When the Supreme Court of the United States (SCOTUS) in late August finally ruled as unconstitutional the CDC moratorium on landlords evicting renters, many half-blind, hand-wringing politicians and media figures erupted with paroxysms of anger and fear, predicting that the move would see property owners throwing vast numbers of tenants into the streets.
Of course, as with most leftist approaches to economics, their predictions were way off base.
Christian Britschgi reports for Reason that the predictions included some fairly dark rhetoric:
’The Supreme Court failed to protect 11 million households across our country from violent eviction in the middle of a deadly global pandemic,’ said Rep. Cori Bush (D–Mo.), citing one estimate of how many renters were behind on rent.
Of course, given that statement, one has to remind Bush that the World Health Organization changed the definition of “pandemic” in March of 2009 to include the spread of much less lethal pathogens than used to fall under the meaning of the term.
But, aside from that, one also might ask her how a governmental body interfering in the fulfillment of private contract and in the practical suspension of voluntarily agreed-to rental payments can be termed “protection.” That’s like saying the government is “protecting” a diner by prohibiting the restaurant owner from asking for payment after serving a meal.
Indeed, engaging the government to immunize renters from the prospect of eviction inspires some renters to not pay, or pay reduced amounts, knowing they cannot be removed from the property – even as the property owners struggle to pay their mortgages.
It also inspires potential landlords to avoid entering the market, smothering the natural growth of rental unit availability, raising prices, and making it harder for potential tenants to find affordable housing.
But Bush and politicians of her ilk did not explore the real consequences of government meddling in the rental market. Instead, they played the Marxist “envy card,” depicting landlords as potential bad guys, when the real economic problem stemmed from political lockdowns of business.
And, lo and behold, it turns out that the landlords weren’t the baddies the left portrayed them to be.
In fact, the predicted vast surge in evictions was, well, not so vast…
’It's going up but it's not going up by a ton,’ says Peter Hepburn, a sociology professor at Rutgers University and researcher with Eviction Lab. ‘You look at September relative to historic averages, that leaves eviction filings at 48.5 percent below historic averages…We didn't see a jump up to normal, let alone a jump past normal into a giant wave of eviction filings.’
Britschgi notes that some municipalities and states are engaging in their own rent-subsidy programs.
And yet, even places that are doing a poor job of spending rent relief money are still seeing below-average evictions. Cincinnati, Ohio, has spent only about 15 percent of the first batch of rent relief funds it has received, and yet filings are about 80 percent of the historical average.
Part of this phenomenon might be explained by the fact that, during rough economic periods, landlords might work out arrangements with down-on-their-luck tenants to keep the spaces occupied with at least a portion of rent coming in, rather than see the spaces empty and not bringing in any income at all.
’My guess is if there had been no moratoria whatsoever, evictions would have still fallen very sharply in the spring of last year when landlords had very little shot of getting someone else in, and then bounced around at below normal levels,’ Salim Furth, a researcher at George Mason University's Mercatus Center, told Reason in June.
During a down economy, he explains, landlords have an incentive to work out deals with tenants who have trouble paying their bills. The alternative is to go through the expense of evicting a tenant only to have a vacancy that might be hard to fill in tough economic times.
And Britschgi dug further:
There is some evidence that landlords were more willing to cut tenants slack during the pandemic.
According to a report from Harvard University's Joint Center for Housing Studies, 48 percent of surveyed landlords deferred rent in 2020, up from 15 percent in 2019. Some 21 percent of landlords forgave some rent, up from 3 percent in 2019. The number of landlords who waived late fees also doubled.
So we have both constitutional and economic lessons here. Constitutionally, neither the CDC nor Congress have any so-called “power” to prohibit landlords from evicting non-paying tenants. Economically, interfering in the voluntary landlord-tenant relationship stands in the way of one-on-one, natural interaction – the kind of interaction that allows people to make market decisions and set examples for others.
Rather than getting the government involved, rather than blocking those interactions, perhaps the overall problem of politically-instituted lockdowns should be placed on moratorium, and we, as free people, should be allowed to make decisions for our own lives, livelihoods, and safety.