It was clear that the end of the pandemic eviction moratorium was going to produce our now normal toxic mix of mindless hysteria, as if it comes as a surprise that it would, eventually, end and tenants would have to pay up what they didn’t pay, whether because they couldn’t afford to pay or could get away with not paying, since the moratorium began.
Did renters think that once the moratorium was over, they would be forgiven the rental payments they didn't make during the pandemic?
— Scott Greenfield (@ScottGreenfield) August 1, 2021
With Congress away on vacation, except for thrice-evicted Rep. Cori Bush who has taken to sleeping on the steps of capital to get her name in the paper, the moratorium reached its sunset as the Supreme Court anticipated when it gave the case a pass until the end of July, despite the clear admonition that the CDC had no authority to issue such a mandate.
Congress, apparently, believed that the president would ignore the Supreme Court and do that Biden voodoo to keep the moratorium going. Biden expected Congress to read Justice Kavanaugh’s concurrence and actually do its job. Both were disappointed.
Since Congress had left the building, and the backlash was heading straight at Biden, he issued a directive to federal agencies to try to find some way to circumvent the law and bureaucratically reinstate the eviction moratorium, despite it clearly being ultra vires, simultaneously trying to shift the burden to states to put their own moratoriums in place and distribute already dedicated pandemic funds to pay the rent, even though they might be more inclined to use the funds for other purposes since they couldn’t be evicted if there was a moratorium in place.
It’s not like anyone shouldn’t have seen this clash coming from a hundred miles away, and yet here we are as the outrage debate rages. But stop-gap remedies aside, there is a fundamental question posed by this man-made fiasco: Who suffers?
Tenants got to live in their apartments without fear of eviction for not paying rent. Some paid, honest fools that they are, but many didn’t. Some couldn’t. Many could. They just didn’t. They were still working, still earning a living, plus getting pandemic checks, and simply chose to put their money to more fun uses, as is the American way.
Landlords could do nothing to compel a tenant to pay. They still had to maintain the buildings, heat them, repair them, pay the taxes and mortgage on them, whether their tenants were paying the rent or not. While big landlords are generally despised, even though they too are allowed to run their businesses, many small landlords for whom their rental properties are their source of income to put food on the table, were hit just as well.
Somebody has to take the rent hit, both in the interim and in the long run. Eviction is a threat, but it rarely serves to get money paid from the year and a half that’s in the rearview mirror.
But then, there are many who see the easy answer to fall in the hands of their benevolent government to provide the funds to smooth over this shortfall, which means that this becomes another burden on the taxpayer. While the landlords have a stronger position to expect governmental intervention, the eviction moratorium being a federal impairment of their ability to take action against non-paying tenants, it still puts the onus on the taxpayer.
As for renters, government easing their payment obligations from its magic money tree seems like an entitlement. After all, isn’t housing a right and no one in this wealthy nation should find themselves homeless, houseless or cardboard dependent, even if they continued to earn a paycheck while living in their penthouse.
Who takes the hit here? Someone has to, because that’s how it works. Is it the tenant, the landlord or the rest of us? More importantly, why?
*Tuesday talk rules apply.
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The government, in its infinite wisdom, COULD have simply paid the landlords during the pandemic. They did not. So, we had a situation where the landlords were forced to extend charity whether they wanted to or not, and whether or not they could afford to do so. Naturally, with the moratorium ending, landlords want their money. In fact, many of the small landlords have no choice. And there are always renters who want a place, especially now. This is an ugly situation, because the landlords want their money, deserve their money, and will get their money; from a new renter, if not the original one. Barring a MASSIVE payout from the Federal Government, this is a tragedy for renters; a tragedy that was written with the moratorium.
And the hit to their credit report from non payment and eviction will make it harder for those folks to find new places to rent. But people rarely think that far ahead when they do something (I started to say silly) unwise.
Tenants need landlords.
Landlords need tenants.
When they run out of tenants with good credit and still need someone to fill the empty rooms, what’s a landlord to do?
I see overall rents are likely to go down as landlords compete for tenants who could pay based on credit checks and references. I don’t know where this leave tenants who were evicted. But the ending of the government-imposed moratorium on rent is going to have effects throughout the housing market.
AirBnB!
THE POLITICAL NUMBERS GAME AND THE RENT CRISIS
Maybe this is a dumb question: But why not pay the landlords directly to make up for money they’re losing on unpaid rents? Isn’t the objective to keep families and other renters in their apartments? Then landlords have cash for the upkeep of their apartments; easier, more efficient flow-through of money; in effect, the government paying the rent for tenants, but a different system. My understanding is that the idea is not for tenants to get money into their pockets, but to provide assistance for the cost of rent. So why is it necessary to cycle money through the tenants to the landlords? — except that tenants would make up a greater number of voters. Politicians never pass up a chance to create gratitude among prospective voters when a chance comes around. My thinking is based on the news that only about $3 billion of some $46 billion of the rent-assistance program has been distributed. The obvious solution is getting the huge sum to accomplish what it is intended to accomplish as quickly as possible; though the situation should never have turned into a crisis. I think of Obama’s rapid rush to save the banksters at the onset of the Great Recession. Apparently landlords don’t have high-placed, influential friends in D. C. Hence, as I pointed out, the political numbers game with an eye on voters edges out logic and effectiveness, again.
