The National Association of Realtors says moratorium will bring “chaos” to rental housing sector and “bring more havoc” to the economy.

The Trump administration is instituting a nationwide ban on evictions through December 31 for renters making no more than $99,000 this year, or up to $198,000 for couples.

The order, issued by the Centers for Disease Control and Prevention (CDC), is effective immediately. The order is the result of an Aug. 8 executive action by President Donald Trump directing the CDC to “consider whether any measures temporarily halting residential evictions” are necessary to stop the spread of COVID-19, according to news outlet Politico.

The Trump administration has come under increasing pressure to ward off a wave of evictions after an eviction moratorium that was part of the CARES Act expired in July and Congress and the White House have failed to come to an agreement over a new relief package. The CDC’s order will cover up to 40 million renters, Treasury Secretary Steven Mnuchin told the House coronavirus subcommittee Tuesday.

“People struggling to pay rent, due to the coronavirus, will not have to worry about being evicted and risk the further spreading of or exposure to the disease due to economic hardship,” Deputy White House Press Secretary Brian Morgenstern said Tuesday, as reported by Newsweek.

According to the order, Section 361 of the Public Health Service Act gives the CDC the authority to temporarily stop residential evictions to prevent the further spread of COVID-19.

“Eviction moratoria facilitate self-isolation by people who become ill or who are at risk for severe illness from COVID-19 due to an underlying medical condition,” the order reads.

“They also allow State and local authorities to more easily implement stay-at-home and social distancing directives to mitigate the community spread of COVID-19.

“Furthermore, housing stability helps protect public health because homelessness increases the likelihood of individuals moving into congregate settings, such as homeless shelters, which then puts individuals at higher risk to COVID-19.”

The order does not relieve renters from the obligation of paying rent or complying with other terms of a lease. It also does not prevent landlords from tacking on fees, penalties or interest if a renter does not pay rent. Even under this eviction moratorium, renters can still be evicted for reasons other than failure to pay rent.

In addition to the income limits, in order to be covered renters must provide their landlords with sworn declarations that they have tried to obtain available government assistance for rent or housing, that they are unable to pay full rent because they have suffered a substantial loss of income due to job loss or hour cutbacks or due to extraordinary out-of-pocket medical costs, and that an eviction would make the renter homeless or force them to live in close quarters.

Criminal penalties for landlords who violate the order include “a fine of no more than $100,000 if the violation does not result in a death or one year in jail, or both, or a fine of no more than $250,000 if the violation results in a death or one year in jail, or both, or as otherwise provided by law. An organization violating this Order may be subject to a fine of no more than $200,000 per event if the violation does not result in a death or $500,000 per event if the violation results in a death or as otherwise provided by law.”

The National Association of Realtors and other housing groups blasted the order because it does not set aside any funding for either renters or property owners.

“While NAR appreciates and is supportive of administration efforts to ensure struggling Americans can remain in their homes, this order as-written will bring chaos to our nation’s critical rental housing sector and put countless property owners out of business,” said NAR President Vince Malta in a statement.

“Any eviction moratorium must also come with rental assistance for property owners, the vast majority of which are mom-and-pop investors and are still required to meet their financial obligations even as they cease to receive income on their properties.

“An untailored eviction moratorium will bring more havoc to our economy, not less, and will put America’s 43 million renter households at significant risk. NAR strongly encourages Congress to pass immediate legislation that would instead provide emergency rental assistance programs directly to housing providers, protecting Americans’ access to affordable housing and our nation’s critical rental housing sector.”

In a statement reported by The Washington Post, Doug Bibby, the president of the National Multifamily Housing Coalition, said, “Not only does an eviction moratorium not address renters’ real financial needs, a protracted eviction moratorium does nothing to address the financial pressures and obligations of rental property owners.” He added that the “stability of the entire rental housing sector is thrown into question.”

And the National Low Income Housing Coalition (NLIHC) noted that the order delays, but doesn’t stop, evictions and like NAR urged government leaders to negotiate relief legislation.

“While an eviction moratorium is an essential step, it is a half-measure that extends a financial cliff for renters to fall off of when the moratorium expires and back rent is owed,” said NLIHC President Diane Yentel in a statement, as reported by The Hill.

“This action delays but does not prevent evictions. Congress and the White House must get back to work on negotiations to enact a COVID-19 relief bill with at least $100 billion in emergency rental assistance.”

Email Andrea V. Brambila.
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coronavirus | rentals
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