Lambert here: Boy howdy, that $2000 from Joe Biden sure did come in handy! That was a month’s rent!
By The Texas Tribune. Cross-posted from Alternet.
Texans behind on their rent are at increasing risk of losing their homes despite a federal moratorium on evictions, according to housing attorneys, because a Texas Supreme Court order aimed at forestalling evictions has expired.
The nationwide order from the Centers for Disease Control and Prevention halting evictions through June 30 — originally issued under the Trump administration — has been an important bulwark against a housing crisis as people lost jobs and income during the pandemic, housing advocates say.
But an emergency order issued by the Texas Supreme Court that instructed judges across Texas how to follow the federal mandate expired March 31.
Without the explicit backup of the moratorium from the state’s highest civil court, Texas landlords could resume pursuing evictions of people affected by the pandemic, housing advocates said, and it could fall to the federal government to enforce the CDC order.
“A lot of people have been saying for the last year that this eviction wave is coming and that we are about to step off this cliff into the abyss. With this latest news, we just stepped off that cliff. This is the worst case scenario,” said Mark Melton, an attorney who has helped hundreds of Dallas-area tenants during the pandemic. “This basically says that if a landlord wants to risk federal prosecution, that’s their business, not our problem. And if they want the eviction we have to grant it under state law.”
The Texas Justice Court Training Center, which trains judges and issues procedural guidance, has updated its eviction-related guidelines to say that Texas courts can proceed with eviction cases, although “the landlord might choose to place this case on hold.”
“This just means that the courts in Texas would follow Texas procedure in law, which doesn’t have anything in it about the CDC moratorium. Now there could be local laws that would maybe have a moratorium,” said Theadora Wallen, the training center’s executive director.
To be protected by the CDC order, renters must sign a declaration stating they risk homelessness due to effects of the pandemic, among other requirements. The CDC order subjects violators to fines up to $100,000 and a year in jail. The penalties are steeper if violating the order results in death. Until March 31, justices of the peace in Texas played a key role enforcing it, halting eviction proceedings they believed violated the CDC order. Now it will be up to individual judges to decide whether to follow the federal orders.
Meanwhile, a Texas program meant to financially help renters who have fallen behind has barely taken root.
“In essence, the Texas Supreme Court and the state’s leaders are abdicating their powers and moral obligation to protect renters from homelessness. Meanwhile, the $1.3 billion state-run rental assistance program has stumbled. As of less than two weeks ago, fewer than 130 payments had been made,” said Christina Rosales, deputy director of the advocacy group Texas Housers, in a statement. “Program administrators, who had aimed to process applications within 14 days, say that 60 days is closer to average. If landlords are able to evict tenants who have applied for rent relief, the program will fail before it has had the chance to succeed.”
According to Kristina Tirloni, spokesperson for the Texas Department of Housing and Community Affairs, as of April 2 the program had provided $2.3 million in rent relief for 358 households. But when TDHCA announced the program in February — tapping federal funds — the agency said it hoped to help around 80,000 households.
“Texas received more than $1 billion to start this first-time statewide rent program from scratch, with little to no federal guidance,” Tirloni said. “The system will ramp up considerably in the coming days and weeks, and we are preparing to administer another round of funding, approximately $1 billion more, very soon.”
The slow deployment of assistance hasn’t been a problem just in Texas. The Texas Tribune reached out to agencies in the six biggest states, and all have experienced similar delays. Some, like Florida, have not even opened the application process.
For Texans who have lost income, the delays are feeding stress and uncertainty. According to a survey by the U.S. Census Bureau released in March, around 1.5 million households in Texas have slight or no confidence in their ability to pay next month’s rent. The problem is most common among Black and Hispanic households. That’s the case for Nini Maldonado, a mother of five in Katy, who has applied to city and state rent relief programs with no success.
“We would call the customer service hotline and no one would pick up,” Maldonado said in Spanish. “We would be waiting for an hour and then the call would drop. We never managed to get help to fill up the forms.”
Maldonado works in a restaurant, and her husband is in construction. During the last year, both lost hours of work and sometimes were unemployed. On top of that, the couple contracted COVID-19, leaving them out of work in December. Right now, she owes two and a half months’ rent, and although their landlord is open to a payment plan, he has also said he is ready to proceed with their eviction.
