The Cost of Displacement
Rent is due tomorrow and thousands of households are worried about the likelihood that they will be evicted and displaced from their homes, especially when COVID-19 housing protections are lifted in two weeks. These evictions will lead to an unprecedented displacement of working class families and an additional economic burden that isn’t considered by policymakers.
Along with the psychological trauma of being displaced from your home, there is a real immediate cost to being evicted, devastating households that are already deeply distressed. So, what exactly is the economic burden displacement imposes on LA’s renters? From physically moving a household to the emotional toll of having one’s daily life disrupted, the true cost is difficult to comprehend holistically. This research describes our analysis on the short-term financial costs that a displaced household faces.
For many households, the pandemic has severely interrupted their income, leaving many families worried about mounting debt and their inability to pay both rent and other bills. While California has installed some eviction protections for tenants that can prove they are impacted by COVID-19, these protections are temporary, deferring what many forecast to be an upcoming “tsunami of evictions.”
But, evictions and establishing permanent tenant protections were important issues before COVID-19. Public Counsel released a report in June 2019 on the need for permanent tenant protections in Los Angeles County to prevent homelessness and resist displacement. It cites that from 2010 to 2018, 505,924 court evictions were filed in LA County and that for every formal court eviction, there are two additional informal evictions. Informal evictions refer to those that may take place due to significantly increased rents, the creation of unlivable conditions due to deferred maintenance and neglect, or harassment from landlords. Considering this, the actual number of households facing eviction is much higher, meaning more community members are affected. The report also noted that low-income individuals and people of color disproportionately experience formal eviction. It is imperative that policymakers intervene to address this detrimental trend.
We estimate that a family being displaced will pay between $7,080 to $11,007 in displacement-related expenses. According to 2018 American Community Survey data, the median household income for a family that rents in Los Angeles County is $50,323 annually before taxes, or $3,259 monthly after taxes.
This means that if someone is evicted, they need between 2.2 to 3.4 months of income to cover the costs of displacement. This is based on incomes unaffected by COVID-19. The cost burden will be even more insurmountable when the “tsunami of evictions” pours through Los Angeles.
These costs include renting a new unit, moving your belongings, legal fees, security deposits, utility deposits, and more. We did not include data on items like delinquent meal debt, moving insurance, or furniture costs in our calculations because these vary from case to case. For households with little to no savings or safety nets like the 60% of Black and Latino households nation-wide who are asset poor, this financial impact is monumental. Imagine if each of the 505,924 families evicted between 2010 and 2018 had to come up with the $11,007 to move. That’s nearly $5.6 Billion in moving costs over that period. Considering the estimated two informal evictions for every formal one, nearly $12.7 billion has been paid by renting families. That is nearly $13 billion that hundreds of thousands of people could have used to pursue their educational, career, or business goals. Seeing these numbers makes one thing clear: housing rights and tenant protections are economic development issues.
You can find all of this information in this 2-page document.
Money aside, we found that the eviction process is immensely difficult to navigate. Significant time and resources went into researching what families facing eviction need to do. Even with the help of allied advocates, organizers, and lawyers, we found that some of this information was difficult to collect - such as what the process of a court eviction looks like should someone receive a notice. Lack of information was even more apparent in the case of informal evictions. Most rhetoric and resources about eviction are written from the perspective, or for the use of, landlords. Additionally, computer access, language, and literacy access can be barriers to acquiring the few resources that do exist. The information we found also did not cover the after-effects of eviction, such as the negative impact on one’s credit that makes it nearly impossible to rent elsewhere or access healthy capital. Researching eviction has been a humbling experience for us, further highlighting that our current policies are not designed to protect or help working-class people.
Eviction and displacement are ruinous housing trends that tear apart communities and place an immense economic burden on renters. There are many existing advocacy efforts to combat displacement of LA residents. If you are interested in getting involved, here are some immediate actions you can take:
Calling your Assembly member to voice your support for AB 1436 which will not allow for evictions for any lack of payment of rent during the COVID-19 emergency;
Calling your Assembly member to urge the extension of Emergency Rule 1 - the ruling that limits the court’s ability to enforce evictions - to 90 days after the emergency order is lifted;
Supporting the LA Homes Guarantee package introduced by LA City Councilmember Bonin that focuses on social housing and strengthening rent stabilization;
Advocating for the expansion of rent control across the State;
Pushing LA City Council and the County Board of Supervisors to expand the Right to Counsel which earmarks resources to fund legal and organizing support for tenants at risk of displacement, strengthening a tenant’s ability to stay in their home;
Advocating for anti-displacement language as the City updates the housing element of its general plan; and,
Repealing the Ellis Act, which has been a key tool used to displace residents throughout California.
It is estimated that 365,000 households will be displaced in the coming months once COVID-19 protections are lifted. Even more, 120,000 of those households are estimated to fall into homelessness sometime over the next year. People who have lost their jobs for the last ⅓ of a year will be expected to pay these costs. However, the high price tag on displacement is not something that occurs in a vacuum. City and county stakeholders can make conscious choices about fees, accessibility of resources, legal protections for tenants, and other factors that add to the economic and emotional burden of the eviction process. We must hold city and county stakeholders accountable for their role in perpetuating the LA housing crisis, and the economic toll it has on low-income families. We must do better to protect our communities.