We’re going to need more trillion dollar coins to buy us out of this mess.
It will probably be the magic money tree again, since the capacity of the magic money tree to solve problems is legendary.
Hey, man, I have a giant freakin’ mortgage ’cause I live in a ridiculous place. Print away, baby!
Ultra vires.. not being a lawyer I had to look it up. What’s stopping landlords from saying two can play this game? A landlord could remove doors during cold weather or just give tenants notice or not and remove tenant belongings.
Police generally call this a civil matter and won’t get involved. I’m not advocating it and I’m curious if it’s happened yet.
I could give you a ton of other words to look up if I was allowed to get clients on the comment section of our Host’s blawg, but I’m not, and you shouldn’t be asking such stupid questions in the first place. Landlords do try to make their units uninhabitable from time to time as a way to get shitty tenants to leave. It usually doesn’t work out well for anyone except me. Go pay someone to fill in the gaps for you.
Nah,I’m pretty sure there are plenty of landlords that will say it was complete worth it to illegally remove shitty tenants . Again not advocating.
Pops, I’m so fucking sorry for my past transgressions, especially if I ever sounded even close to how dense this guy is. I just can’t even right now.
Drew, you’re being an idiot. Stop it.
[Ed. Note: Your mother asked me to give you this.]
Last time if Mr. Greenfield permits. I disagree, I’m not being an idiot. Based on the term Ultra Vires where one acts in non lawyer terms illegally why wouldn’t a landlord remove a non paying tenant and wait for the tenant to sue or not to sue? It’s not as if it does not happen all the time. So under the circumstance of what Mr. Greenfield states in the piece to my mind unambiguously saying the moratorium is not lawful why couldn’t a landlord use the same tactic?
I’ve taken my hits here deservedly from Mr. Greenfield; I don’t think in this case I deserve a knock
One good reason is it will get you locked up in NY and a lot of other states. Illegal evictions are a crime
I second this. I m a non-lawyer involved in a landlord-tenant issue. Landlords can not lock tentants out no matter what. They have o follow a process for evicition. Moreover, there are issues of landlord harassment and also invasion of privacy, trespassng, etc. Botton line: Landlords own the property, but in renting it, certain legalities apply. See state laws and in some caes, Federal laws. I’m in Conecticut, an have absorbed the state landlord-tenant laws to understand my position vis-a-vis a landlord.
PML is right that illegal evictions are a crime, but a host of other crimes can go along with landlord “self-help”: illegal conversion of property, assault and battery, burglary, criminal trespass, and more.
Some entry-level landlords think, while the holdover tenant is at work, they can go in, remove their stuff, dump it carelessly on the curb or in the trash, and then when the tenant comes home early and the landlord is still there and a physical altercation ensues, they aren’t at fault when they physically throw the tenant out after grabbing the keys from them because they own the building. They guessed wrong, and end up in prison.
About time.
What the papers don’t like to discuss is the normal path up and down the LL/T ladder. Some folks start in Manhattan, and end up in Jersey. Other folks start in jersey and end up in Manhattan. That constant shuffling is how the whole system operates.
The “housing is a human right” people don’t like to concede that reality. I’ve asked them (but they don’t answer) *which* housing, and *where*?
Within a 1-mile radius in a city you’ll find a huge price variation for housing, from a 1BRE luxury 1200-sf place on the 50th floor of a shiny new building in a rich area, to a 1BR 450sf basement with no AC, in an area you’d prefer to avoid. Expand the radius and the range expands as well. Eventually you have a whole ladder of options.
Normally, people self-transport up and down the ladder. Many folks are smart enough to move rather than get evicted, because they realize it’s better to take one voluntary rung down than to get tossed down farther against their will. Others won’t see that, and end up being evicted–but even then, they often end up somewhere, just not where they really want.
And crucially, those who move UP the ladder are always opening spots for those who move down. Or at least they were, until the world’s most idiotic moratorium went into place.
“another burden on the taxpayer”
No, it will not be a burden on the taxpayer. Do you not know how the magic money tree works? The government prints money and hands it out, and everything works out fine, until it doesn’t, but only a boring old white cis-hetero shitlord would ruin the party by talking about how it will inevitably end.
I suspect it will be a little from columns A, B, and C because this is an enormous problem and easy answers aren’t forthcoming.
I’ll add, I suspect my initial response is true because I have no reason to believe we, as a society, will embrace this crisis as an opportunity to change the prevailing trend around the privatization of profit and socialization of loss.
