Sep 08

Year to date evictions are down 28%.  August evictions are down down 37%.

In fact if you exclude the moratorium months of March, April and May, Milwaukee evictions are still down over 6%.

 Yet rent collections are off 8-16%, showing owners are working with tenants in unprecedented ways.

Milwaukee County Evictions
Aug 30

Matt Desmond’s op-ed piece in today’s NYT is a prime example of the over-emphasizing of relative differences in eviction filings:

In the last week of July, eviction filings were 109 percent above average levels in Milwaukee.” 
— https://www.nytimes.com/2020/08/29/opinion/sunday/coronavirus-evictions-superspreader.html

If one narrows the range enough, picking and choosing that which fits their predefined scenario, one can use otherwise factual data to say anything. 

A more accurate reflection of what is happening in the Milwaukee rental market is eviction filings are down by 26.6% YTD through 07/31/2020, despite an anecdotal 8-12% greater than normal non-payment. Rent has always been the financial elasticity in the “C” market, be it Christmas gifts, car repairs, or job loss.

If too many owners fail because they cannot collect enough rent to cover expenses, housing opportunities will only become more restricted and expensive. Municipalities will also fail as they “eat” three to four times more rent dollars in property taxes and municipal utilities than typical owners receive for their efforts and return on investment. 

Many scholars are warning of such widespread failures in the rental market. One example: Tenant Rights, Eviction, and Rent Affordability (July 4, 2020). Available at SSRN: https://ssrn.com/abstract=3641859 or http://dx.doi.org/10.2139/ssrn.3641859

In national interviews dating back to 1991, I’ve pointed out the near impossibility of paying rent for those with limited income. While the older articles are not online, here is a NYT interview from a decade ago:

On $673 a month, how do you buy tennis shoes for the kids, clean shirts for school and still pay your rent?” Mr. Ballering said.” ($673 was the W2, welfare, cash benefit at the time)
— https://www.nytimes.com/2010/02/19/us/19evict.html

Sadly nothing has changed in these 30 years. 

I fully agree with Desmond’s statement buried near the end of the op-ed, “Eviction is not a solution to landlords’ fundamental problem of maintaining rental income. Rent relief is.”  I would have been pleased to see this as your closing call to action.

The COVID crisis presents an opportunity for housing advocates, whether from the tenant or property owner perspective, to jointly push for a long term solution, which Matt Desmondinitially advocated for; portable housing vouchers.

Aug 30

A published research paper that found:

“Our research shows that in order to keep rental housing affordable and sustainable for low-income families, lawmakers have to walk a fine line in determining what will benefit the tenant and what may ultimately be detrimental to them,” Shen said. “On the surface, strict landlord regulation sounds good for tenants, but our paper points out, the solution isn’t that simple. The research suggests that conventional thinking on the issue of more regulation may have the opposite effect on tenants.”

“Though advocating for tenant rights seems noble and the right thing to do, the resulting consequences could have a devastating impact on this vulnerable population,” Shen said. “Our research indicates that if landlords aren’t allowed to evict, rent will likely increase to compensate for their losses. The housing supply would diminish, though the demand would still exist. These landlords may choose alternative investments if owning property is no longer feasible. A reduced housing supply would mean less competition, which would drive up the cost of rent for everyone.

Coulson, N. Edward and Le, Thao and Shen, Lily, Tenant Rights, Eviction, and Rent Affordability (July 4, 2020). Available at SSRN: https://ssrn.com/abstract=3641859 or http://dx.doi.org/10.2139/ssrn.3641859
Aug 15

July saw Milwaukee evictions up less than 4% over last year, despite local owners reporting 8-18% less rent collected than normal.

Statewide, July evictions are down 10%

The big story is January through July saw statewide and Milwaukee evictions both down just under 27% over last year, again despite the industry suffering well above normal rent losses.

