Now that the Supreme Court hasfor most of the United States, up to 3.5 million households are at risk of losing their homes, including hundreds of thousands of renters this year alone, according to a Wall Street analysis.
This is because federal rent assistance took an extremely long time to reach tenants, with only 10% of the available funds having been spent by the end of July. Another factor is that many tenants behind on rent are in large cities where housing markets are tight, making them more likely to be evicted, Goldman Sachs analysts said in a research note on Monday. .
“The strength of the housing and rental market suggests that landlords will try to evict late renters unless they get federal help. And evictions could be particularly pronounced in the harshest cities. affected by the corona crisis because apartment markets are actually tighter in these cities, ”Goldman Sachs analysts wrote. “It reduces the incentive for landlords to negotiate with delinquent tenants or to wait for federal assistance.”
Goldman Sachs researchers used figures from the Census Bureau and homeowner business groups to estimate that 2.5 to 3.5 million households are in arrears with rent. About 2 million of these families live in properties owned by small owners, the investment bank found.
While tenants in a few large states, including California, Illinois and New York, are currently protected from evictions under state law, “about 90% of the country will lose access to these emergency protections. ‘here is the start of the fourth quarter,’ Goldman said. . Theputs 1 to 2 million additional households at risk once state protections expire, according to analysis.
That means 750,000 households could be evicted later this year under current policy, the researchers wrote. These evictions would also result in the loss of 20,000 additional jobs, Goldman estimated.
Other estimates see the potential for even greater fallout from the Supreme Court blocking a deportation ban. The National Equity Atlas, a project of Right to the City and the University of Southern California, estimates that more than 6 million households were in arrears with rent in early August.
One reason for this disparity is that a component of Goldman’s estimates assumes a typical annual eviction rate of 2.5%, which is common during times of strong job and economic growth. . If evictions neared their level during the Great Recession, hundreds of thousands more tenants would likely lose their homes.
Biden administration officials urged states to impose their own deportation bans late last week. Gene Sperling, senior adviser to President Joe Biden who coordinates the US bailout, urged local community groups on Monday to speed up the disbursement of rent assistance funds and cut down on paperwork. Some programs got bogged down with onerous application and documentation requirements.
“We need to speed up rent assistance everywhere,” Sperling said. “There is excessive caution and conservatism among many beneficiaries. ”
He compared the slowness of rent assistance to millions of tenants with the Small Business Paycheck Protection Program loans, which allowed landlords to qualify for large amounts of financing with minimal documentation. .
“There are times when you talk with people who run these programs, who are sincere, who are conscientious, but they don’t treat it like the urgency that it is,” Sperling said.