Almost half of renters in LA have to pay their rent

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In one new investigation of Los Angeles County renters, 49% of households said they were unable to pay their rent in full during the pandemic.

The study, conducted by researchers at UCLA and the University of Southern California, found that the median amount renters owe their landlords is $ 2,800. This suggests that across the county, tenants owe landlords more than $ 3 billion.

The results come from one of a pair of surveys of 1,000 tenants each – one conducted in July 2020, which focused on the ability of tenants to pay short-term rent, and another in March 2021, questioning their ability to pay over the entire pandemic.

Preliminary results show that in the two surveys, around 7% of tenants did not pay the rent in full for at least one of the three months before the study was carried out. But by the time the second survey was conducted, the share of tenants paying less than the full amount to a landlord at least once during the crisis had nearly doubled to 31%, down from 17% in July 2020.

The study was co-authored by Michel Manville, Paavo Monkkonen and Michel Lens, associate professors at UCLA Luskin School of Public Affairs; and Richard Green, director of the USC Lusk Center for Real Estate.

UCLA Lewis Center for Regional Policy Studies

A slight majority of respondents said they paid their rent on time and in full, and many of those who owed rent said they were less than a month late. But other tenants are emerging from the COVID-19 emergency into a financial hole they will struggle to extricate on their own, the authors write in a research brief released today.

Surveys show tenant debt has risen sharply as the COVID-19 crisis dragged on. Only about 6% of renters in Los Angeles said they used a credit card to pay their rent before the pandemic. This figure rose to 19% of those questioned at the start of the emergency and to 44% in the last survey. Also in the 2021 survey, 49% said they turned to friends and family to help pay their rent, 58% drew on their savings, and 37% said they took out an emergency loan or on salary.

The overall share of tenants running into debt reached 45% in the second survey, against 32% in the first.

Other findings include:

  • Just over 15% of tenants in arrears with rent payments in 2020 were threatened with eviction; this figure rose to 25% in the 2021 survey. Although a moratorium on evictions is still in effect in Los Angeles County, tenants can still be threatened with eviction or face evictions against them; a court will not act until the end of the moratorium.
  • Similarly, 6% reported in 2020 that an eviction had been initiated against them. In 2021, this percentage has tripled to reach 18%.
  • In the 2021 survey, about 68% of all respondents reported receiving federal assistance during the pandemic, and about 15% reported receiving local assistance.

UCLA Lewis Center for Regional Policy Studies

California’s moratorium on evictions will remain in effect until at least September, and the brief note that the state is committed to helping tenants pay the rent they owe. Under existing rental assistance programs, which typically require landlords and tenants to agree to participate, the state or city pays landlords on behalf of tenants eligible for assistance.

The problem? Data shows that many tenants owe money to people or institutions other than their landlords, and researchers write that many may be in this position precisely because they were deeply concerned about the security of their homes.

The report suggests a solution often advocated by economists as the best way to help people with financial problems: just give people money. Distributing money to financially troubled tenants would allow them to repay the person to whom the money is owed – a landlord, another creditor or a family member.

“Programs in which the government pays a landlord are sometimes justified as a means of preventing fraud or abuse,” Manville said. “And we should definitely be concerned about fraud. But we need to weigh these concerns against the possibility that an overly prudent program will deny needed help to some people who have real financial problems. “

To allay concerns about fraudulent claims – which in most government redistribution programs are very rare – the authors suggest ways the state could ask for proof of debt, loss of work, or income.

The 2021 survey was funded and produced by the UCLA Lewis Center for Regional Policy Studies in partnership with the USC Lusk Center for Real Estate, the UCLA Luskin School of Public Affairs and the Committee for Greater LA.



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