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The Government Is Walking Blind Into the Coronavirus Housing Crisis

The 2008 financial crash offered some stark lessons about evictions and foreclosures, but lawmakers didn’t learn a thing.

Valerie Macon/Getty Images

The 2008 financial crisis saw failures at every level of elite institutions. There was the failed promise of Federal Reserve Chair Alan Greenspan that the markets would self-regulate. The failure of policymakers to listen to community advocates who repeatedly sounded the alarm about predatory, racist lending practices. And there was a failure to bail out homeowners with the same speed and consideration that our nation’s megabanks received.

But behind these failures was a silent, insidious problem—one made more frustrating because it was comparatively easy to solve: During and after the 2008 crisis, no one actually knew how many evictions and foreclosures took place because no systems existed to track the losses of the affected families’ homes. More than a decade later, as the United States stares down another coming wave of mass displacement during the coronavirus pandemic, there’s still no federal database to track evictions and foreclosures. We’re sleepwalking out of the last crisis, into the next one—and the consequences for ordinary Americans could be grave.

A decade ago, the lack of a government database tracking foreclosures left policymakers reliant on data from the private actors that caused or exacerbated the crisis—like the Mortgage Bankers Association, a front group for the mortgage industry that lobbied heavily against state regulations; or the real estate information firm RealtyTrac, which stands to profit handsomely from a foreclosure crisis. As Sam Jewler and Chris Herwig documented in 2012, the lack of federal data led to wildly different estimates for the number of foreclosures. In Chicago, estimates for vacant properties ranged from around 5,000 (the official city count) to 18,000 (as reported by The Chicago Tribune) to over 100,000 (as city housing activists attested).

There is no official estimate for how many foreclosures there were in the last crisis. Journalist Laura Gottesdeiner, in her book A Dream Foreclosed: Black America and the Fight for a Place to Call Home, estimated that 10 million people were foreclosed on—a number roughly equivalent to the population of the state of Michigan. In 2009, the Congressional Oversight Panel noted that without accurate numbers, everyone was “flying blind.” The lack of data had consequences for policymakers, who were unable to do basic things, such as properly deploy resources to the hardest-hit areas or determine how many homeless families there were and where they went after they lost their homes. The absence of reliable information even led to massive problems for election “get out the vote” efforts, because voter files no longer had correct addresses.

To address this problem, in 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act mandated the creation of a database to track homeowners who were either late on their mortgage payments or in foreclosure. While there is a National Mortgage Database Program, the database’s sample size is woefully small: a mere 5 percent of all mortgage holders. The Consumer Financial Protection Bureau makes some anonymized data about mortgage delinquencies available, but it is also based on a 5 percent sample. Ten years since the passage of Dodd-Frank, the robust foreclosure database the law calls for is still nowhere to be found. As the saying goes, “You can’t manage what you can’t measure.”

While Congress at least attempted to solve its foreclosure blind spots a decade ago, it failed to address the hidden crisis facing renters during the same time frame. People refer to the 2008 crash as the foreclosure crisis, but it was also an eviction crisis. Family homelessness spiked. Private equity firms bought up foreclosed rental properties, leading to consolidation among landlords and predatory practices. Tenants in rental properties were displaced by their landlords’ foreclosures. That housing crisis is still very much with us: A 2018 report by the nonprofit affordable housing advocacy organization the National Low Income Housing Coalition, or NLIHC, found that the average renter’s wages are not enough to afford modest rental apartments.

What’s worse is that this rental crisis long predates the 2008 financial crisis, and it’s one policymakers in the U.S. have ignored for decades. The lack of eviction data is just one rotted part of a decaying whole. The government entity tasked with overseeing housing discrimination, addressing homelessness, and managing public housing, the Department of Housing and Urban Development, has a budget of less than $50 billion a year. But the annual cost of the mortgage interest tax deduction is about $112 billion a year in foregone revenue. This means that, as a nation, the subsidies for home ownership are more than double those for renters. This doesn’t take into account other external costs like the construction of the highway system, sewer system, and the other infrastructure spending necessary for the construction and maintenance of the suburbs.

