Despite Agreement on US Stimulus Package... Concerns Persist Over "Insufficient Tenant Support"

Includes $25 Billion Rent Support Fund in Relief Measures
"Need to Adjust System, Lower Eligibility Criteria"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Daehyun] Although the U.S. Congress has agreed on a $900 billion (approximately 989 trillion won) COVID-19 relief package that includes a ‘rent support plan,’ concerns remain that it is insufficient to quell fears of forced evictions of tenants behind on rent.

According to CNBC on the 21st (local time), the relief package passed by Congress the previous day includes a provision to establish a $25 billion rent support fund. This fund can be used for rent payments, overdue electricity bills, and other expenses. Additionally, the eviction moratorium for tenants, which was set to expire at the end of this month, has been extended until January next year.

However, some economists and industry experts have assessed that the government needs to take more proactive measures to prevent a large-scale eviction crisis once the moratorium ends. Emily Benfer, a law professor at Columbia University, described the rent support plan as "insufficient to safely navigate the pandemic," advising that "each state should revise related systems, such as lowering eligibility criteria for receiving support funds. Eviction procedures should also be halted until housing stability is ensured." Mark Zandi, chief economist at Moody’s Analytics, also stated, "The support is not enough. Additional measures are needed."

Last month, research institutions and university experts analyzed that up to 40 million people in the U.S. faced the risk of forced eviction due to rent arrears since the start of the COVID-19 outbreak this year. According to a recent survey released by the U.S. Census Bureau, 18% of tenants are unable to pay rent, with 28% of Black tenants and 24% of Hispanic tenants experiencing difficulties in paying rent. Since September, the Trump administration has issued an executive order under the Centers for Disease Control and Prevention (CDC) directive, preventing landlords from forcibly evicting tenants who cannot pay rent.

There are also concerns that rent arrears could exacerbate the spread of COVID-19. Researchers at the University of California, Los Angeles (UCLA) warned that "if the eviction moratorium expires in January next year and people are forced onto the streets, new COVID-19 cases could increase by 433,700 and deaths by 10,700."

CNBC stated, "The priority is to ensure that the newly established support funds are delivered appropriately," and predicted that "the eviction moratorium may be extended again with the incoming Joe Biden administration." The Democratic Party has also pledged to introduce an additional relief package (the 6th stimulus) once the Biden administration begins its term.

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