When America Can’t Pay the Rent

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S1: Last week, I got an email from Jimmy Thomas, he’s a counselor at a Chicago community organization called the Northwest Side Housing Center. Jimmy helps people who are struggling to make rent, he wanted to give me a sense of why he’s so worried about a coming housing crisis that so far at least has been largely invisible. And so attached to his email was a spreadsheet of all the people he’s been talking to about the rent. Jimmy left off the names, but he kept the details. The spreadsheet has forty eight rows, forty eight families worried about their housing, and then there are the columns, a column for citizenship status, a column labeled Hardship, Mostly Lost Jobs, a column for how much each person’s rent is per month and how much they owe. There was also a column for landlord reaction with little cells filled with things like landlords understanding or landlord is not understanding or landlord says she needs to pay or leave.

S2: I picked a few numbers from the forty eight and asked him if he’d put me in touch, he reached out and the first person who got back to him was number twenty four. Hey, how are you doing? And this is number 24 on that Excel sheet.

S3: Well, my name’s Emily Sanchez and I’m 23 years old and I’m a single mom of two little kids, 18 month old and a three month old.

S2: Emily has bright eyes, glasses and a ponytail. She’s got a big tattoo of Jesus on the cross on her leg from high school. She’s lived in Chicago since she was three years old and has no memory of Mexico where she was born. She’s in this country illegally. While we spoke, her hands kept fidgeting in her lap like she was washing them. I’ve been living here for three years already. She lives on the second floor of a two flat on a pretty street on Chicago’s northwest side. When she moved into this apartment three years ago, she bought patio furniture to have summer barbecues. And that’s where we were sitting. Emily’s younger brother and 18 year old with autism and diabetes was watching after the kids. They were asleep. I don’t want to wake them up, OK, or I don’t know whether you want to tell me.

S4: There’s the backyard before the pandemic and before she called Jimmy. Emily wanted to go to culinary school. She says she got a full ride to a school in New York but decided to stay in Chicago to be closer to her mom. And instead she got an associate’s degree in pastry. Emily isn’t the only cook in her family, her mom makes fajitas and tacos and before the pandemic, they host cookouts to raise money.

S5: We were those type of people, the family that we always support, everyone I know. My mom has always said we’ve done fundraisers and the money that was raised, she takes them to the people because they need them.

S4: For a while, things were going great. Emily married her high school sweetheart. They had kids. They rented an apartment big enough to fit her mom and her brother leased a car. She worked as an assistant teacher at a daycare. It was at the daycare, eight months pregnant, that she first started hearing about the virus, honestly, when I heard it at the jobs, we were all making fun of it.

S5: But once we saw it starting spreading in the buses and stuff like that, we were like, you know, scared.

S1: We were like, what was going to happen when all of us on March 28th, the daycare said that their employees couldn’t come back unless they were tested a week later. Emily was on unpaid maternity leave.

S3: And on April 5th, I gave birth to a little boy. I had him. While the epidemic was horrible, I was the baddest treatment in the hospital. Yeah, they didn’t even let my mom come in or anything. It was just me have to having him, you know, I have to pass everything along because his dad just walked away out of the picture and started. And then I’ve been trying to look for him and stuff like he said, he doesn’t have a job and he can’t help right now.

S1: Over the course of just nine days in the middle of the pandemic, Emily had a child, lost her job and her husband walked out because she’s undocumented. She got no unemployment benefits and no stimulus check.

S6: It’s been almost four months since Emily’s son was born. And in that time, she’s made a sacrifice after sacrifice just to keep her family fed. She took out a payday loan from Opportune.

S7: They let me borrow one hundred dollars and I had to pay back five hundred, but I got my credit messed up.

S6: Now, she’s not buying anything but the cheapest foods for her family.

S7: My brother, my one year old get tired of eating spaghetti every day because I stayed for like a whole month. And one of them, you know, told me, we want meat, we want chicken or something.

S6: Even her dog, Blue is a vegetarian. Now, she stopped paying for the laundromat.

S7: I don’t have money for the laundry. I have money for a soap and all that stuff at the same dish soap that I get donated. I wash back and forth and she started selling stuff.

S6: Anything she could find.

