As many Americans return to their offices for work and large-scale events again being scheduled for the summer, a potential housing crisis looms over the nation’s post-pandemic recovery celebrations. Researchers estimate that at least 4.2 million Americans could lose their homes in the next two months, due to eviction or foreclosure, with cumulative back payments totaling up to $34 billion. Without federal intervention, 30 million to 40 million renters could become homeless by the end of 2021.
The situation is equally concerning in North Carolina.
According to a recent analysis by the U.S. Census Bureau Pulse Survey, more than 200,000 renter households in NC are behind on rent. The National Council of State Housing Agencies estimates the count to be even higher in a recent report, with at least 300,000 households in the state behind on rent. From U.S. Census Bureau survey data in May’s National Equity Atlas, North Carolinians are behind on rent with an average debt of $2,700. Many households report both rent/mortgage payment delinquency, as well as additional debt from multiple delinquent utility payments. "Even as the U.S. economy continues to recover, the inequalities amplified by the COVID-19 pandemic remain front and center," the researchers wrote in the Census Bureau report.
According to another housing report released June 16 by researchers at the Harvard Joint Center for Housing Studies, a disproportionately large share of those facing evictions or foreclosures are low-income or people of color, exacerbating existing inequalities in housing prior to the pandemic. The Harvard Report also revealed racial disparities among renter households behind on rent payments as follows: 29% of Black, 21% of Hispanic and 18% of Asian compared with just 11% of white renters. The Harvard Report also stated that 2.3 million American homeowners were in active forbearance in early 2021, and that those in these circumstances were more likely to be households of color and/or have little equity in their homes.
With so many North Carolinians at risk of becoming homeless, N.C. Gov. Roy Cooper extended the COVID-19 State of Emergency in the state on June 11 with Executive Order 220 for an additional 30 days, an extension of the Eviction Moratorium through July 30, 2021. While the additional time is necessary for many to seek relief funding or make plans to relocate, the extension does come with a mixed bag of outcomes. Eventually, the State of Emergency will be lifted, likely on August 1, and at that time, all the back rent will become due, leaving many renters unable to pay. The substantial federal relief through expanded unemployment benefits, federal and state eviction moratoriums and stimulus payments have prevented widespread evictions, but those programs have ended or will close soon. As the moratorium expires before COVID vaccination rates increase in marginalized communities, evictions could lead to a rise in the spread of the virus and potentially deaths. Princeton University's Eviction Lab study, released June 2021, concluded that neighborhoods with the highest eviction filing rates have the lowest levels of COVID-19 vaccinations.
In May, North Carolina’s application period for the statewide assistance program for COVID relief funds was reopened and Gov. Cooper has urged North Carolina residents behind on rent because of the COVID-19 pandemic to take advantage of the available funds. The Housing Opportunities and Prevention of Evictions (HOPE) program provides rental and utility assistance to residents of 88 of North Carolina’s 100 counties. Residents of all 100 counties can apply at hope.nc.gov or by calling 888-ASK-HOPE (888-927-5467). Registered members of a tribe coordinating their own assistance programs are encouraged to also call the number listed above and they will be directed to the correct jurisdiction.
During the first round of funding, in NC, the HOPE Program received 40,000 applications in three weeks last October, and ultimately awarded 56,000 awards to 36,000 families, totaling about $133 million in rental and utility assistance. The first round of the HOPE Program covered about six months of payments. The second phase of the HOPE program features several improvements, including more robust funding that will cover up to 12 months of assistance for payment of nine months of arrears and three months of rent. Once a recipient reaches three months of rental assistance, they are eligible to reapply, if needed.
While housing advocates confirm that government relief efforts have kept many individuals and families housed during the public health emergency, additional swift actions are required to address both the housing stability and affordability issues nationwide. President Biden’s American Rescue Plan (ARP) funding provides a two-pronged approach to housing issues, but timing will be key. The ARP includes $27.4 billion for rental assistance, $5 billion for housing vouchers, $5 billion in homeless assistance, $10 billion to help homeowners avoid foreclosure and $5 billion for utility assistance. As the moratorium ends, for those facing eviction it’s a question of how quickly the funds will be distributed.
The ultimate solution lies in providing speedy housing stability support, while also innovating housing policy with longer term resource solutions. The National Low Income Housing Coalition (NLIHC) reports that $36,751 is the annual income needed to afford two-bedroom housing in North Carolina. Currently, 70% of N.C. renters with very low incomes spend 50% or more of their earnings on housing costs. Nationwide, more than 11 million families on the lowest income rung face an estimated shortage of 7 million affordable homes, and about one in four renters spend more than half their incomes on housing.
Job-training funding and an increase to the minimum wage will contribute to long-term housing stability, where renters can pay their rent and stay in their homes. As a potential ‘once in a lifetime opportunity’ presents itself with the ARP’s proposed investments in housing at historic levels, advocacy and even activism in housing policy can be construed as a social justice issue. The HUD budget levels in the White House budget proposal for infrastructure are nothing less than unprecedented in modern times - $318 billion in housing investments: with expansion of the low-income tax credit, national housing trust fund, rental assistance and housing development grant funding, plus a 15% increase in HUD Housing Choice voucher program, the largest in its history. With housing affordability at crisis levels pre-pandemic, ending the ongoing housing crisis will require broad policy action, not just temporary relief. Bold, innovative policy action now, in conjunction with emergency relief funding, may ensure the most dramatic paradigm shift, where all Americans support each other in having opportunities to live fully, with enough to eat and a roof over their heads.
Interested in housing policy and want to make a difference? How can you get involved? NC Community Action Association is chartering a Housing Think Tank initiative to consider these issues and propose multi-faceted solutions such as addressing systems, infrastructure and policy. Is this an area of expertise for you? Would you like to be a part of this developing conversation? Initial meetings will be held in August 2021 with virtual participation, making attendance from anywhere in the state feasible. For additional information, contact Elle Evans Peterson.