EDITOR NOTE:A few sobering snapshots to show what’s really going on with the economy: up to 30% of Americans missed their house payments in June, May, and April. Enhanced unemployment benefits are about to expire, and, as if things couldn’t get any worse, there’s been a surge in COVID-19 cases as businesses in several states have attempted to reopen. Many of these jobs aren’t coming back. We may be facing a massive increase in potential bankruptcies (businesses and households) across multiple states. But before that, we’re looking at a wave of evictions and foreclosures. Is this the fundamental case for a V-shaped recovery?
As the United States continues to face record unemployment due to the coronavirus pandemic, 30% of Americans missed their housing payments in June, according to a survey by Apartment List, an online rental platform.
That’s up from 24% who missed their payment just two months earlier in April and about on par with the 31% who missed payments in May. Renters, younger and lower-income households and urban dwellers were the groups most likely to miss their housing payments, Apartment List found.
At the same time that this “historically high” rate of Americans are missing their housing payments, eviction protections put in place at the beginning of Covid-19′s spread in the U.S. are beginning to expire. Additionally, the current 30 million unemployed Americans will lose the extra $600 per week in federal unemployment benefits at the end of July.
Taken together, experts warn of a coming housing “apocalypse” unless the government intervenes. Some 37% of renters and 26% of homeowners are at least somewhat worried that they will face eviction or foreclosure in the next six months, Apartment List reports. Columbia University researchers estimate that homelessness could increase by between 40% and 45% this year over where it was in January 2019.
Some legal experts expect “at least” 50,000 eviction filings in New York City alone when the state’s blanket eviction moratorium lifts June 20, most for nonpayment of rent. (A more restricted eviction ban is in place in the state until August 20.)
“In the current climate, with unemployment at record levels and with many unable to pay rent for Covid-related reasons, neither housing court judges nor our lawyers will be able to resolve many of these disputes, resulting in evictions, displacement, homelessness, senseless exposure to infection and more difficulty in containing Covid-19,” writes The Right to Counsel NYC Coalition in a letter to Lawrence K. Marks, Chief Administrative Judge at the New York State Unified Court System.
To prevent a homelessness crisis, governors could extend, or put into place for the first time, universal eviction moratoriums for the duration of the coronavirus crisis, advocates argue. Not only would this help keep people in their homes, it would keep Covid-19 from spreading even more in the U.S., where at least 118,000 people have died from the disease.
On the federal level, the House’s Emergency Rental Assistance and Rental Market Stabilization Act would allocate $100 billion for emergency rental assistance, which would help tenants around the country pay their rent and utility bills. The HEROES Act, which was passed by the House in May but has so far stalled in the Senate, includes an extension of the nationwide moratorium on eviction filings, hearings and executions for 12 months.
These are needed responses to a coming crisis, Solomon Greene, a senior fellow in housing policy at the Urban Institute, previously told CNBC Make It.
“Housing instability has huge health consequences even when we’re not facing a pandemic,” says Greene. “Exposure risk is so much more amplified and worsened when you can’t shelter in place because you don’t have a place to shelter.”
Originally posted on CNBC