CDC’s eviction moratorium; one such court in Texas questioned whether Congress even had the authority to impose such a restriction across state lines. While voting with the 5-4 Supreme Court majority in refusing to lift the health agency’s ban, Justice Brett Kavanaugh wrote that the CDC had “exceeded its existing statutory authority by issuing a nationwide eviction moratorium” and that any extensions past July 31 would require congressional authorization.

The difference in renter households making their payments now compared to pre-pandemic is not so large as to suggest an eviction tsunami is crashing our way. Instead of placing renters’ hopes in blunt eviction moratoria of questionable value, we should target relief to where it’s needed and get back to a functioning housing market. Ultimately, abundant housing is the best tenant protection — which we won’t get as long as stringent and ineffectual eviction moratoria are in place.

Governing's opinion columns reflect the views of their authors and not necessarily those of Governing's editors or management.
Michael Hendrix is the director of state and local policy at the Manhattan Institute. He can be reached at mhendrix@manhattan-institute.org or on Twitter at @michael_hendrix.
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