TAMPA, Fla. (WFLA) — A U.S. Senate Committee was told, in no uncertain terms, that the rental prices facing Americans in the current economic environment was “brutalizing” millions of families.

The bipartisan U.S. Senate Committee on Banking, Housing, and Urban Affairs held a hearing on Tuesday to discuss the rental and eviction struggles facing the United States, as well as how COVID-19 policies played into the current housing crisis.

Five individuals provided testimony to the committee, discussing context from history to the current situation, including some issues caused by the way the U.S. government responded to the COVID-19 pandemic. However, those testifying said the issue of housing affordability has been brewing for decades.

Matthew Desmond, a Princeton University professor of sociology, directs the Eviction Lab, which researches the causes and consequences of housing instability, according to a brief provided with pre-hearing testimony. His statement, given before the hearing was underway, set the stage for the current residential environment in the United States.

He told the senators that rent in 2021 had increased faster than it ever has before.

“Since 1985, rent prices have exceeded income gains by 325%,” Desmond wrote. “Nationwide, median asking rent more than doubled over the last two decades.” He said that every part of the U.S. had seen a “surge” in the price to rent. “Since 2000, median asking rent has increased by 112% in the Midwest, 135% in the South, 189% in the Northeast, and 192% in the West.”

During the COVID-19 pandemic, the U.S., and the rest of the world, experienced economic stresses unlike any seen before, according to U.S. Federal Reserve. Policies designed to preserve America’s way of life, passed by U.S. Congress and two presidents, were broad. The economy is still recovering, but problems persist.

“This is the inflation crisis, the cost-of-living crisis, on steroids,” Desmond said in his statement. “When the price of gas goes up, that stings, but we adjust. We might cancel that cross-country road trip or carpool to work. When the price of food goes up, we adjust, eating out less often and re-planning our meals. But when the cost of housing rises 15, 25, 30%, what can families do?”

To that effect, COVID policies included an eviction moratorium, intended to prevent people from becoming homeless as businesses shut down and money stopped flowing in. Similarly, the U.S. government issued taxpayers three economic stimulus payments, to assist with paying for necessities and keep the economy itself afloat.

But the eviction moratorium had unintended effects on tenants and property owners, and was handled differently in different parts of the U.S.

Rosanna Morey, a small property owner from Long Island, N.Y., told the gathered senators of the committee how the eviction moratorium imposed during the pandemic and extended multiple times under President Joe Biden had affected her ability to support her family.

Morey is a cancer patient. As a small property owner, she rented out a rental unit in her home to a tenant. As her condition progressed, before the COVID-19 pandemic, she asked her tenant to vacate, intending for a family member to move in to assist her with caring for her family. The tenant refused to leave and filed in court to prevent it, according to Morey’s statements to the senate committee.

The problem worsened during the pandemic.

“The pandemic hit and the eviction moratorium was put in place, which, by the way, was originally intended only for nonpayment and COVID-related hardship cases,” Morey told senators. “But, somehow, all cases were lumped together. It did not take long for the tenant to stop paying rent.” Morey said that due to both federal and state moratoriums, her tenant was able to “abuse the situation” and live in the home without paying rent for two years. At the same time, they stopped following the lease’s rules and Morey said “there was nothing” she could do to stop her.

While Morey received funds from the Landlord Rental Assistance Program, set up by the state of New York to provide rental funds to landlords during the pandemic, it only provided funding for one year’s rent. Meanwhile, the tenant kept fighting in court, accumulating $10,000 in legal fees and $25,000 to fix up the area left damaged by the tenant.

Because of how the eviction moratorium functioned, Morey said landlords faced “abuse,” by some tenants, and a two-year backlog of court cases is adding to the housing shortage, as nonpaying tenants are able to remain in their dwellings while waiting for due process to complete. She told the senators “affordable housing providers like myself will reconsider renting” properties to avoid the costs.

Ranking member Pat Toomey (R-Pa.) said landlords had “predictably” increased rents and asked for larger security deposits as a result of the extended eviction moratorium from Biden, calling the moratorium itself illegal. He said the cost of housing itself was a result of the price of materials and “burdensome environmental impact reviews.”

“Tariffs on steel, lumber, and other building materials have the same effect. Rent control laws reduce the supply and quality of rental housing. Demand-side housing subsidies get capitalized into higher house prices and higher rents,” Toomey said in a prepared statement, adding “To improve housing affordability for all Americans—whether renters or owners—we should pursue reforms that leverage the power of free enterprise to increase housing supply and make markets more competitive.”

