Urban Wire Emergency Rental Assistance Is Not Reaching Tenants with the Lowest Incomes Fast Enough
Daniel Pang, Jung Hyun Choi, Laurie Goodman
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Maria Martinez with her son Ricardo Martinez, right, talk to Roberto Garcia-Ceballos, reflected in the doorway, at the Tokio Hotel on Monday, Oct. 4, 2021.

Tenants with low incomes struggled to pay their rent on time even before the COVID-19 pandemic, and we have observed concerning trends in our most recent data. According to our rental payment tracker on mom-and-pop landlords, the share of rental payments made by renters with the lowest 20 percent of rent costs, who represent renters with low incomes, has steadily dropped from a pandemic high of 85.7 percent in April 2021 to 79.8 percent in November 2021 and has not recovered since. This trend suggests that despite the increased speed of Emergency Rental Assistance (ERA) distribution, the funding may not be reaching renter households with low incomes quickly enough.

Avail, an online platform that provides rental management tools for do-it-yourself landlords and their renters, surveyed 2,038 tenants nationwide in January 2022, with about two-thirds of these renters living in properties with no more than four units. From these survey results, we can better understand the struggles renters with low incomes are facing and the consequences of missed payments, and we can propose short- and long-term recommendations to support these renters.

Renters with low incomes are more likely to miss multiple rental payments

Over the past year, renters with low incomes have struggled significantly more than renters with high incomes. Renters with incomes between $25,000 and $49,999 a year have a payment rate of 80.5 percent, but renters who earned less have struggled even more, with 73.9 percent of those earning $10,000 to $24,999 a year paying their rent on time every month and only 64.0 percent of those earning less than $10,000 doing so.

For many of these renters with low incomes, these struggles to pay were compounded over multiple months. Among renters who earned less than $10,000, 16.5 percent missed three or more months of payments over the last year compared with 6.3 percent of renters earning between $25,000 and $50,000 and less than 1 percent with incomes more than $75,000.

Bar chart showing that renters with low incomes are more likely to miss multiple months of payments

ERA funding is not reaching renters with low incomes quickly

Previously, we found that renters behind on payments were less likely to know about the ERA program. Now that the program has progressed, we find that renters who were behind on rental payments and renters with low incomes are more likely to know about the program than those with higher incomes. The higher awareness stems from households with low incomes being more likely to be behind on rent, not necessarily because they have better access to information. About 75 percent of renters who missed a rental payment earned below $50,000.

In general, tenants’ awareness of ERA has increased. In February 2021, only 31.2 percent of tenants were aware of the program, but by May 2021, 43.6 percent were aware. In the most recent survey, conducted in January 2022, 51.8 percent of tenants were aware of ERA. In the most recent survey, the awareness was higher among those who missed a rental payment (64.0 percent) than those who did not (49.2 percent). 

Bar chart showing that renters who missed rental payments were more likely to be aware of Emergency Rental Assistance

The survey results also show that ERA funding is not being distributed as quickly as it needs to be, especially for renters with low incomes. For renters earning less than $50,000 who have applied for ERA, 57.7 percent have received funding compared with 66.7 percent of those who earn more than $50,000. Overall, about 59.0 percent of renters have received ERA funding after applying.

Renters with low incomes were more likely to be encouraged by landlords to vacate property

Eviction proceedings can create additional tension between landlords and tenants. Although federal, state, and local eviction moratoriums have reduced the number of evictions during the pandemic, landlords have used other methods to vacate their tenants, including refusal to renew an existing lease, mutual termination of a lease, housing mediation, and cash for keys.

Survey results show that a significantly higher share of renters with low incomes faced pressure from a landlord to vacate their residence over the past year compared with renters with higher incomes. Over a third of renters earning up to $9,999 and a quarter of renters earning between $10,000 and $24,999 faced pressure to vacate the property. Among renters who missed a payment, nearly half of those earning below $25,000 and a third of those earning between $25,000 to $74,999 faced pressure to vacate the property, compared with around 22 percent of those earning over $75,000.

Bar chart showing that landlords were more likely to encourage renters with low incomes to vacate properties

When screening tenants, landlords put a lot of weight on eviction history and past rental payments, making it increasingly difficult for renters with past evictions or rent delinquencies to find housing in an already tight market. Even renters who have not been evicted but have been forced to move by other methods are more likely to face much higher rental payments.

Solutions to increase housing stability for renters with low incomes are needed

Faster distribution of ERA funding to renters with low incomes could help them stay housed amid a more competitive rental market. Although the US Treasury has adjusted the ERA application to make it easier (PDF), many renters with low incomes are still waiting for funding. The slow delivery of ERA payments poses a large risk as both the landlord and tenant surveys show that most landlords and tenants report that it takes only one or two months of missed payments for landlords to trigger an eviction. With the share of tenants with low incomes who have missed recent rental payments climbing and landlords’ increased sensitivity to past eviction records , it is critical to allocate funding to the tenants as fast as possible.

In the long run, expanding housing choice vouchers can increase housing stability among renters with low incomes. Our previous research finds that housing vouchers have helped tenants and landlords weather the pandemic, as tenants with vouchers were less likely to owe back rent and landlords were largely satisfied with renting to tenants with vouchers. But existing federal aid serves only about one in five of those who qualify. Policymakers can also streamline regulations to make it easier for landlords to accept voucher holders. 

Ultimately, these survey results show that renters with low incomes will need more assistance in the coming months amid a competitive rental market and increasing rents.


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Research Areas Housing finance
Tags Housing finance reform Rental housing
Policy Centers Housing Finance Policy Center
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