FORBES: Camilo Maldonado,SeniorContributor – On Sunday, White House chief economic adviser Larry Kudlow said during a CNN interview that the federal government was planning to extend the eviction moratorium that expired earlier in the weekend. It remains to be seen when this supposed extension would go into effect or even if it will actually materialize, but millions of households could be affected.
On March 27, the CARES Act was signed into law and included a moratorium through July 24 on evictions for those living in homes funded by federally backed mortgages or who rely on housing vouchers. This protection covers roughly a third of renters and expires today, putting millions of families at risk of losing their homes in the middle of an unprecedented health and unemployment crisis.
Once the moratorium ends, landlords must still give renters 30 days’ notice before filing a complaint in court. Some states and cities have their own bans on evictions so renters should check with their local government if they receive notice.
Over 17 million Americans are still unemployed and unable to find work, and the number of confirmed COVID-19 cases only continues to rise. Removing families from their homes amid the surge in cases will result in even more lives being lost.
According to a report by The Center for Public Integrity, communities of colour are most at risk of losing their homes. This same group is also the most vulnerable to the disease because of structural conditions. One example is that Black and other people of color are more likely to be considered essential workers or work in jobs that can’t be done remotely. The disparities in the quality and access to healthcare for Black individuals have been widely documented as well. These factors mean that the expiration of the moratorium on evictions will disproportionately affect Black and brown communities, and widen the racial wealth gap.
According to the report, “low-income housing tends to be clustered in Black and brown neighborhoods, because centuries of discriminatory laws kept Blacks out of white communities by restricting where Black people could get a mortgage, and covenants that prohibited owners from selling or renting homes to non-whites.”
Aside from the obvious hardships that result from families being thrown into the streets, social and financial implications are just as devastating.
According to Princeton sociologist Matthew Desmond, evicted families regularly lose their jobs, lose their possessions, and have higher rates of depression. Children are not spared by the instability either. Worse outcomes in education, health, and future earnings are all linked to the uncertainty caused by eviction. The crippling effects of losing a home are long-lasting, even for the youngest groups affected.
Schools in Los Angeles and San Diego won’t reopen for in-person classes this fall, and other school districts are following suit. Evictions would result in children not only losing their homes but also their ‘classrooms’ and places of study. The loss of access to the internet and other basic services would again hit communities of color the hardest.
The Black Lives Matter movement has reached widespread support, with over two-thirds of U.S. adults supporting it. However, eviction perfectly highlights the systemic racism plaguing our country, and not extending eviction protections will only move our country backward. According to the ACLU, “women of color, and particularly Black women, are especially vulnerable to eviction for many reasons, including staggering pay disparities and wealth gaps.”
Between 2013 and 2019, average home prices increased by 47% while wages rose only 16%. The affordable housing shortage has caused countless families to be trapped in a vicious cycle where a seemingly good job is no longer able to cover basic necessities after a few years.
In July, 1-in-3 renters did not make a full on-time rent payment. The figures for homeowners were almost as high. As mass evictions are poised to ravage communities throughout the US, there are calls for the federal government to step up and renew the moratorium.
Some bills have been proposed by House Democrats, which include forgiving or canceling rent payments. These proposals put the onus of seeking assistance on the landlords and not tenants, which would increase the number of individuals who would be protected since many Americans weren’t aware of the existing moratorium.
The $600 unemployment supplement is set to expire at the end of the month, exacerbating an already desperate situation. The GOP-led Senate is expected to introduce another stimulus bill early next week and to formally begin negotiations with Democrats to craft a new piece of legislation. As it stands, the GOP’s current framework focuses on additional direct payments, more PPP loans, expanded unemployment benefits, liability protections, and funding for schools to reopen. If eviction and housing protections are not included in a final bill, a catastrophic wave of evictions and homelessness will shatter countless communities and lives. Adequate housing is a fundamental human right, and as a nation, we have lost sight of that.
Camilo Maldonado is CEO of the personal finance company The Finance Twins. He holds an M.B.A. from Harvard Business School and a B.S. in Finance from the Wharton School