S7: I found my mom had like Tupperware brandnew that she used to sign her company. So I started selling the, you know, the cheapest like the GoPro stuff like that that they had. That was the gifts that I have from Christmas. And we had to sell everything we had.

S8: We had to sell anything that you really cared about.

S5: Yes. My mom’s wedding rings. I had to go them to pay my brother. So diabetes, insulation and the straps and the little needles, I had to go on it right now. The gold went down like they said. So they gave me only it was seventy five dollars and I was worth five hundred. They said if I would have come from another crisis.

S9: But it was hard because, you know, he was, he needed the insulation and the, you know, the risk into going to the hospital and him going to himself was horrible.

S4: And then on top of it all this month, Emily’s mom got stomach pains so that she had to go to the hospital, which is where she was that afternoon when we sat down in her backyard. I’ve heard some crazy stories as a reporter, but I don’t think I have ever had a conversation quite like this one, so many American problems, the cruelty to immigrants, the immoral health care system, the predatory lenders, the inequality, the way we treat the poor, the way we treat women, the failed response to the virus. Everything seemed to have fallen on the shoulders of this twenty three year old sitting across from me as much an American as me, but with nothing to show for it.

S1: Emily does have one thing going for her right now, a roof over her head. This spring, Illinois joined other states in placing a moratorium on evictions. It is scheduled to last August, and it is keeping Emily in her home. She says she is four months behind on rent and owes her landlord more than 4000 dollars.

S5: Like they said, as soon as innovation starts, they’re going to turn in the order.

S1: But just because her landlord can’t officially evict Emily, it doesn’t mean he can’t make her life difficult.

S3: The L’Amour’s dad and brother to live downstairs and they have called the cops about five times already. They harassed me. They at 2:00 in the morning, they’re knocking. The kids wake up and I have to come downstairs and knock and say, you know, what’s going on? They’re like, well, you’re not paying the rent. We could do whatever you want. He told me that he was going to evict me and take out everything. I decided to go ahead and do it because one of the research I found told me they can’t do that.

S1: We weren’t able to confirm those allegations with the landlord or his family. But despite all this, when I asked Emily what she was going to do when she came into some money, this is what she said.

S3: Pay them.

S10: On the one hand, this seems like the worst possible scenario that could happen to anyone on the other. Emily was just a number on a spreadsheet, just a person I picked at random from one community group in one neighborhood of one city in Matthew DesMoines book, evicted from the Pulitzer Prize a few years ago. He notes that eviction isn’t just a symptom of poverty, it’s a cause, and that only I can see this. She’s suffered a lot. But what makes her story so painful to me is the thought of how much she still has to lose.

S4: I’m Henry Garba, and this is the fifth episode in our series on the future of the city after covid-19. Today on the show, evictions. How bad are things right now and what happens when the eviction machine starts rolling again?

S1: Here’s the thing about what’s happening right now with evictions, it’s hard to figure out. You can talk to people like Emily, you can reduce paper stories about the coming wave, but it’s hard to get a sense of the bigger picture. There’s really no data. So I called case management. You see the name Cass on the outside of so many apartment buildings throughout the city, you would think they own the whole thing. Cass manages more than 10000 apartments in Chicago, land across the income scale. They’re not the mom and pop landlord. So different from Emily’s situation. But they do manage properties for landlords and they only get paid when the rent comes in with a fee.

S11: Business were paid based on gross collected income, so there’s no rent being collected. We’re also, as a management company, not getting paid and thus affecting different parts of our business as well.

S1: This is Mark Jerkovic. He’s a principal and VP at Case Management. Mark says that is typical. On-Time collection rate has dropped by five to seven percent, which adds up to about fifteen hundred households who aren’t paying. Some tenants are a month behind or paying reduced rent. Others are in eviction territory, but with overlapping moratoriums at the city, state and federal level, they can’t be evicted.

S12: The only thing that the eviction moratorium has really caused a negative impact on all of the individuals that were in the eviction procedure prior now have basically been put in a position where you just added several months to what already is, unfortunately, in Chicago, a process that can take, you know, six to 10 months prior to covid-19. If you have a renter that is sitting in a unit for six to 10 months and now you add another six months to that process, it becomes a very challenging situation.