“He told us that if by April 3 we haven’t paid rent plus $200 [of the amount owed], he is going to court,” Maldonado said. “My husband is a calm person, he tries to stay positive. But I do feel this very hard on myself, I think about where we will go with the five kids if they throw us out.”
Landlords — many also struggling to pay for mortgages and maintenance — also complain about the slow and cumbersome access to rent relief. David Mintz, vice president of government affairs at the Texas Apartment Association, said rent relief is key, and he expects the program to speed up.
“While the Texas Apartment Association opposes the CDC order, so long as it remains in effect we will continue to educate rental property owners about complying with its provisions,” Mintz said. “The real focus needs to be on ensuring the Texas Rent Relief Program, the Texas Eviction Diversion Program and similar programs in local communities are running efficiently.”
Nelson Mock, a housing attorney for Texas RioGrande Legal Aid, said that the organization’s immediate concern is eviction cases that were already in the legal pipeline before they were halted, when the judge had already instructed a constable to proceed with the eviction.
“If a tenant is at the end of the process, where the judgment is final and a writ is allowed, then the tenant is given 24-hour notice and removed,” said Mock, who has heard of many evictions that were stopped at the last minute. “Once that pause is lifted, once that abatement is lifted, they will get this almost immediate removal from their homes.”
Given the lack of protection for tenants in the state’s new guidelines, having legal advice could be key for people risking eviction, but in Texas most of them appear in courts on their own. Many avoid court altogether. Mock said that many attorneys and advocates are asking the Texas Justice Court Training Center to change its recommendations and, in the meantime, are advising tenants to be proactive and seek legal aid.
“Anyone who has the protections of the CDC order should be urging the courts to follow the CDC order,” Mock said. “To the extent that they have a landlord who is not following the order, there is a help line, a complaint line that the [Consumer Financial Protection Bureau] has set up. Tenants should be reporting these problems.”
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Texas Courts Open Eviction Floodgates: ‘We Just Stepped Off A Cliff’
Private Equity and Hedge Funds are salivating in the wings.
I am sympathetic to working people whose financial situation during Covid — now endemic — doesn’t leave enough money to pay rent. It is tragic and difficult, but that is how life can be.
I am also sympathetic to those who invested in housing as a way to earn an income — and not all of them are particularly wealthy, like Blackrock or Berkshire Hathaway billionaires, who have bought up much of the desirable rental property. I know someone who bought a few houses from a broker during the 2008 downturn, does most of his own repair and maintenance work, and looked forward to an extra income stream from this to help with retirement, which he is already old enough to do, but hasn’t yet.
One of his renters hasn’t made any payments for over a year, and he is out well over 20 grand, so far, and he still has to make payments on the house. It is not fair to him that he has to subsidize this renter. What gives the CDC the right to force my friend, or anyone else, to do this? Is it even legal, or just more power grabbed by a government agency that couldn’t even produce reliable Covid-19 tests, or still can’t make consistent, science-based policy about masks, vaccines, etc.
There are renters who will game this situation to get free rent. For example, the renter in question tried to claim bankruptcy, but after looking at her overall financial situation, the judge denied bankruptcy status. Yet, the renter can continue to live for free in a home provided by my friend.
Please don’t misunderstand, I am sympathetic to the plight of people without work or income due to Covid and other misfortunes such as medical bankruptcy. However, the eviction moratorium doesn’t put the costs where they belong, which is on society in general, not on responsible individuals like my friend who saved and invested to be able to weather such a storm.
My friend will make it through this, though somewhat poorer. He now feels bitter about having to carry the costs for other people simply because he chose to rent out a few homes instead of putting it all in the Stock Market Casino, or getting almost zero interest on savings.
This experience has caused him to shift quite a bit to the right politically, and for me, somewhat to the right. It is also apparent that government at all levels are using their powers to keep from having to pay to help people in need.
Floodgates may indeed be opening. This can can’t be kicked down the road forever.
Sorry but buying rental houses was a speculative endeavor for your friend and he did it to make more money with less risk in his eyes than the stock market which is justifiable. Also haven’t asset prices continued to rise? He’d be selling into a higher market with lots of buyers and as you say he could already retire anyway so this tale of woe isn’t all that bad considering the circumstances, and they still owe him the money, they just haven’t paid…it’s a moratorium not forgiveness. I don’t see the loss here, just not a profit. The can got kicked to now, when summer is approaching and people love to go camping. It’ll be fun. For his renters, IMO there will be no more stimulus, no more breaks, work or die just like before, but worse.
