The New York Legislature started this month by extending the state’s eviction moratorium through Jan. 15, a top priority for new Gov. Kathy Hochul. The move offers temporary respite for some renters who were facing dire straits, but it’s a meager, top-down solution akin to a Band-Aid used to cover a festering wound.
Hochul and the legislators who passed the measure aren’t necessarily wrong. A crisis appears to be waiting just around the corner; the Census Bureau notes that about 1.2 million households are expected to be evicted across the U.S. within the next two months. The New York Times reports that only about 500,000 of the 2.8 million households that have applied for federal aid were successful, with 700,000 applications rejected and most of the rest stuck in bureaucratic purgatory.
Congress allotted more than $46 billion for the Emergency Rental Assistance Program as part of its pandemic relief bills, but the abject failure of state and local governments to distribute that money is becoming a glaring problem. In New York, ousted Gov. Andrew Cuomo simply ignored the problem all summer while instead marshaling the powers of state government against his political foes in a failed attempt to keep his job.
Hochul, to her credit, accepted responsibility for this before calling the special session to extend the moratorium, saying it was needed “since the State of New York failed in its responsibility to get the money that was allocated by Congress out to the people in need earlier this summer.” She added: “We also know that landlords are struggling and we need to make sure that small businesses are protected as well.”
Landlords aren’t always the most sympathetic figures. That’s especially true in Oneonta, where they tend to charge extraordinarily high rents comparable to those of much larger cities. Their reputation for greed wasn’t helped by their unsuccessful efforts to block the Hillside Commons and Lofts on Dietz projects, a shameless attempt to artificially restrict the supply of housing to ensure the deepest possible gouging of their tenants.
But if you don’t like your local landlord, be careful what you wish for. Many small-scale landlords have had their finances stretched thin by the yearlong federal moratorium, and those who have exited the rental business altogether are being replaced in many cases by banks and private equity firms.
Anyone who has attempted to buy a home this year has likely noticed that it’s a seller’s market. This isn’t a problem for deep-pocketed Wall Street investment firms such as Invitation Homes, a spinoff of private equity titan Blackstone. Invitation Homes has gone on a buying spree since the pandemic, and now owns 12,556 homes across 16 U.S. cities, according to Slate. The company’s size enables it to secure massive loans at rock-bottom interest rates unavailable to smaller landlords, leading to further concentration of U.S. housing stock into fewer hands.
It would be bad enough if this money was being sucked out of our community and local landlords to flow instead into the already-full coffers of Wall Street investors. But it’s worse than that; the Wall Street Journal notes that many of the homes abandoned by U.S. landlords are being bought up by sovereign wealth funds run by governments in the Middle East and Asia, a trend that has boomed since the pandemic.
“There’s been very limited overseas investment into the single-family rental space prior to COVID, but nothing on this scale,” said Alex Foshay, an executive with real-estate services firm Newmark, to the Journal’s Konrad Putzier earlier this year.
A future without an eviction moratorium would indeed be disastrous for some. But states and the federal government can’t continue to sweep this problem under the rug for much longer.
— The Daily Star, Oneonta