Landlords are business owners. Businesses come with the risk of loss. If America was truly capitalist the losers would lose and the market would soon be flooded with discount properties and absolute auctions. Then those of us who were fortunate enough to keep our jobs and saved our pennies through the pandemic would get our chance at the wheel.
Hate to harsh your socialist fantasies, Comrade Jake, but once the govt stuck its nose in with an eviction moratorium, it was no longer about the normal risks of business.
Dearest Miles, socialism is not the government doing things that impact the economy. Socialism has nothing to do with what Jake was trying to say or what our Host asked us to weigh in on. Yes, he shouldn’t have triggered you by saying the word “capitalism”, but you gotta stay out of shit you don’t understand well enough just like I shouldn’t get triggered every single time you rugged individuals utter “socialism” frivolously. I sincerely care about you not sounding so stupid. With only the kindest regards, PK.
Nonsense. This isn’t an earthquake or a flood. This is purely a politician-created disaster which could only ever occur in a socialist managed economy. If we had a capitalist system, there would have been no lockdowns and no eviction moratorium.
…or the banks in 08
If the United States of America were truly capitalist the government practice of handing out favors to one or another class of individuals would not exist, hence no boneheaded decision to put a moratorium on residential rental payments.
When the coin of the political realm is “Yeah, but what have you done for me today?” then whatever pure “ism” you want to attach to government is eventually compromised if not euthanized.
So, should we keep making the same mistakes, or let the market sort this out?
My money is on we keep making the same mistakes, much as I dislike your sophomoric attempt to guide this little discussion. As my father once put it, “Eventually most of us get exactly what we deserve.”
Your first comment is correct because it is so flexible. Yes, pain will be smeared around, falling on landlords, tennants, and everyone else, in different amounts. But this second comment is pretty baffling. If America were truly capitalist, there would be no eviction moratorium. Sure, landlords would have taken some losses (especially for the pricier properties) as people were forced to cheaper places by their reduced incomes. However, the eviction moratorium transferred a big part of the tennants’ collective income reduction onto the landlords. That is the reverse of “privatization of profit and socialization of loss”. A relatively small number of private entities were required to absorb the collective income losses of a much larger number of people. Furthermore the implementation of the scheme allowed some of the tennants to rip off the landlords, because there was no way to make sure that an individual tennant’s income reduction would have made the rent unaffordable.
“Tenants got to live in their apartments without fear of eviction for not paying rent. Some paid, honest fools that they are, but many didn’t. Some couldn’t. Many could. They just didn’t. They were still working, still earning a living, plus getting pandemic checks, and simply chose to put their money to more fun uses, as is the American way.”
I’ve been looking for a source which percentage of renters continued to pay, which could but didn’t, and which couldn’t and didn’t. Can anyone help? My searches have so far been fruitless.
You aren’t alone.
Who *should* take the hit is simple: mortgage lenders and other credit lenders. They are the most capable of absorbing the losses. And they still owe us for bailing their asses out in 2008. But we all know that ain’t gonna happen
Scott: Renters, Landlords or Taxpayers.
Bryan’s galaxy brain: MORTGAGE LENDERS!!!
Then credit becomes tighter, interest rates bump up, and the housing market suffers, so landlords can’t buy properties at good rates/new developments don’t happen, and they can’t afford to make necessary repairs or upgrades to housing on the market. Then there’s less housing, and existing housing is of lower quality. Or maybe the landlord absorbs the increased interest rates by bumping up rent on tenants.
At least the average home-owning taxpayer is not heavily affected by this option: the primary burden falls on the banks, who pass most of it to the landlords, who pass the majority of hardship from the burden down to the tenants. Considering that tenants now don’t want to pay back their rent, maybe it’s fairest that this is what happens.
A pandemic occurred that the government responded to by putting a lot of people, mostly renters, out of work. A lot of those people got, from the government, unemployment plus extra. A lot of people didn’t. The government also froze evictions.
Greenfield: wow who is at fault here i am so confused. Was it renters? I guess it was court cori bush because i apparently had no idea who she was till just now. I’m so informed and have such good opinions. People actually pay me for my brain.
I, for one, am shocked that you were incapable of reading and grasping anything about this post.
Shocked. SHOCKED!
Why wouldn’t you include the folks whose literal job is to mitigate the risk of defaults in the billions of dollars loans they are disbursing? That seems far preferable to kicking millions of people out of their homes, sinking millions of landlords and possibly leading to massive asset devaluation, or soaking the taxpayers yet again and encouraging moral hazard at an unprecedented scale while again letting lenders off the hook.
Only one of these groups could reasonably be expected to have been even remotely prepared for this, and it’s not any of the groups Scott mentioned. A plan that involves lenders restructuring or forgiving debt defaults genuinely caused by the economic disruption of COVID-19 would likely be the most reasonable and least economically destructive solution to the losses that have already occurred. Done well, the hit to ABF markets would be minimal. I’d even consider extending it to business on the whole whose only problem was being unable to open their doors, though I suspect most of those have already gone belly up, so the horse is out of the barn on them