The Renters and Rental Market Crisis Working Group
Convening researchers, advocates, industry experts, policymakers, and philanthropic organizations to share data and policy ideas and develop collaborative solutions that will stabilize renters and multifamily owners during the response to and recovery from the COVID-19 crisis.
The need. The COVID-19 public health crisis has caused widespread unemployment, especially for low-income workers who are predominantly renters.
Going into the crisis, many of America’s 44 million renters were more financially vulnerable than the 48 million homeowners with a mortgage, as a much higher share of renters’ monthly income goes toward their housing costs.
Federal, state, and local actors have taken important steps to prevent homelessness and evictions, but it is already clear that these short-term measures are insufficient to the scale of the crisis and its aftermath. Through no fault of their own, many out-of-work renters will not be able to make their rent payments in the coming months, even with the cash assistance provided through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. And less than a third of rental units are covered by eviction protection, leaving many renters at risk.
At the same time, eviction moratoriums or rent deferment programs that allow renters to temporarily stop paying rent shift the financial burden to property owners, many of whom will be unable to remain solvent if their collections drop significantly. If rent collections decline for several months, some property owners will be forced to address their liquidity issue by selling assets, putting additional pressure on the market by adding a considerable supply of for-sale single-family homes and multifamily properties and leading to further downward pressure in the real estate market. And when moratoriums are lifted, it is not clear what will happen to the millions of renters who may be accruing rent debt.
The result could trigger a ripple effect: tenants lose income and can’t pay rent, which means that property owners and landlords can’t cover operating costs and pay lenders and taxes. As a result, capital markets would tighten, lenders would stop lending, and the rental housing supply could shrink further. Left unabated, these dynamics could exacerbate an already dire crisis for renters.
Insights and information about how this crisis is unfolding on the ground for renters and landlords and in the capital markets is urgently needed to inform public policy and private practice. But the representatives of and advocates for distressed tenants and landlords and capital market players have few opportunities to build a common understanding and quickly forge widely acceptable solutions.
The goal. Initiated in March 2020, the Renters and Rental Market Crisis Working Group (RCWG) convenes public- and private-sector capital providers, rental housing owners, philanthropic organizations, tenant and civil rights advocates, and research and data analysts to regularly share what they are learning about evolving market dynamics and conditions for renters, owners, and rental markets nationwide.
The RCWG will inform the design and implementation of federal legislative or regulatory efforts as well as state and local policies to address the impending rental crisis by sharpening analysis of solutions with evidence and analysis.
The work. Urban experts, collaborating with other working group researchers and analysts, will collect and present the best current data to the RCWG. Specifically, we seek to create the following:
- a comprehensive understanding among all participants of the details and efficacy of the proposed federal legislative and regulatory solutions
- a comprehensive overview of state and local policy solutions (legislative, regulatory, or otherwise) that could be models for other jurisdictions or for federal activity
- increased understanding among all participants of the concerns, policy recommendations, and perspectives of the other working group members
- a vehicle to share information across sectors that allows rapid vetting and strengthening of policy options