Investigating the Alleged "Eviction Crisis"

-edited

MarketWatch claims there's an eviction crisis. Let's investigate the claim.

MarketWatch writer Andrea Riquier claims the Eviction Crisis is Starting to Look a Lot Like the Subprime Mortgage Crisis.

Stable housing is increasingly out of reach for many Americans, as both rentals and homes to own grow more expensive and options dwindle. Evictions may be one of the most visible manifestations.

Now, a new study shows that not all evictions are created equal. Scholars at Georgia State University, in conjunction with a ProPublica journalist, examined “serial” eviction filings, or those done repeatedly by a landlord against a tenant. By comparing serial evictions to ordinary ones, the researchers found patterns of landlord behavior and intentions, some of which are reminiscent of the worst of the housing crisis a decade ago.

As a reminder, nearly half of Americans are “rent-burdened,” which means that they spend more than 30% of their income on rent. Homelessness is on the rise. Nationally, as many as one in seven children may have experienced eviction in the last decade. And, just as the foreclosure crisis disproportionately hit African-Americans, so does the eviction epidemic. Black women in Milwaukee, for example, were evicted at a rate three times their share of the population, and black renters in metro Seattle were evicted four times as frequently as whites there, according to earlier research.

The Georgia-based authors draw their own conclusions. “Serial filers may cater to tenants who are economically fragile and, like banks charging overdraft fees, they may have identified a way to capitalize on this fragility,” they write.

Study Findings

Let's go to the source: Multifamily Evictions, Large Owners, and Serial Filings

We examine multifamily eviction filings in the five-county metropolitan Atlanta area with a rich data set of eviction filings, property characteristics, and ownership information. We find that eviction filings include many "serial filings," in which landlords file repeatedly on the same tenant. The literature suggests that serial filings are aimed less at removing the tenant and more at disciplining the tenant through state-sanctioned threat of removal.

Nonserial filing rates are associated with relatively smaller buildings, a sale in the last three years, high neighborhood rental burdens, lower neighborhood education levels, and the share of renters who are Black. Serial filing rates are associated with high neighborhood rent burdens and race. Finally, higher shares of filings that are serial filings is associated with larger properties, newer properties, higher education levels, and the share of renters who are Black.

Study Conclusion

The study concludes "Nonserial filings are more likely to indicate landlords’ strong intentions to remove tenants, while serial filings are more likely to represent the use of the filing as a tool to coerce rent payment with the assistance of the state."

Study Nonsense

The study was in metro-Atlanta. The authors state "serial filing patterns in a high serial-filing state such as Georgia may not be highly generalizable".

What a hoot. Of course the result is not highly generalizable.

The study did not even mention the local eviction policy. Isn't that pertinent?

I see no basis for the conclusion. Yet, let's assume it's true. Here is my response:

So what?

Small landlords do not have the time or energy to deal with serial filing. That shows they prefer a high quality tenant.

If indeed serial filers have the suggested model, consider the impact if the model is taken away by laws or court rulings.

Q: Who the heck will rent to poor prospect tenants if there is not economic compensation for the risk?

A. Instead of worrying about being evicted, many low-quality tenants won't get an apartment in the first place. They will be homeless, on the street.

Not Enough Evictions?

Instead of fretting about too many evictions, consider the possibility there are not enough of them.

If it was easier to evict tenants for non-payment of rent, then more landlords might be willing to take a chance.

The serial evictions in Atlanta may be a measure of success, not failure. If economic illiterates make it harder to evict tenants, the result will be an increase in homelessness.

Mike "Mish" Shedlock

Comments (19)
No. 1-13
Carl_R
Carl_R

Unless I'm missing something, you can avoid eviction by paying your rent on time. When a payment is late, the lease is in breach, and the Landlord could simply proceed with the eviction, if they chose to. Thus, for there to be serial evictions against the same tenant, two things must be true:

  1. Those facing serial eviction proceedings must routinely pay their rent late.
  2. The landlord must routinely forgive the late payment, and dismiss the eviction
Six000mileyear
Six000mileyear

How verifiable was income and work history before approving the new renter? If credit card companies can use software to minimize delinquencies and defaults, then an opportunity exists to sell analytical services to minimize eviction notices. My guess is the software does not exist, or the data is too sparse to be accurate.