And now the existing housing crisis is being compounded by the economic and labor shocks of the pandemic. The Covid-19 Eviction Defense Project, a private effort backed by philanthropic resources and not the government, estimates that 20 percent of America’s 110 million renters are at risk of being evicted by the end of September. The fallout from these evictions won’t just be economic. In his book Evicted, Matthew Desmond documented how eviction takes a significant health toll on people. Women who are evicted have persistent signs of emotional distress two years after their eviction. The U.S. is hardly ready to track the health impacts of evictions when we don’t track the evictions themselves, much less have a federal resource to let tenants see if they’re covered by the coronavirus-related federal eviction bans. While the NLIHC has made an effort to create one, using what data it’s managed to cull from several government agencies, Fannie Mae and Freddie Mac have not made all of their data publicly available, which means the NLIHC’s tool isn’t comprehensive. (The coalition has urged regulators to release this data so renters have all the information they need to protect themselves.)

Advocates have long tried to fill these data gaps left by the federal government. Community groups like San Francisco’s Anti-Eviction Mapping Project and Boston’s City Life Vida Urbana have created eviction trackers. Desmond founded Eviction Lab to build an evictions database in the vacuum left by the federal government. But the program, whose funders include the Gates Foundation and the Chan Zuckerberg Initiative, has been criticized for relying on big data brokers and undercounting evictions. Desmond himself originally proposed a federal evictions database and continues to support it. “The U.S. government should absolutely be keeping track of one of the most morally urgent issues facing Americans today,” he told The New Republic. To truly track evictions, we need the federal government. In late 2019, Senators Michael Bennet and Rob Portman introduced the Eviction Crisis Act” to build such a database as well as create a set of pilot programs to prevent at-risk tenants from being evicted. Currently, the bill is stalled in the Senate Banking Committee.

The Cares Act, recently passed in response to the pandemic’s economic ravages, created a moratorium on evictions at federally backed rental properties through July 24. This moratorium was extended on single-family home foreclosures and evictions to at least August 31. Regardless, these protections aren’t available to everybody. Undocumented people may not be able to take advantage of the eviction moratorium, because they put themselves at risk when they seek enforcement. And those with private landlords are dependent on their state to extend any local eviction moratoriums. (Eviction Lab has compiled a scorecard documenting protections by state and when they expire.) In Wisconsin, Governor Tony Evers banned all evictions through the end of May. But once the Wisconsin moratorium ended, Milwaukee saw evictions spike 13 percent compared to last June.

To address the failure of Cares to meaningfully address the looming eviction crisis, Representatives Maxine Waters and Denny Heck, along with Senator Sherrod Brown have introduced a bill to provide $100 billion in emergency rental assistance. Senate Democrats devoted a day of floor speeches to the problem on July 1. The House also passed an infrastructure bill on July 1 that included Waters’s “Housing is Infrastructure Act,” which allocates $70 billion to fully address needed repairs in one million public housing units. Besides Bennet and Portman’s eviction database bill, which Republican Senator Todd Young also co-sponsored, Republicans have expressed no interest in addressing the coming flood of evictions with either rental relief or additional funds for public housing. The dearth of eviction data prevents lawmakers, activists, and communities from meaningfully understanding the scope of the problem and advocating for these changes.

Congressional inaction is responsible for the failure to implement the required database to track foreclosures, a failure to provide needed funds for public housing and other solutions for at-risk renters, and a failure to prevent evictions during the coronavirus pandemic. If Congress now bungles emergency rental assistance, people will have to deal with the dual crisis of losing their homes and becoming more susceptible to the coronavirus—an unavoidable consequence of homelessness and housing insecurity. The lack of a federal system to properly track both foreclosures and evictions means that we will never fully know the scope of the harm done during this crisis, let alone ameliorate it. We will, nevertheless, have to live with the consequences.