Hundreds of thousands of renting families might have to sleep rough after the nation’s highest court prevented a temporary prohibition on eviction, on Aug. 26.
Investment bank Goldman Sachs predicts as many as 750,000 tenants and their families will be forced onto the street, if they keep failing to meet financial obligations to landlords.
Goldman Sachs analysts revealed renters across the nation are between $12 billion and $17 billion in arrears. This suggests about 2.5 million to 3.5 million households are behind in rent payments, according to Politico.
The revelation came after the U.S. Supreme Court blocked the Centers for Disease Control and Prevention’s (CDC’s) proposed federal moratorium on evictions until Oct. 3, 2021. The extended measure was intended to help struggling Americans survive until state emergency rental assistance arrives.
CDC’s actions sparked controversy over the high level of authority the Biden administration gave the federal agency. A group of lawyers successfully argued such an extension requires new legislation. A public agency without executive authority cannot act before this requirement is met.
“If a federally imposed moratorium on evictions is to continue, Congress must specifically authorize it,” the court ruled in favor of landlords in a six to three vote.
Thousands of homeowners welcomed the decision, especially those experiencing delayed payments due the pandemic. Landlords were neither able to evict non-paying tenants nor sell the properties in question for badly needed cash.
Fox News blames inflation for causing home prices and rental rates to reach unsustainable levels. At this price point many residents cannot afford to meet financial obligations, if they lose income due to government restrictions to help contain the Chinese Communist Party virus.
The National Multifamily Housing Council (NHMC) stressed the federal moratorium was never a long-term solution to housing affordability woes.
“It does nothing to speed the delivery of real solutions for America’s renters and ignores the unsustainable, and unfair economic burden placed on millions of housing providers,” an NMHC representative said in a statement. “[This is] jeopardizing their financial stability and threatening the loss of affordable housing stock nationwide.”
The Biden administration’s 2020 pandemic relief package established the Emergency Rental Assistance (ERA) program, which made available $25 billion in funds earmarked for housing debt repayment. The American Recovery Plan Act in March 2021 provided a further $21.5 billion in rental assistance in what is known as ERA2.
However, these funds are slowly reaching the needy due to extensive application processing delays. The U.S. Treasury Department reported that state and local programs had only spent $5.1 billion of the total $25 billion ERA as of July 31.