That’s righr- the LL isn’t ‘out’ anything. Also, while this is probably a legit, good faith post, but it’s a nearly peffectly balanced hybrid oc thr standard talking points / model letter of comment from the apartment owners’ / landlords’ associations on the topic with a couple of small scale appeals (sops, really) to target NK audience. So well done I was initially suspicious. :-)
IMOR, tegnost
What? I have nothing to do with any such real estate association, but you imply that I might. My late 60’s, blue collar friend and hiking buddy has to keep working because SS won’t pay all the costs for his “middle class” lifestyle. The homes return 10% or less after all costs, not including his time. They are not expensive, fancy homes in nice neighborhoods, just ones he could afford due to the 2008 crash, and he had to put a lot of work and $$ into them. The rise in selling prices in these neighborhoods has been modest. You assume he will be able to collect this back rent. He and I doubt it. Fortunately, most of his clients are good people and though some have missed a few payments, most have managed to keep current, unlike this tenent who appears to be gaming the situation to avoid payment, and he can do nothing about it… for now.
Again, why should he alone pay the cost of someone else’s misfortune?
I’m sorry for your friend but he stills owns the houses. There’s “unfair” everywhere you look these days so at least his cloud has a silver lining. Hopefully the vaccines continue to work well and the summer will be better, he’ll get to evict his bad tenant eventually and find more.But seriously, he bought at the bottom of the last crisis and fixed things up so he’s probably a good landlord and he’ll get more good tenants, or he can cash out because it’s too much of a pain. Really it just looks like the brakes are on, most pay, some pay periodically, one is a deadbeat. That implies a number of apts., more than say three so the scale matters here and we don’t know what it is. One of the misfortunes of landlords is a few people don’t pay.
You friend owns an asset who for twelve years had renters pay the mortgage and the taxes on it. He is making way more than 10% since 2008.
I applaud your friends ability to plan his financial future.. but in a world where property owners rarely lose and ZIRP has inflated assets to the moon I have little sympathy.
This landlord could do what did afer I received a judgment against my deadbeat renters. I sent a copy of the judgment to the county tax assessor and told them to use it to pay my property taxes. The other day, I walked out of Wally World with a grocery cart full of food stuffs. When I was stopped in the parking lot I told them that due to COVID they can take what I owe out of this judgment.
There used to be something in the US Constitution about “equal protection under the law”. What a joke and probably one reason why people feel they need to pick up a gun and hold court
I’m with HSWB on this one. From the beginning, the pandemic zealots – all with top jobs or massive wealth – have chosen to ignore the economic fallout. They can’t even be bothered by the Chinese government’s continuing obstructionist tactics regarding the source of the virus.
Meanwhile, in the midst of an event that will certainly leave many homeless, the federal government continues to import millions of impoverished immigrants.
Four things to remember: (1) All of us know that things are falling apart. (2) The significant problems are irreversible. (3) The chaos will intensify. (4) It is impossible to be too cynical.
It’s unfortunate that the classical economic distinction between earned and unearned income has been lost. It’s a powerful solvent of sophistry.
If you take a risk investing in property, you can get access to big returns, but can’t complain that there are risks.
Let’s not even get started on the negative effects of property speculation on single home owners and renters.
Zero sympathy – in fact, I hope property investors lose EVERYTHING and get a taste of what it feels like to be on the other side.
A fellow co-worker has a couple of rentals he had picked up over the years. Well, he had one of those tenants that decided they do not have to pay rent. One day he came to work and said the tenant had just up and moved out in the middle of the night. It now seems the tenant has not been seen or heard from since and the cops now think my buddy may have buried him out in the desert. Not only that, because they think he probably had help they are looking at us co-workers. What a country we live in.
@HomoSapiensWannaBe — Touching that you feel the pain of renters and landlords screwed by the policy implicit in the CARES Act and kick-the-can policy for rents and mortgages. Society in general lost its ability to make laws for good or ill some time ago. Laws serve to transfer wealth from those with less to those with more. Renters will find homes on the streets and small landlords will lose their properties and any maintenance expenses they have already paid … REITs and private equity investors will scoop up whatever is worth having using inexpensive funds from the FED. The new Biden Infrastructure project appears to include a few goodies to help the REITs and private equity improve their newly acquired properties.
“I know someone who bought a few houses from a broker during the 2008 downturn, does most of his own repair and maintenance work, and looked forward to an extra income stream from this to help with retirement, which he is already old enough to do, but hasn’t yet.”
