COVID-19 ISO Insights

COVID-19 Crisis Evictions May Surge

November 9, 2020

By: Christopher Sirota, CPCU

Back in July 2020, we posted about the Princeton University Eviction Lab's forecast that 20-28 million people in the U.S. faced evictions between July and September 2020. We also noted that getting evicted can have repercussions on a person's life beyond losing a place to live, including potentially increasing poor health outcomes, increasing mortality, causing respiratory distress, and potentially contributing to depression and suicide.

Subsequently, in an attempt to mitigate evictions during the pandemic crisis, Bloomberg has reported that after the Federal CARES Act moratorium on evictions expired in July 2020, the Centers for Disease Control and Prevention (CDC) issued an order to temporarily ban some types of evictions. The CDC order explains, in part, that:

Under this Order, a landlord, owner of a residential property, or other person with a legal right to pursue eviction or possessory action, shall not evict any covered person from any residential property in any jurisdiction to which this Order applies during the effective period of the Order.

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. Eviction moratoria facilitate self-isolation by people who become ill or who are at risk for severe illness from COVID-19 due to an underlying medical condition.

The order is effective from September 4 to December 31, 2020.

Per a September 22, 2020 article by the Eviction Lab, eviction data indicates that since the issuance of the CDC order, eviction filings have decreased but not ceased completely.

But does the CDC order have the authority? According to Bloomberg, there has been a lawsuit in U.S. District Court for the Northern District of Georgia against the moratorium. According to one expert, the CDC order was issued, in part, based on the authority to "stop the spread of contagious disease across state lines."

If an injunction is issued, then, according to the article, the following statistics may provide an order of magnitude of the number of potential evictions that could occur in the near future:

  • In September 2020, over 6 million households missed a mortgage or a rent payment
  • Of 11 million renters, "one in six adult tenants" were behind in payment
  • The number of people categorized as living in poverty increased by about 8 million people since the first stimulus package ended

The article provided several examples of lawsuits that were dropped because the landlords seeking to dispute the CDC order found other avenues to potentially pursue their eviction proceedings.

A related October 29, 2020 article in the Wall Street Journal noted that some experts now estimate that between 30 to 40 million people could face evictions after moratoriums are lifted.

The Journal added the following estimates that highlight the gravity of the situation:

  • Experts project rent debt to range from $7.2 to $70 billion by the end of 2020 if there is no stimulus spending.
  • 12.8 million people in the U.S. will likely owe an average of $5,400 because of missed rental payments.
  • "Credit payments to small and medium-size businesses connected to rental real estate increased by more than 70% in the spring, according to the Philadelphia Federal Reserve. The data showed that through the fall these payments have remained some 50% higher than during the same period in 2019."

Possibly adding to a person's financial stress, per the article, are missed payments and other negative information that may be reported when a person's credit score is generated; this may worsen that individual’s ability "to secure new housing accommodations, and future landlords could require a higher security deposit or advance rent payments."

How Might an Increase in Evictions Affect the Spread of COVID-19?

It may not jump out as immediately evident, but since evictions typically alter where people live, this displacement could exacerbate the spread of COVID-19. Bloomberg noted that one expert developed a model which "predicts that a 1% eviction rate would result in a 5% to 10% higher incidence of infection, leading to approximately 1 death for every 60 evictions."

Evictions Despite Moratoriums?

According to an October 2020 report from NPR, the Eviction Lab estimates that 120,000 people may have been evicted, even though there have been both state and federal moratoriums during the crisis.