Testimony of NYU Furman Center before NYC Council
The Potential Eviction Crisis in the Midst of the COVID-19 Pandemic
Written Testimony of Matthew Murphy, Executive Director, NYU Furman Center | Joint Hearing of the Committee on Housing and Buildings and the Committee on Justice System | September 17, 2020
On behalf of the NYU Furman Center, thank you for the opportunity to submit written testimony related to The Potential Eviction Crisis in the Midst of the COVID-19 Pandemic. My name is Matthew Murphy and I am the Executive Director of the NYU Furman Center. We appreciate today’s important hearing on the significant housing challenges facing New Yorkers due to the ongoing and growing economic crisis.
The NYU Furman Center advances research and debate on housing, neighborhoods, and urban policy. This includes providing essential data and analysis that helps policymakers, community organizations, and many others to examine pressing policy issues.
The New York City Council provides support for the NYU Furman Center to produce housing data and analysis for the public. Since March, we have analyzed and tracked data to help contextualize the impact of COVID-19 on New York’s housing and neighborhoods. We would like to highlight a few findings from our recent work that we hope will assist today’s discussion.
There are several data sources we rely on to examine the scale of the issue. According to the most recent Census Bureau Household Pulse Survey for August 19 – August 31, around 20% of New York City metro area renters were not caught up on rent payments, only around 45% reported a high level of confidence in their ability to pay September’s rent, and around 34% reported they believed they were at least somewhat likely to be evicted in the next two months.[i]
We have also examined labor market data to analyze the scale of New York City renters struggling to pay rent.[ii] Using Unemployment Insurance claims filed through June 4, we found that nearly 735,000 households in New York City had at least one household member lose employment income as a result of the pandemic. Restoring these households to their pre-pandemic housing cost burdens, assuming a 25% recovery in employment, would require $532 million per month in rental assistance. It is also important to note that over 50 percent of renter households were rent burdened, spending more than 30 percent of gross income on housing costs, even before the pandemic. This suggests that the Federal government is the only entity to be able to provide this level of assistance.
In regards to actual eviction filing data, New York City Housing Courts stopped accepting new eviction cases on March 20 and began accepting new cases on June 20, though new cases are automatically suspended.[iii] Since then, there have been 6,988 residential eviction filings through September 6.[iv] In prior years, there was an average of 42,665 filings over this same period. Moreover, during the time housing courts were not accepting filings this year (March 20 – June 19), prior years received an average of 39,349 filings.
Though currently lower than previous years, we expect that the combination of normal filing activity that would have taken place and new activity caused by the economic fallout from COVID-19 will lead to a tremendous increase in filings once courts return to normal operations. Some factors might mitigate this expected cliff, such as whether Federal assistance comes through to help renters, or whether landlords and tenants privately agree to negotiated terms in order to avoid an eviction filing.
While new eviction filings are automatically suspended and a moratorium on executing warrants of eviction is currently in effect, substantial uncertainty remains for both tenants and landlords. Tenants remain at risk of housing instability due to the ongoing economic crisis. Though the Tenant Safe Harbor Act will permanently preclude rent arrears accrued during the pandemic from being used to evict financially impacted tenants, it is unclear whether landlords can use future, post-pandemic rent payments to cover rent arrears. If landlords apply the first post-pandemic payment to the rental arrears from the pandemic, they could then claim non-payment of rent for the first non-moratorium month and seek an eviction. Additionally, while the Tenant Safe Harbor Act provides protection to financially impacted tenants, it still requires tenants to prove their pandemic-related hardship in court, a particular burden on households with inconsistent income and tenants who do not have access to counsel. Landlords are also allowed to seek money judgements under the Tenant Safe Harbor Act, which threatens already vulnerable households with long-term debt and bankruptcy.
Landlords who collect less rent may also face difficulty due to the financial obligations of owning property, such as property taxes, building maintenance, capital repairs, and mortgage payments. This could potentially impact the quality of our city’s rental stock. Additionally, our analysis of renter economic vulnerability found that more-vulnerable renters disproportionately live in smaller buildings.[v] Owners of small buildings, having fewer rent payers, appear especially vulnerable to lost rental income.
We hope that this information is helpful for Council and thank you again for the opportunity to submit testimony. We will continue to examine the impact of COVID-19’s economic fallout on housing and neighborhoods over the next several months and we would be happy to provide any additional data or analysis that assists the Council with examining housing issues during this unprecedented time.
[ii] NYU Furman Center, “Understanding the Potential Magnitude of Rent Shortfalls in New York Due to COVID” (June 4, 2020). https://furmancenter.org/thestoop/entry/understanding-the-potential-magnitude-of-rent-shortfalls-in-new-york-state
[iii] Executive Order 202.28. Office of Court Administrative Order 160A (2020).
[iv] New York State Office of Court Administration's Universal Case Management System.
[v] NYU Furman Center, “COVID-19 and the Rental Market” (April 30, 2020). https://furmancenter.org/thestoop/entry/covid-19-and-the-rental-market.