Tenant Right to Counsel part 2: displacement and affordability
Displacement as a driver of profit in the housing market 🔍
Welcome to part two of our series on Tenant Right to Counsel! If you have no idea what I’m talking about when I say Tenant Right to Counsel, check out part one.
After laying out the basics of the policy in the previous post, we examined evictions through the lens of health outcomes and downstream effects and laid out the enormous societal cost of displacement. In part two, we’ll stay on that track and explore how displacement contributes to the larger housing crisis (also, be sure to check out Rebekah’s piece about how the “Housing Crisis” is made of many concurrent crises if you haven’t already).
If I pay my rent I won’t get evicted, right? Wrong!
Most of the scholarship around eviction and affordability focuses on high rents preceding evictions. I think this makes intuitive sense to most of us; If rents get too high, people can’t afford them, so they stop paying rent and then they get evicted. And while that’s true to some extent, it isn’t the whole story.
Nonpayment of rent isn’t the only reason landlords file evictions; just about any lease violation is grounds for eviction. There are plenty of estimates on how many evictions are due to nonpayment, but they vary to an almost useless degree. Seriously, I’ve seen numbers ranging from over 77% to under 17%, so I feel pretty comfortable in my assertion that nonpayment of rent isn’t the only factor. And regardless of how much of a factor it is, it’s naive to suggest that nonpayment alone is to blame for eviction and displacement. I’ll get into this in another newsletter, but the narrative that people are only evicted because they’re not paying rent serves landlords and developers, and in my opinion, undeservedly benefits their public perception.
In my time as a tenant organizer, I’ve seen people served with evictions for totally ridiculous reasons that had nothing to do with rent payments. Here are two of the more heinous examples.
1) Too many flower pots on the balcony.
2) Telling a prospective tenant about maintenance issues.
Take a second and ask yourself if either of those sounds legitimate. Is it worth someone potentially losing their home? Would it be worth your time to go to court to fight them? It had better be. See, when an eviction is filed against you, it’s incumbent on you to appear in court to respond to your landlord’s petition by filing an answer. If you don’t your landlord wins by default and you lose your home. There’s obviously a lot more to the process in court, but the details aren’t all that important for this piece. But if you’re confused by the legal jargon, just imagine how much worse it is when you’re in court instead of reading your favorite housing newsletter.
This is why it’s so crucial for everyone to have legal representation in housing court. The stakes are way too high and it’s too easy to make a basic mistake that could cost your shelter, not to mention getting you blacklisted from renting in the future. It doesn’t matter how silly your landlord’s reason for filing the eviction is; if you don’t show up or make a mistake in court, you lose your home.
But why evict someone if they’re paying rent?
There are reasons to create vacancies for reasons beyond a tenant’s ability to pay the current rent. Owners may need a property empty to finalize a sale, to finish building renovations, or for some other landowner reason that would never occur to my tiny peasant brain. The direct cause isn’t as important as the end goal: making money. And unfortunately, eviction is an effective means to that end.
Eviction is commonly used to skirt rent increase caps since most rent control regulations deal only with lease renewals and not new leases. For example, Oregon law limits rent increases to 7% plus inflation. If you want to raise rent beyond that, you need to find a new tenant. The problem is that in a hot rental market like Portland, plenty of landlords like their odds of finding that new tenant, so the question of eviction pencils out in purely economic terms, if not moral ones.
Whereas the prevailing wisdom stated that evictions are typically used to cut losses or protect an investment, there’s some evidence to suggest that evictions can in fact be used to drive profits. I can say, at least anecdotally, a not-insignificant number of evictions boil down to a desire to increase rent, so the previous example concerning rent control still stands. Additionally, Realtor.com data shows that new leases cost renters, on average, $300 more per month compared to $160 for renewing an existing lease1. And finally, studies in Atlanta2 and Indianapolis3 found large and/or corporate-owned landlords are more likely to evict their tenants than small landlords.
In combination, these things suggest to me that there is at least some economic incentive to evict tenants. Skirting rent control is obvious enough, but the average increased rent for new vs renewed leases seems important. The causality is more complex than just new lease = more money, but it would be asinine to pretend that isn’t true in a significant number of cases. How many people do you know who have stayed in a shitty apartment because they knew they’d pay more for a new place? Finally, the Atlanta and Indianapolis studies suggest to me that owners and property managers with better resources and access to analytics are operating under the assumption that evicting tenants at higher rates will lead to a higher long-term ROI.
I realize all of this may feel a bit disjointed, but there is unfortunately no comprehensive tracking of eviction data nationally, so I’m relying on a combination of smaller local studies and my experience in the world of housing and tenants’ rights to draw conclusions. Until we have better data and people willing to analyze it from a perspective beyond the how-to-make-a-buck-in-real-estate, this is the analysis we have to do as housing advocates.
If evictions can make landlords money, what’s stopping them from evicting people who shouldn’t be evicted?
Remember how this was supposed to be about providing people with lawyers in eviction court? Me too, let’s get back to that. Hopefully, the last few paragraphs have made you think about evictions in a new light. Some people are losing their homes because they can’t afford rent, but plenty more are being evicted purely because it will make their landlord money in the long run. And since housing is a profit-driven system, there needs to be some kind of anti-eviction counterweight if we want to avoid mass displacement in the name of profit (and if you read my last piece, I would certainly hope you see why that’s something we should want).
And that’s where Tenant Right to Counsel comes in. As it stands, landlords are able to use the mechanism of housing court to essentially run roughshod over tenants. Remember those two obscene eviction examples I provided earlier? Both cases were decided in favor of the landlords. It didn’t matter in court how ridiculous the reason was; the tenants in both cases had no idea how to navigate the proceedings and neither could afford a lawyer, so they weren’t able to present any evidence and lost their homes.
This is a feature of housing court, as far as landlords are concerned. It’s something they depend on in order to move tenants around as they see fit, and it’s going to get worse unless something is done about it. Tenant Right to Counsel already exists, it’s already working in several cities. We know the cost of doing nothing, and it’s immense. The reality of a profit-driven system is that when there’s money to be made by hurting people, the system will hurt people. It’s up to us to stop it, and Tenant Right to Counsel may not be a panacea, but it’s a hell of a lot better than what we’ve got.
Natalie Campisi, One Year After Eviction Moratorium Ends, Renters Face Affordability Crisis. Forbes
Matt Nowlin and Erik Steiner, Follow the Money: Indianapolis Evictions in 2022