S1: Right. And when you say individuals that you mean the managers, presumably for the tenants, it’s a great situation.

S12: Well, I mean, look, it’s not a great situation. I’m sure they’re experiencing challenging times and such. But, look, the property is now experiencing a gap in income for a prolonged period of time. Those types of evictions that take six months before or 10 months before, if those are now taking 12, 14, 16 months, those become situations that I think will also lend themselves to alternative strategies that are bad for for everybody.

S1: You mean that like if if a landlord feels like they can’t file and get an eviction through the court system, they’ll just say, all right, well, we are not going to fix your window or something like that, you know, and it becomes this sort of escalating extra judicial battle over over the space.

S13: Well, it goes back to look, those are the types of things we as a professional management company will refuse to do, even if a a property owner were to advise us that that’s what they would wish to do because it’s illegal, you know, number one, and morally, we’re obligated to provide those services.

S1: Mark says Castle doesn’t do that kind of thing, but he suspects that other landlords will. What Mark is doing is negotiating.

S13: Let’s talk about a deferment plan. Let’s talk about if that’s not available. Let’s talk about vacating and ultimately more or less forgiving the balance and allowing people to vacate without experiencing an eviction on their record, without being afraid of waking up one day and finding a collection on their credit report with regards to unpaid rent.

S1: So you’ve come up with deferment plans. And then in a case where people are truly behind on their rent, you’re trying to say to them, hey, let’s let’s come up with let’s come up with an agreement where you can you can find someplace you can afford and we won’t have to initiate an official eviction proceeding.

S12: Exactly. Exactly.

S1: But if I were a tenant, I would be skeptical of that offer because you can’t evict them anyway. So what incentive do they have to to to accept your proposal that they take a hike and find a new place?

S11: Well, we we all know that there is an end to the eviction moratorium. So waiting out that entire period is going to allow someone to obviously take that situation and wait for three months, four months. But once that moratorium is lifted, the eviction procedures will will begin. And at that point, those types of offers may not be as readily available.

S12: You know, how many times are you going to be able to walk away from several thousands of dollars that you will owe?

S4: Mark sees himself and property owners at large as instrumental to a thriving city. He thinks that between the inducements, vacancies and unpaid rent, his rent rolls are going to drop 15 to 20 percent this year.

S13: Think about what impact that has. How does the building pay for cleaning staff, for repair staff, for the utilities, even us as a management company? If we don’t collect rent, we we don’t get paid. If we don’t get paid, we can’t pay the property manager, the receptionist, the accounting people, the operations management people and so forth. And what happens then? Right. Not only are people losing jobs, the building, the neighbors, the community are all being impacted because now you have a property that probably isn’t getting serviced and will probably lose professional management and will be left in the hands of a property owner who is not fit and able to manage those situations at the end of the day. It comes, at least in my opinion, a very, very, very scary situation.

S1: Yeah, I hear what you’re saying, Mark, although I suspect that the public sympathy will be more given the severity of the economic crisis will be more on the side of the renter who can’t make ends meet and and is worried about potentially being homeless or something like that more than the property manager who is struggling to make ends meet.

S12: I’ll ask you this question, though, if you don’t mind me doing that. When someone looks at it from the perspective of housing is a what would you say? You know, it’s obviously a necessity, but is it a human right? Do you do you walk into a restaurant and order food and walk out without pay? Do you walk into a pharmacy or a grocery store and pick up things off the shelves and walk out without paying? I think the answer to all those things is no. And these are these are individuals that own these buildings that a lot of them are reliant on that income to pay their bills.

S4: So this is the problem. On one side, we have Mark and an industry and urban economy built around people paying their rent. And on the other, we have people like Emily, millions of people struggling because of pandemic and unable to pay. How big is this crisis? I wanted the bird’s eye view, so I called Princeton University’s eviction lab the first nationwide database on evictions.

S1: The sociologist Peter Hepburn picked up. Look. Hey. Hey, Peter, this is Henry. Hey, guys. Peter, maybe we can start with this question that’s been bugging me, which is that according to the data that you guys are collecting, even in cities that have no longer have eviction moratoriums, we haven’t really seen eviction rates go through the roof. Right. Right. So what’s going on?

