A recent National Bureau of Economic Research study conducted by economists reveals evidence of heightened discriminatory behavior by landlords in the rental housing market during the COVID-19 pandemic. The study, based on data collected from an experiment involving over 25,000 inquiries to landlords in the 50 largest cities in the United States during the spring and summer of 2020, demonstrates that the implementation of an eviction moratorium disproportionately disadvantaged African Americans in the housing search process. The study suggests that discrimination worsens when landlords are unable to evict tenants for the duration of the eviction moratorium.
“We provide evidence of intensified discriminatory behavior by landlords in the rental housing market during the eviction moratoria instituted during the COVID-19 pandemic. Using data collected from an experiment that involved more than 25,000 inquiries of landlords in the 50 largest cities in the United States in the spring and summer of 2020, our analysis shows that the implementation of an eviction moratorium significantly disadvantaged African Americans in the housing search process. A housing search model explains this result, showing that discrimination is worsened when landlords cannot evict tenants for the duration of the eviction moratorium.”
The authors are likely to revise the study before final publication. However, the results are not surprising. Eviction moratoria make it challenging for landlords to evict tenants who default on rent, leading property owners to be more cautious about renting to individuals who are more likely to default, such as those in poverty. Studies also indicate that black tenants are, on average, poorer than white tenants and more likely to carry rental debt.
The NBER study is consistent with previous research showing that eviction moratoria and similar policies that hinder landlords from evicting delinquent tenants increase housing costs and reduce availability. These policies may also lead landlords to screen potential tenants more rigorously, potentially excluding those at higher risk of default.
While eviction moratoria may offer benefits to current tenants, they can limit housing availability for future tenants, including current tenants seeking to relocate. Alternative solutions, such as reducing exclusionary zoning and providing temporary rent subsidies, could be more effective in supporting low-income and minority tenants without negative repercussions on the housing market.
Legal and policy considerations aside, the effectiveness of eviction moratoria in aiding poor tenants is questionable. Even if legally permissible, the impact on housing availability and affordability should be carefully weighed in determining the best approach to assist vulnerable populations.
