The Supreme Court of the United States on Thursday declared that the Biden administration’s federal moratorium on evictions was illegal, a major victory for landlords but one that places hundreds of thousands – maybe millions – of tenants at risk of eviction.
In a 6-3 decision, the court’s conservative members ruled that the Centers for Disease Control and Prevention had exceeded its authority in issuing the latest moratorium, which was set to expire in October.
“The C.D.C. has imposed a nationwide moratorium on evictions in reliance on a decades-old statute that authorizes it to implement measures like fumigation and pest extermination,” the opinion stated. “It strains credulity to believe that this statute grants the C.D.C. the sweeping authority that it asserts.”
The decision comes a day after the Biden administration said that only $5.1 billion of the $46.5 billion in aid to renters had been distributed by the end of July.
The Biden administration said consequences of the Supreme Court decision could be dire.
The recent changes to leadership in the FHFA have shaken the industry – but will the impact have a positive or negative impact on brokers?
Presented by: Flagstar Bank
“As a result of this ruling, families will face the painful impact of evictions, and communities across the country will face greater risk of exposure to COVID-19,” said White House Press Secretary Jen Psaki in a statement.
HUD Secretary Marcia Fudge added in a statement that America’s most vulnerable, including senior citizens, people with chronic illnesses, young children and very-low-income families, were at risk.
“I pledge that the Department of Housing and Urban Development will continue to use every tool at our disposal to protect those people whose health and well-being are now in jeopardy,” Fudge said.
The top court had provisionally ruled in June that the CDC exceeded its authority, but the administration pushed ahead with eviction moratoriums anyway, essentially buying time for renters. The Princeton University Eviction Lab found that the strategy was effective, if ultimately unconstitutional.
President Joe Biden had called on the U.S. Departments of Housing and Urban Development, Agriculture, and Veterans Affairs to extend each of their own eviction bans. He also urged Congress to pass legislation to extend an eviction moratorium.
The same day, more than a dozen real estate trade associations sent a letter to the Senate, the U.S. Treasury and HUD, urging them to “reject further extensions” of a moratorium.
Landlord groups have been pushing for the CDC’s eviction moratorium to be overturned for over a year, since the initial eviction moratorium, which was passed by Congress, expired in summer of 2020. They say they’ve been stuck with billions in unpaid bills, and few, if any, ways to recoup the missed rent payments.
“The government must move past failed policies and begin to seriously address the nation’s debt tsunami, which is crippling both renters and housing providers alike,” said Bob Pinnegar, the president of the National Apartment Association.
The latest ruling to overturn the CDC’s eviction moratorium “makes it all the more important to disburse the funds that have been allocated to communities to provide rent assistance to qualified renters and landlords,” David Dworkin, the CEO of the National Housing Conference, said in a statement on Friday. “For over a year, many apartment owners have covered the expenses and lost rent for renters unable to pay due to the pandemic. Most are small ‘mom and pop’ landlords who depend on rental income to get by. State and local governments must do whatever is necessary to move this historic amount of support or return funds for reallocation to grantees who are successfully getting the money out.”
The likelihood of tenants being evicted now largely depends on the laws of the state they live in. In places such as New York and California, eviction moratoriums remain in place for now. In other states, particularly in the South, renters could soon be at risk of eviction.
Nationwide, an estimated 11 million renters have fallen behind on rent, according to the Consumer Finance Protection Bureau. The agency’s analysis of U.S. Census Household Pulse Survey data in July found that 3.6 million people thought it was somewhat or very likely that they would be evicted in the next two months.