What Is an Eviction Moratorium?
An eviction moratorium is a temporary ban on evictions, typically enacted by a government authority. This measure falls under the broader category of public policy within real estate finance, aiming to provide a safety net for tenants who might otherwise face homelessness due to unforeseen circumstances, such as economic downturns or public health crises. It generally prevents landlords from removing tenants from their homes, even if those tenants are unable to pay rental income or have violated certain terms of their rental agreement. The primary goal of an eviction moratorium is to stabilize housing for vulnerable populations, preventing mass displacements that could exacerbate a crisis or strain social services.
History and Origin
While eviction moratoriums have existed in various forms throughout history, often implemented during wars or severe economic depressions, their prominence surged globally during the COVID-19 pandemic. As large segments of the population faced job losses and financial distress due to lockdowns and business closures, governments worldwide recognized the critical need to prevent a widespread housing crisis. In the United States, for example, the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 included a 120-day federal eviction moratorium that applied to properties with federal assistance or federally backed mortgages12, 13. Following its expiration, the Centers for Disease Control and Prevention (CDC) issued a broader order in September 2020, temporarily halting residential evictions to prevent the further spread of COVID-19, which applied in most U.S. states and territories until it was ultimately struck down by the Supreme Court in August 20219, 10, 11. This unprecedented government intervention highlighted the role of housing stability as a cornerstone of financial well-being during a national emergency.
Key Takeaways
- An eviction moratorium is a temporary legal halt on the ability of landlords to evict tenants.
- These measures are typically enacted during widespread crises, such as public health emergencies or severe economic recession.
- Their primary aim is to prevent mass displacement and reduce homelessness.
- While in effect, a moratorium generally does not relieve tenants of their obligation to pay rent; accrued rent may still be owed.
- The scope and duration of an eviction moratorium can vary significantly depending on the issuing authority and specific legislation.
Interpreting the Eviction Moratorium
An eviction moratorium is primarily interpreted as a protective measure for tenants, offering a temporary reprieve from displacement during challenging times. It provides crucial housing stability, which can prevent individuals and families from experiencing homelessness and the associated hardships. From a broader perspective, an eviction moratorium can also be seen as a social safety net, aiming to mitigate public health crises and humanitarian issues by keeping people housed. However, it's important to understand that an eviction moratorium typically defers, rather than forgives, rent obligations. Tenants are usually still responsible for unpaid rent, which can accumulate as rental arrears during the moratorium period.
Hypothetical Example
Consider a hypothetical scenario during a widespread economic downturn. Sarah loses her job unexpectedly and is unable to pay her full rent for two months. Normally, her landlord would be able to initiate eviction proceedings shortly after a missed payment, leading to the potential loss of her home. However, if the local government implements an eviction moratorium in response to the economic crisis, Sarah gains a temporary shield. During this period, her landlord is legally prevented from serving an eviction notice or proceeding with an eviction lawsuit for non-payment of rent. This moratorium allows Sarah critical time to seek new employment, apply for rental assistance programs, or stabilize her finances without the immediate threat of displacement. While the moratorium protects her from eviction, Sarah still accrues a debt for the unpaid rent, which she will eventually need to address.
Practical Applications
Eviction moratoriums primarily appear as tools of government intervention in housing and economic crises. They are a form of consumer protection designed to stabilize the housing market and prevent widespread homelessness. During the COVID-19 pandemic, their implementation was seen as a measure to control the spread of the virus, as crowded shelters or shared living conditions exacerbated health risks8. Research from the Federal Reserve Bank of San Francisco indicates that COVID-19 eviction moratoriums reduced eviction filings and improved household financial well-being, especially for communities of color, by allowing them to redirect resources to necessities like food7. The U.S. Department of Housing and Urban Development (HUD) also offers resources related to tenant rights and eviction prevention, including grant programs to support legal services for low-income tenants facing eviction5, 6.
Limitations and Criticisms
While eviction moratoriums serve a vital role in protecting vulnerable tenants, they are not without limitations and criticisms. One significant concern is the financial burden placed on landlords, particularly small property owners, who may rely on rental income to pay their mortgages, property taxes, and maintenance costs. Extended moratoriums without corresponding rental assistance programs can lead to landlords facing their own financial distress, potentially risking foreclosure on their properties4.
Another criticism is that while moratoriums halt evictions, they do not eliminate the underlying debt. Tenants can accumulate significant rental arrears during the moratorium period, making it challenging to catch up once protections expire. This can lead to a wave of evictions once the moratorium ends, as seen when the federal CDC moratorium was blocked by the Supreme Court in August 20212, 3. Furthermore, the effectiveness and fairness of implementation can vary, depending on judicial interpretations and the presence of local support programs. The New York Times reported on the fears of tenants and the challenges faced by landlords when New York State's eviction moratorium ended, highlighting the ongoing tension between protecting tenants and ensuring the financial viability of property owners1.
Eviction Moratorium vs. Rent Control
An eviction moratorium and rent control are distinct public policy measures impacting the housing market, though both aim to support tenants. An eviction moratorium is a temporary, emergency measure that pauses the legal process of removing a tenant from their home. It is typically enacted during crises like pandemics or severe economic downturns to prevent mass homelessness. While active, it stops new eviction filings or enforcement of existing eviction orders for specific reasons (e.g., non-payment due to financial hardship). However, it generally does not forgive past-due rent, which can accumulate.
In contrast, rent control is a set of permanent or long-term regulations that limit the amount a landlord can charge for rent and how frequently rent can be increased. Its purpose is to maintain housing affordability over time, not to halt evictions during a crisis. Rent control laws are ongoing policies that affect the overall rental market dynamics, potentially influencing property value and property management strategies. While both can be forms of government intervention in housing, a moratorium is a temporary pause on an action, whereas rent control is a continuous restriction on pricing.
FAQs
What happens when an eviction moratorium ends?
When an eviction moratorium ends, landlords typically regain the ability to initiate or resume eviction proceedings for unpaid rent or other lease violations that occurred during or after the moratorium period. Tenants who accumulated rental arrears may face immediate pressure to pay or negotiate repayment plans, or they could face formal eviction lawsuits. This transition often leads to an increase in eviction filings.
Does an eviction moratorium mean I don't have to pay rent?
No, an eviction moratorium generally does not relieve tenants of their obligation to pay rent. It typically provides a temporary pause on the enforcement of evictions, but any unpaid rent usually accrues as a debt. Tenants are still legally responsible for paying the full amount of rent owed, and landlords may pursue these unpaid amounts once the moratorium expires. It's crucial for tenants to understand their rental agreement and any specific terms of the moratorium.
Who enacts an eviction moratorium?
An eviction moratorium can be enacted by various levels of government, including federal, state, or local authorities. During the COVID-19 pandemic, both federal agencies (like the CDC in the U.S.) and individual state and city governments implemented their own versions of eviction moratoriums, sometimes with differing scopes and durations. The specific authority depends on the legal framework of the jurisdiction.
How do eviction moratoriums affect landlords?
Eviction moratoriums can significantly impact landlords, particularly those who rely on rental income to cover their own expenses, such as mortgage payments, property taxes, and maintenance. While a moratorium is in effect, landlords may face reduced or halted income streams, leading to financial distress. Without adequate rental assistance programs to compensate for lost rent, some landlords, especially smaller ones, may struggle to meet their financial obligations or maintain their properties.