Aug 10

https://www.pbs.org/newshour/show/could-federal-investment-prevent-an-eviction-crisis

DESMOND: In June, cities like Cleveland and Milwaukee saw evictions spike 30 to 40 percent above normal level when moratoriums expired.

[Ignores a greater than 30% overall decrease in 2020 evictions Year to date through June 30th. – Tim]

DESMOND: And it also doesn’t solve the landlord’s financial problems. You know, eviction right now, though, is kind of the only tool we’ve given to landlords, right? We haven’t seen a serious investment in housing from the federal government.

[Agreed – Tim]

DESMOND: And so when you’re a landlord and you’re in a pinch, you kind of reach for that pink slip.

[No landlord wants or wins when there is an eviction, rather they generally never recover the money lost. An eviction is either failure to screen or the tenant met with circumstances afterward. – Tim]

DESMOND: You know, we need a national moratorium on evictions. We need to say, look, in this pandemic, the home is medicine. The home is safety. And we have to protect that. Americans deserve that level of protection. Property owners need to pay their bills, too. And so we don’t just need moratoriums. We also need rent relief.

[There is no need for a moratorium if proper need-based rent subsidies are in place. Agreed that property owners need to pay their bills. The outcome if they can’t is chronicled at https://bit.ly/MoratoriumImpact – Tim]

DESMOND: We need a serious investment from the federal government with the recognition that everyone needs a stable, affordable place to live in normal times and especially during this pandemic. That’s true.

[Agreed – Tim]

Aug 07

I encourage everyone to download and read the following published research paper

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3641859

“Our research shows that in order to keep rental housing affordable and sustainable for low-income families, lawmakers have to walk a fine line in determining what will benefit the tenant and what may ultimately be detrimental to them,” Shen said. “On the surface, strict landlord regulation sounds good for tenants, but our paper points out, the solution isn’t that simple. The research suggests that conventional thinking on the issue of more regulation may have the opposite effect on tenants.”

“Though advocating for tenant rights seems noble and the right thing to do, the resulting consequences could have a devastating impact on this vulnerable population,” Shen said.

“Our research indicates that if landlords aren’t allowed to evict, rent will likely increase to compensate for their losses. The housing supply would diminish, though the demand would still exist. These landlords may choose alternative investments if owning property is no longer feasible. A reduced housing supply would mean less competition, which would drive up the cost of rent for everyone.

Jul 23

A recent Wisconsin Realtor Association podcast featuring Tom Larson and Tim Ballering.

https://www.wra.org/CapitolInsights/Episode5/

We have all heard reports that say residential rental evictions surged due to the Wisconsin eviction moratorium expiration in May.

The real numbers show a 30% decline for the first six months of 2020 versus 2019. How can this be true, you ask?

Listen in as WRA chief lobbyist Tom Larson and residential rental expert Tim Ballering from the Apartment Association of Southeastern Wisconsin (AASEW) break down the actual numbers and provide valuable insights into the eviction issue in Wisconsin.

Jul 15

A tsunami, an avalanche, a flood, a pandemic, and now a cliff of evictions.

No wonder no one tries to fix the root causes… some see it as a natural disaster, rather than something that with diligence can be fixed in a manner that is good for both tenants and housing.

When Desmond started, he had a great goal – universal housing vouchers, similar to food stamps, for people in need. But along the way, Matt was abducted by the Eviction Defense gang, a zero-sum game where individual tenants have small wins at the expense of the greater good for all tenants and housing.

Rather than eviction “defense,” which harms other tenants and housing by passing the cost burden to both, the better solution is eviction “prevention.” Even the recipients of the eviction defense come out of it with damaged rental histories. Excluding the attorneys, there are no long-term winners, only multiple losers.

Often eviction defense results in a tenant being able to stay for an extra month without paying rent. I wonder if there would be similar or better results if the money spent on eviction defense attorneys is used to pay a month or two of rent.

