Virtual Hearing - The Rent Is Still Due: America's Renters, COVID-19 and an Unpre...(EventID=110774)

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Connect with the House Financial Services Committee Get the latest news: https://financialservices.house.gov/ Follow us on Facebook: https://www.facebook.com/FinancialDems/ Follow us on Twitter: https://twitter.com/FSCDems ________ On Wednesday, June 10, 2020, from 12:00 p.m. (ET) - - - - - - - - - - - - - - - - - - - - - Witnesses for this one-panel hearing will be: • Cashauna Hill, Executive Director, Louisiana Fair Housing Action Center • Mike Kingsella, Executive Director, Up for Growth • Ann Oliva, Visiting Senior Fellow, Center on Budget and Policy Priorities • Jenny Schuetz, Fellow, The Brookings Institution Impact of the COVID-19 Pandemic on Renters There are approximately 44 million renter households in America, about a third of whom live in single-family home rentals, 4 percent in manufactured homes, and the remainder in multifamily housing. Prior to the COVID-19 pandemic 47.5 percent of renter households in the U.S. were cost burdened, meaning they were paying over 30 percent of their income on rent, and nearly 2 percent of renters (1.4 million adults and 810,000 children) were threatened with eviction over the course of just three months in 2017. The Terner Center for Housing Innovation estimates that as a result of COVID19, about 43 percent (or 7.1 million) of households likely impacted by the COVID-19 pandemic were already cost burdened. While unemployment insurance (UI) may help renter households cover their rent, it is estimated that families receiving the minimum monthly UI benefit from their state plus the additional $600 provided by the federal government would still likely be cost burdened in all but six states and may still struggle to pay their rent. In fact, as the pandemic has progressed, more renters have been unable to pay their rent. According to a survey conducted by Apartment List, more than 30 percent of renters were unable to fully pay their rent at the beginning of May 2020 (an increase of 8 percent since April), with 22 percent of renters being unable to make any payment at all (an increase of 10 percent since April). According to a U.S. Census Bureau survey conducted between May 14 to 20, 34 percent of renter participants responded that they had little to no confidence that they would be able to pay next month’s rent on time. Even among renters who have made their rent payments on time, there has been a concerning trend of increasingly relying on credit cards to do so. Zego, a digital rent payment platform, reported a 30 percent increase in tenants using credit cards to pay rent in April compared to the month prior. While paying rent with a credit card may help renters avoid eviction in the short term, it could lead to them facing high interest rates and deeper debt that could impact their credit in the long term. Many states and localities imposed eviction bans beyond the federal moratorium provided in the CARES Act, but as these bans have begun to expire, tenant advocates are reporting a sharp increase in the number of evictions being filed. Renters living in single-family rentals (SFR) owned or managed by private equity firms may be particularly vulnerable to evictions during the pandemic because, compared to other rental properties, private equity SFRs tend to be less regulated at the local level than multifamily rentals. For example, private equity SFRs are not subject to rental control laws in California, which allows firms to increase rents at their own discretion. Congressional Response to Date In order to provide relief for renters, the CARES Act included an eviction moratorium and prohibition on late fees for nonpayment of rent or other charges until July 25, 2020 for renters living in “covered dwellings.” The eviction moratorium and prohibition on fees under the CARES Act is limited to properties that are federally subsidized or have a federally-backed mortgage. Despite the moratorium, some landlords have filed for evictions on tenants protected by the moratorium. However, the eviction moratorium does not relieve tenants from having to pay any unpaid rent amounts during the moratorium, which a landlord may demand as a lump sum after the eviction moratorium expires. In order to provide relief for housing providers, the CARES Act included multifamily mortgage forbearance for up to 90 days for federally backed mortgages. Single family rental property owners have access to the same mortgage relief under the CARES Act as other single family homeowners. However, the multifamily and single family mortgage relief provided is limited to federally backed loans, to the exclusion of approximately half of the multifamily mortgage market and approximately 30 percent of the single family mortgage market. Further, mortgage relief does not assist landlords who do not have mortgages associated with their rental homes at all, who are disproportionately mom and pop investors.... Hearing page: https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=406611