Curious-Cat
Curious-Cat

Do you suppose this has anything to do with the situation?

abend237-04
abend237-04

I've watched friends who are landlords for decades now. Their common traits are boundless trust in human honesty and the assumption that every stranger abides by the Golden Rule. They don't. On the other hand, People who rent houses from others seem to share the traits of people who rent cars and beat them to hell in 15,000 miles: If it's not theirs, they just don't care.

The most amazing thing is that most deadbeats can be quickly identified by checking references. If they have stiffed and robbed the last three who they rented from, they'll stiff and rob you too.

Hope springs eternal, indeed...in landlords.

jivefive99
jivefive99

I read the story in Marketwatch and thought it didnt make a lot of sense. I have a small building in Chicago, and rent to my friends, because I've tried calling the cops twice to remove one of them (no lease -- it didnt matter) and both times the cops said they couldnt do anything -- had to be formally evicted. So it is just easier for me to charge VERY generous rents and avoid the $1,000+ and months time itll take to REALLY evict anyone. Why would anyone be a serial evict-er? Who has the time, money or loves frustration that much?

AWC
AWC

DNC puff piece. Note the keys,,,, "Women," "Blacks," "Children" etc. Oh, but, but, but,,,,"A Study Says!"

That "Study" up there ^ bent the stats like jello.

WTH is a "Serial" notice to vacate? Once should do it. You didn't uphold your end of a written contract, therefore, go find another place to live. Besides, a lot of those rental agreements already contain late fee/grace period clauses.

Mish
Mish

Editor

I was a small landlord in Chicago for 10 years or so (2 units). I only lost 1 month's rent in that time and it was when one tenant moved out early because she admitted she would not be able to pay me. She was a single mother and I liked her. I bought her son Christmas presents.

Mish
Mish

Editor

"Unless I'm missing something, you can avoid eviction by paying your rent on time."

Apparently, that is a difficult construct for some people to understand.

Stuki
Stuki

When you have a ruling class of idle leeches, cheering on government to ban people from building enough housing to ensure it's available and affordable; solely in order to extract unearned usury for themselves and their equally deadweight bankster fellow travelers; it is inevitable you'll end up with people not being able to pay usury rent in exchange for roach infested shacks.

Building enough shelter to fit darned near ANY sized population almost cost free, was a solved problem eons ago; at least for those of us competent enough to tie our own shoelaces, instead of crying for government to force and "mandate" someone else to do it for us. The only, absolute only, reason access to something as simple as "housing" is even remotely a problem; is that we live in nothing more than a totalitarian, kleptocratic terror state, which exists solely to rob productive people for the benefit of deadweight leeches hopping up and down cheering for gommiment to ban someone, force someone, mandate that someone, harass someone, rob someone and redistribute that which others work for to themselves in exchange for virtually nothing in return.

Advancingtime
Advancingtime

Being a landlord is not all that much fun and "privacy" laws are making it harder to even check a person's credit if they want to rent an apartment. I have found the reason many people are evicted is because they do not follow the rules. This often means they become ineligible for government housing programs. By making them "ineligible" for certain programs the government shrewdly and cleverly sidesteps having to deal with these people. The brutal truth is that government housing cherry-picks the best of the low-income renters providing them with very low rents and nice apartments. More about how government is a big part of the housing problem in the article below.

Bam_Man
Bam_Man

This is why I no longer read Marketwatch or pay attention to what other people say about things written there.

inonothing
inonothing

Rents in the US are too high compared to stagnating wages.

We allow in too many immigrants, but housing policies are set at the NIMBY level. Either the Feds reduce immigration, or force urban centers to build more housing.