Pandemic Programs to Help Renters Less Effective in Southeast
May 21, 2024
Two federal policies intended to reduce housing instability fueled by the COVID-19 pandemic provided less stabilization to renter households in the Southeast than in other areas of the country, according to an analysis by the Federal Reserve Bank of Atlanta.
The policies included a federal moratorium on eviction for nonpayment of rent and Emergency Rental Assistance funds (ERA), a two-part, $46.55 billion allocation for eligible households to cover rent payments and arrears, utilities and home energy costs and arrears, and certain other expenses related to housing, according to the Treasury Department, which administered the programs. The Fed analysis found that the moratorium was less effective in the Southeast than in other areas of the country and that distribution of ERA funds was delayed or not fully deployed in some parts of the Southeast.
A discussion paper by Atlanta Fed senior adviser Sarah Stein, senior research analyst Pearse Haley, and research analyst Grace Meagher, "Sheltering in Place? A Closer Look at Pandemic Rental Instability in Six Southeastern States," suggests that the programs' effectiveness "varied greatly by geography and relied upon their efficient implementation, a consistent return of jobs, and stable rent prices." In the Southeast, the authors said, "expectations underlying the rental stabilization plan did not align with the unpredictable pandemic climate."
"Access to stable housing is a fundamental need for every household, and our prior research has shown that that access is particularly constrained in many places across our District—especially for people making less than half of their area's median income," Stein said.
Senior adviser Sarah Stein joins the Economy Matters podcast for a conversation about rental instability in the Southeast
The paper's release results from the Atlanta Fed's multiyear analysis of housing assistance programs and economic conditions that affected low- and moderate-income households during and following the COVID-19 pandemic. The study—which noted that southern states had the highest share of renters in arrears and experienced the highest income losses related to COVID-19—is the first to focus on the federal pandemic rental housing stability programs' effectiveness in the Southeast.
"At the onset of the pandemic, so many things seemed deeply uncertain: Would it be safe to go to work? Whose jobs would be able to continue? What did it mean to shelter in place? These concerns quickly pointed to renter households as particularly vulnerable to job loss," Stein said. "Since many low- to moderate-income households have a very thin savings buffer and many states in our District have relatively low-barrier eviction procedures, deep concern arose that these economic shocks could result in housing loss."
The authors added two criteria to their review of the moratorium and ERA, analyzing employment loss and recovery. With these additional aspects, they gleaned insight "into how job loss may have amplified housing instability in southeastern geographies. In doing so, we seek to add this regional context to existing work that has assessed job loss and renter distress at a national level."
The analysis is limited by data on housing and unemployment that are inherently incomplete. The proportion of renters who may have vacated a dwelling voluntarily for fear of eviction for nonpayment by landlords who did not notify tenants of the federal moratorium—or because landlords may have illegally changed door locks—is unknown, and data on unemployment insurance is unavailable below the state level. Employment data focus on 2020, the first year of the pandemic, and rental data range from 2020 through 2022.
The authors said year-over-year rent increases in the Southeast were among the nation's largest, citing data from Harvard University's Joint Center for Housing Studies' State of the Nation's Housing 2022. More recent changes in the South are now split, according to the center's 2023 report: rents in some areas of the South were among the fastest growing in the third quarter of 2023, while other areas experienced rent declines.