S14: Well, I think it’s you can chalk it up to a number of factors.

S1: Peter, give me three reasons why the eviction crisis hasn’t landed yet.

S14: First of all, there is still this federal eviction moratorium that’s in place. It’s hard to say how many renters that really covers. The best estimates are that it’s between twenty eight percent and forty five percent of all renters. So if you figure that’s, say, a third of all renters right off the top that can’t be filed against, then that’s going to be a big help even in places that don’t have any state or local level moratoriums.

S1: Unless that prohibition is extended, landlords of covered properties can begin filing evictions on August twenty fourth. Here’s the second thing.

S14: The expansion of unemployment insurance is a major income supplement to a lot of a lot of families. And a lot of those families are probably disproportionately renters. And so if you’ve got an extra six hundred dollars a week coming in, and especially in those cases when this actually represents greater than income replacement for for low income households, that’s probably helping to keep a lot of bills paid except for people like Emily who aren’t eligible for unemployment and for those who are the six hundred dollar federal payment runs out today.

S1: And here’s Peter’s third reason.

S14: The third factor is that even when a moratorium has been lifted, the courts in many parts of the country and especially parts of the country that are dealing with a real surge in coronavirus cases are having difficulty operating or trying to figure out how to operate under these new circumstances, which means that the normal case processing time on an eviction is kind of gone out the window. So what used to take three weeks is now taking months. And that slow down is a disincentive to landlords or property managers to file a new eviction.

S15: This, by the way, is already happening. Housing courts are open in cities like Milwaukee and Cincinnati, and evictions aren’t running ahead of what’s typical. But as we learned from Mark Tenant, sometimes leave without a formal eviction and no one, not even eviction lab knows how many people are getting pushed out under the radar. But there is something uniquely bad about a formal eviction filing. Whether or not you lose your case, you end up on a list that big property managers like Mark and even some small landlords may consult when you’re applying for your next apartment.

S14: It tends to lead to downward neighborhood moods where people are forced to accept lower quality housing in worse neighborhoods if they can find housing at all, it leads to worse health outcomes, increased reports of depression and stress, increased suicidal ideation. It increases your risk of job loss, material hardship and financial trouble going forward after the eviction process.

S1: How concerned are you about a major wave of evictions in the aftermath of this leading to homelessness? How frequent is that that an eviction leads to homelessness?

S14: That’s another thing that’s that is hard to measure. But I think we should be extremely worried about that. But we’ve also got to be concerned about families that are being evicted and then end up in doubled up housing. So they they get evicted and you and your kids go and live with your aunt. And so suddenly you’re living in more crowded, densely packed living quarters that, again, don’t allow for any sort of social distancing. Those are conditions under which this coronavirus appears to spread very aggressively. Clearly, it also affects homeless populations disproportionately. In either circumstance, you’re you’re kind of teeing up a public health crisis by exacerbating this housing crisis, which made me think of Emily.

S16: I know I was supposed to ask her what would happen next if she lost her apartment and her landlord changed the locks, what she would do with kids, with her stuff, with her dog. But it felt like it was something I couldn’t mention if she didn’t talk about it. I didn’t want to make her think about it.

S2: After talking in Emily’s yard for a while, we went upstairs to see her 18 month old daughter. She’s named for Emily’s grandmother.

S8: Say hi can say, how are you?

S17: Do you want to go play with them? Yeah, they have care about how this group of people will get Chappaqua, New York.

S16: And then it was time for dinner. Mariana’s Choice Tacos with zucchini, which a neighbor brought over from the community garden for once, something besides spaghetti.

S18: And that’s the show thanks to Emily Sanchez, Mark Markovitch cast Peter Hepburn at Eviction Lab and Jamie Thomas from the Northwest Side Housing Center. If you want to help people like Emily, you can donate to their organization at N.W. SHC Doug. What next, TBD is produced by Ethan Brooks there, John and Allison Benedikt offer editorial direction. Thank you, Alison and Derek. TBD is part of the larger what makes family TV is also part of Future Tense, a partnership of Slate, Arizona State University and New America. I’m Henry Gerber. Thanks for listening. Mary will be back in your feed on Monday.