Could you flesh this out a bit? I’m curious where the broker your friend bought his houses from got the properties in the first place.
That sounds pretty sketchy, too. Clearly a speculator. Cry me a river. I’s almost impossible for the guy to have lost money on this.
Yeah, I asked the question because I didn’t want to jump to conclusions. My thought process was that if the man who purchased the homes from a broker (who may have gotten them through foreclosure sales of the homes of people who lost their jobs due to the financial crisis), then both the broker and the purchaser would be profiting off the misfortune of others. I don’t know if the scenario I’ve outlined is correct.
Clearly you are a speculator also, as your cards are on the table.
HSWB a speculator? Who knows, you sure don’t.
In that time-frame? Probably distressed – foreclosure/bank-owned/short sale. So available at a price that might make it possible to operate as a rental. Now it could be that he could sell at a price that would recoup his operating losses, but that price would probably reflect owner-occupied tenancy, not sale to another landlord. Keep in mind tax law limits the ability to recognize losses on so-called passive income so landlord could have significant carry-forward loss. Writing as one of those greedy landlords. Our properties are more upscale and tenants have been current on rent. Our hotel property though is in the dumper.
Now it could be a speculator on home prices could use rental income as a way to reduce carrying costs, but it sounds like this landlord is looking for current income, not speculating on resales.
We got some stuff from Ricardo, like the law of comparative advantage.
What’s gone missing?
Ricardo was part of the new capitalist class, and the old landowning class were a huge problem with their rents that had to be paid both directly and through wages.
“The interest of the landlords is always opposed to the interest of every other class in the community” Ricardo 1815 / Classical Economist
What does our man on free trade, Ricardo, mean?
Disposable income = wages – (taxes + the cost of living)
Employees get their money from wages and the employers pay the cost of living through wages, reducing profit.
Employees get less disposable income after the landlords rent has gone.
Employers have to cover the landlord’s rents in wages reducing profit.
Ricardo is just talking about housing costs, employees all rented in those days.
Low housing costs work best for employers and employees.
The Classical Economists had identified the parasitic rentier class at the top of society.
This wouldn’t do at all; they needed a new economics to hide this, neoclassical economics.
The early neoclassical economists hid the problems of rentier activity in the economy by removing the difference between “earned” and “unearned” income and they conflated “land” with “capital”.
They took the focus off the cost of living that had been so important to the Classical Economists as this is where rentier activity in the economy shows up.
We now don’t realise housing costs and the cost of living should be low
Employees get their money from wages and the employers pay the cost of living through wages, reducing profit.
US employers can pay wages elsewhere people couldn’t live on in the US.
They need to off-shore to maximise profit.
Neoclassical economics confuses making money and creating wealth so all rich people look good.
If you know what real wealth creation is, you will realise many at the top don’t create any wealth.
We now don’t realise that making money and creating wealth are two different things.
Private banks and states can create money out of nothing.
(Weimar Germany and Zimbabwe are the two states we normally hear about, as they got it very badly wrong)
We have taken this privilege away from states and it just lies with private banks.
https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy.pdf
The real wealth in the economy doesn’t lie in money, it comes out of nothing.
The idea is to ensure you have the right level of money in the economy for the level of new goods and services that economy produces.
Real wealth creation in the economy lies in the new goods and services that economy produces every year.
It took them a long time to disentangle the hopelessly confused thinking of neoclassical economics in the 1930s.
This is the second time around and it has already been done.
The real wealth creation in the economy is measured by GDP.
The transfer of existing assets, like stocks and real estate, doesn’t create real wealth and therefore does not add to GDP.
Real wealth creation, involves real work, producing new goods and services in the economy.
We don’t know enough about the economy to get our priorities right.
We put the rentiers above people that create real wealth, producing new goods and services in the economy.
They do make more money, don’t they?
Trump got the right hump with China and Germany.
They concentrate on creating real wealth, and have lots of manufactured goods for export, which is why they run big trade surpluses.
The Americans mess about transferring existing financial assets around and run a huge trade deficit.
They must be using neoclassical economics.
They don’t know what real wealth creation is.
I am sure that no one was hired to process applications.
Plus the application process was online, which means uploading documents and navigating websites, for renters who may not even have a computer.
The only way for this program to succeed would be in-person applications at a real office, and the ability of line personnel to write checks quickly to landlords.