The eviction moratorium has kept struggling renters housed during the pandemic. But what will happen when landlords are able to resume evictions for non-payment of rent after June 2021?

According to the U.S. Census Bureau Household Pulse Survey, during March 17 – March 29, 2021 in California:

  • 16% of households were behind on rent payments;
  • 6% of households felt they were very likely to be evicted from their current housing in the next two months;
  • 22% of households felt they were somewhat likely to be evicted from their current housing in the next two months;
  • 14% of households had no confidence in their ability to make next month’s rental payment; and
  • 11% of households had only a slight confidence in their ability to make next month’s rental payment.

With roughly one-in-four renters lacking confidence in their ability to pay next month’s rent and one-in-three believing they may be evicted in the coming months, the stability of the rental market is rapidly crumbling.

When the moratorium ends, the evictions will begin

The eviction moratorium is currently scheduled to expire on June 30, 2021. Without further extensions of the moratorium, many renters will soon find themselves homeless.

As revealed in the Census survey, some renters are simply unsure about whether they will have housing in the coming months. The three main sources contributing to eviction uncertainty are:

  • federal and local government policies;
  • the course of the economic recovery; and
  • individual landlord discretion.

With government policies, the question remains whether the administration will extend the moratorium. In the event it gets extended (for the fourth time) on a federal level, the question then becomes: for how long?

In California, the governor signed Senate Bill (SB) 91 into law early this year, extending the statewide eviction moratorium to June 2021 and providing assistance for landlords with $2.6 billion in federal stimulus funds.

For the economic category, the deciding factor is when jobs will return for renters. Without a reliable source of income, tenants cannot pay. The lack of renter confidence stems from the 1.7 million Californians still jobless — and millions more nationwide — as a result of the 2020 recession.

Finally, when the moratorium is up, it’s entirely up to landlords to choose how to respond. They may evict the tenant and demand repayment of rent (unlikely to be successful with a jobless tenant), or they may choose to work with tenants to find mutually beneficial solutions, such as setting up repayment plans. In California, SB 91 assists landlords who agree to waive 20% of unpaid rent for income-qualifying tenants by reimbursing 80% of the unpaid rent owed between April 1, 2020 and March 31, 2021. This program is a positive step in helping landlords keep tenants housed and continue to cover costs, but it is not a full solution.

As the expiration of the eviction moratorium looms closer for renters who do not qualify or whose landlords choose not to participate in the program, so too does the threat of eviction. Whether landlords and tenants will work out payment plans for back-rent owed or whether landlords will evict from missed payments remains unknown. Either way, expect to see evictions — and vacancies — rise following the moratorium’s expiration.

Although some categories leading to eviction remain murky, one thing is clear: renters regaining access to jobs is imperative for these renters to maintain payments and, on a broader scale, for the real estate market to recover.

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