Material costs do affect housing supply and prices, for renters and homebuyers, but the main factor affecting affordability is lack of inventory and the “widening gap between incomes and housing costs,” according to statements by Diane Yentel, President and CEO of the National Low Income Housing Coalition.

“Even before the pandemic, millions of extremely low-income households – disproportionately people of color – were struggling to remain housed, always one financial shock away from falling behind on rent and being threatened with eviction and, in the worst cases, homelessness,” Yentel said. “On any given night, more than half a million people experienced homelessness, and millions more were at risk.”

The committee chairperson, Sen. Sherrod Brown (D-Ohio) made a similar statement to Desmond, that the issue of affordable housing had continued for decades.

“This isn’t a new problem. For decades, so many Americans have struggled to scrape together the rent each month. Too many have lived in shoddy housing with rodents, mold, or broken appliances,” Brown wrote. “That’s why, 90 years ago, this country began investing in affordable housing – so that everyone would have a safe, affordable place to live.” Brown said the funding for those efforts, however, “has never kept up with renters’ needs,” let alone maintenance.

Data from the committee testimony said America was almost 4 million homes short of what was needed to house the country, and that no state in the U.S. has enough to go around.

Focused on the most vulnerable, low-income renters, Brown said there are only 36 units that are “affordable and available” for every 100 Americans in need of housing. He said “there’s nowhere to go.”

Yentel had a similar point, saying that “Congress only provides housing assistance to one in four eligible households.” Her testimony said that 10 million of the country’s lowest-income renters pay half of their wages, if not more, on rent, meaning they don’t have the resources to buy food, medication, or just make ends meet.

The lack of affordable housing is also intensified by who buys property. Laura Brunner, the President & CEO of The Port of Greater Cincinnati Development Authority, testified about how “institutional investors are changing the landscape of single-family housing in Hamilton County.”

Brunner told the senate committee that investor purchases of residential property was adding to the housing crisis by investors buying thousands of homes, then keeping the properties’ prices high while not investing in maintaining them. She also told the senators that transparency was equally a problem, describing the difficulty of even tracking institutional owners down.

Using Cincinnati as an example, Brunner said that city officials “wanted to know who the worst landlords in the Cincinnati area were. It took months of rigorous research to uncover that over 4,000 single family homes in Hamilton County had been purchased by just five institutional investors since 2013.”

Finding them was “an arduous task and required review of numerous real estate transactions and auditor data.” Then, officials had to “track consistencies in owner name and addresses” on the county auditor’s site, before finding out that “the same five worst landlords identified” in a previous discussion with Cincinnati leaders were the same companies that owned the large number of struggling residences, where the “lack of
transparency with this type of investor model results in poorly maintained properties and negligent landlord practices.” She said institutional investors have bought larger and larger “volumes” of homes since the 2008 financial/foreclosure crisis.

Putting the point of reform into focus for small landlords, an Atlanta property owner who operates rental properties said the issue compared to changes made for bigger companies, was commonly overlooked.

Darion Dunn is Managing Partner of Atlantica Properties, a company he founded with his brother in Atlanta, Ga. He said his goal as a property owner was to make housing accessible, due to his parents teaching him that “‘home’ is more than a place—it is an ideal.” He said COVID-19 showed how the tenant-landlord relationship was intertwined, and painful, during the pandemic.

“The symbiotic relationship between tenants and landlords was put on full display during the height of the COVID pandemic. The financial pain felt by tenants was ultimately felt by landlords, and vice versa,” Dunn told the senators. “Fortunately, my company didn’t have a large percentage of delinquent tenants during the pandemic like many others in my industry.”

His testimony continued, saying tenants were sometimes not only unable to pay, but unwilling, mentioning a current tenant who has not paid rent since October 2020. The federal and local eviction moratoriums “prevented” the company from taking legal actions against them. He said the small inventory of affordable housing was also shrinking, “eroding as small landlords opt to or are forced to sell” due to costs that they can’t keep up with.

As it stands, the testimony before the senate committee showed the housing issue is complicated, and like other issues, does not have an easy solution. Wages have not kept up level of rental price increases, and according to those testifying, the available inventory for new homeowners or those looking to move is difficult when there is nowhere to go that they can afford.