The White House issued an order Tuesday through the Centers for Disease Control and Prevention that declared evictions during a pandemic a national health hazard, protecting U.S. renters from losing their homes during the COVID-19 pandemic.
The CDC’s moratorium will apply to all rental units nationwide until Dec. 31 and goes into effect immediately, senior administration officials said of an unpublished CDC agency order. Treasury Secretary Steven Mnuchin told a U.S. House of Representatives panel Tuesday that the moratorium would cover around 40 million renters.
While tenant advocates applauded the eviction action, most said the administration’s move lacked the necessary financial relief for both tenants and landlords to keep them all from falling further into debt.
“The CDC order is really quite extraordinary, but if it’s not coupled with rental assistance, it’s just pushing the issue down the line and it will snowball into a crisis that landlords and tenants will be recovering from for decades,” said Emily Benfer, a law professor at Wake Forest University and co-creator of the COVID-19 Housing Policy Scorecard with the Eviction Lab at Princeton University.
“We need $100 billion to cover this deficit and that investment is far less expensive than the cost of eviction, the cost of homelessness — all of the downward effects that this causes,” Benfer said.
A previous federal eviction moratorium created by the CARES Act ended in late July and only applied to federally-funded housing, including rental units with mortgages backed by Fannie Mae and Freddie Mac. The moratorium will apply to any state in which there is not already a more protective ban in effect, according to the order. Multiple states have eviction moratoriums in place, including California, which established new rules in a late-night vote Monday.
Renters will be eligible for the moratorium’s protection if they received an economic impact payment, or stimulus check, as provided for by the CARES Act. Therefore, single renters must earn no more than $99,000 a year, while couples filing jointly can earn up to $198,000 annually.
The order, which was shared ahead of being published in the Federal Register on Sept. 4, includes a declaration for renters to sign and give their landlord. Senior Trump administration officials said the form would be made available on the CDC’s website.
Renters must indicate on the declaration that they cannot afford to pay their rent in full and that if evicted they would become homeless or force to move into congregate housing. Renters also must be able to prove that they made an effort to receive government assistance and that they could not afford rent.
The moratorium does not absolve renters of paying the rent. That money is still due to landlords, and senior administration officials said that renters should still attempt to make partial payments when they cannot afford to pay in full.
Landlords will still be permitted to evict tenants in certain cases, such as instances in which the tenant has destroyed property or poses a threat to the health or safety of neighbors.
“In the context of a pandemic, eviction moratoria — like quarantine, isolation, and social distancing — can be an effective public health measure utilized to prevent the spread of communicable disease,” the CDC’s unpublished order said.
“President Trump is committed to helping hardworking Americans stay in their homes and combating the spread of the coronavirus,” White House deputy press secretary Brian Morgenstern said during a briefing Tuesday.
Housing advocates said the move was “long overdue,” but called for more help to be provided to renters facing financial difficulties amid historically high levels of unemployment caused by the pandemic.
“As we have said for five months, the very least the federal government ought to do is assure each of us that we won’t lose our homes in the middle of a global pandemic: The administration’s action would do so and will provide relief from the growing threat of eviction for millions of anxious families,” said Diane Yentel, president and CEO of the National Low Income Housing Coalition.
The multifamily housing sector has, until now, been something of a safe haven for commercial real estate investors. Housing has been the only real bright spot throughout the pandemic. Some investors have moved out of the beleaguered office and retail sectors and moved into multifamily.
“I believe that this new regulation — and even greater eviction crisis that we will be seeing come 2021 — will cause a significant decline in multifamily values,” Denchfield said.
It could also lower the value of single-family homes, as small landlords default on their mortgages and those homes go into foreclosure.