How many tenants have multiple evictions, or move without fulfilling their rental agreement every few years? Some get parents and friends to “front” for them as they cannot obtain housing independently from property owners. Others seek out small owners who do not know how to screen or go to owners who don’t care as long as they have a fist full of move-in money.

Prevention needs to occur before the rent is missed.

People at the bottom rung of the income scale will always have problems paying rent unless there is something like rent vouchers to help. What other societal costs could be reduced if the constant moving were to be reduced? I think there is a significant safety factor in knowing your neighbors, making it more likely you watch out for one another. What is the impact on schools as kids move, not just due to housing, but also utility disconnects? And so much more.

As I have said to Desmond in the past, I fully support his universal housing vouchers and am willing to work hard to promote it.

The numbers of people at risk of going over this “evictions cliff” are staggering: Data collected by the U.S. Census Bureau indicates that between 43 and 45 percent of adults live in renter households affected by recent job or income losses, and nearly half of all renter households were struggling to make ends meet even before the virus hit. A UCLA analysis projects that in Los Angeles County alone, about 120,000 households—including 184,000 children—are likely to experience homelesseness, and Black, Latinx, and poor families will suffer the most.

Having a lawyer in housing court can give tenants facing eviction a fighting chance: A March 2012 Boston study, for example, found that about two-thirds of people in the group with full-service representation were able to keep their homes, compared to one-third in the group that received more limited legal help. In Seattle, the King County Bar Association’s Housing Justice Project found that tenants with counsel are more than three times as likely to avoid a forced eviction executed by the local sheriff’s office and reach an out-of-court agreement with their landlord. When the agreement includes a payment plan for catching up on rent, tenants remain housed nearly two-thirds of the time.

Jul 01

On the Apartment Association email discussion board (free and open for anyone to join) there was a comment that the reduction in evictions “Seems obvious since couldn’t evict for 3 months.

Yes, it was obvious to those of us actually involved in housing.

But, some folks and the media were predicting a “tsunami” of evictions after the moratorium ended May 26th that would push us way past prior-year eviction counts in a single month.

For example, the Journal reported: “Predicted surge comes true: Eviction filings jump over 40% in Milwaukee County and state” citing a single week over week increase, using the first week that most evictions could be filed after the moratorium.

Owners are working with tenants more now than ever.

Groups such as the Apartment Association of Southeastern WI and the WI Apartment Association are working with Community Advocates and Legal Action to find resources to help tenants pay rent in ways never seen before.

Both “sides” understand that owners need their tenants to succeed for owners to remain viable, and tenants need owners to succeed for housing to remain available and viable.

My company has pledged to attempt mediation before eviction and waived late fees beginning in April, a month before the moratorium.

We need to remain vigilant as the true economic crisis may come later this year if the economy doesn’t rebound and /or the virus does. Regardless of your political leanings, the one thing we can all do is wear masks in public. If they do work, and I believe there is a value in wearing masks, then wearing a mask will keep infection rates down and allow businesses to remain open. If mask does not work, no harm, no foul.

Jun 21

Desmond says eviction filings are rising. “In Milwaukee, for example, evictions are up 38 percent last week from where they should be on a typical week in June in Milwaukee,” he says.

https://www.npr.org/2020/06/19/880859109/zoom-call-eviction-hearings-they-ll-throw-everything-i-have-out-on-the-street

This is accurate for the single week chosen, which was the first week when most evictions could be filed after the moratorium on notices, and the courts having been closed for months.

But it is a grave distortion of the overall facts, even if you only look at the month of June.

The greater truth is YTD evictions are down 40% year over year in Milwaukee and down 34% year over year statewide. I expect as June plays out those percentages will close a bit, but we will not see anywhere close to 2019 eviction rates.

Landlords never “profit” from evictions. It is always a money-losing, stressful time for everyone.

Property owners and managers are now working with tenants more than before to avoid court as this is a hard time for everyone.

preload preload preload