Former HUD Secretary Julián Castro on Future of Federal Housing Webinar with the former Democratic presidential candidate includes UCLA Luskin housing experts in a discussion of urgent policy priorities

By Bret Weinberger

Former U.S. Secretary of Housing and Urban Development Julián Castro characterized the seriousness with which American society ought to address the nationwide housing crisis by saying during a recent UCLA virtual event, “All of us have a responsibility to solve this challenge.”

Castro said there is no time to waste in facing this issue, with an eviction crisis looming because of economic fallout from the coronavirus pandemic. The Nov. 5 webinar focused on the future of federal housing policy as part of the Housing, Equity and Community Series, a joint endeavor of the UCLA Lewis Center for Regional Policy Studies and the UCLA Ziman Center for Real Estate.

Castro and Michael Lens, associate faculty director of the Lewis Center, spoke amid uncertainty regarding the nation’s political landscape just days before major news outlets called the race for President-elect Joe Biden. They delved into the interconnectedness of multiple ongoing crises and came ready with policy solutions.

Regarding protections for those who struggle to remain housed, Castro said that local governments should be empowered to enact rent control measures, even if it isn’t a one-size-fits-all remedy. And the federal government should robustly enforce the Fair Housing Act by working with local governments to put together implementation plans, as was the practice when he served in the Obama administration.

Castro, who unsuccessfully ran for president in 2020, also suggested changing the tax code to favor non-homeowners by offering a renters’ tax credit.

When Lens brought up the infusion of racial politics into housing policy, Castro castigated the Trump administration for assuming that racism exists among suburbanites and ignoring the realities of diversifying suburbs. He said their rhetoric translated into policy changes, such as removing protections against housing discrimination and underfunding key programs, that have exacerbated the housing crisis.

Castro raised cause for hope on the topic of homelessness when he said that both parties could agree on tackling veteran homelessness. He shared an experience of visiting Los Angeles’ Skid Row while HUD secretary.

“You can’t tell, just by looking at someone, why they’re there. You can’t stereotype them,” he said.

Lens also joined a second portion of the event that featured a roundtable discussion about topics covered by Castro, joining Cecilia Estolano MA UP ’91, founder and CEO of the urban planning firm Estolano Advisors, and José Loya, assistant professor of urban planning at UCLA Luskin.

“We need to be strategic, and we need to work fast,” Estolano said. She argued that incomes need to rise for people to afford high housing costs. Policies helping minority-owned businesses could have a major impact, she said.

Like Castro, Loya focused on how the tax code could be rewritten to help renters and low-income homeowners. This centered on granting tax credits to these groups rather than to wealthier homeowners.

One theme resonated with all the speakers: The new government, whatever its composition, must face housing head on. Americans — whether rural, suburban or city-dwelling — can’t afford otherwise.

View a video of the session on YouTube:

Few Trying to Skip Out on Rent During Pandemic, Study Finds

A new UCLA-USC study that took a deep dive into how Los Angeles County tenants are handling rent and finances during the COVID-19 health crisis was covered by media outlets including the Orange County Register. Since the start of the pandemic, landlords have argued that tenants who were shielded from possible eviction would refuse to pay rent, the article noted. In fact, while the study showed that many have struggled to make rent, most tenants have not used the pandemic as an excuse to take a rent holiday, according to the study conducted by scholars from UCLA Luskin’s Lewis Center for Regional Studies and USC’s Lusk Center for Real Estate. One factor measured in the study was the impact of direct assistance to renters who need it. The findings showed that tenants collecting unemployment insurance were 39% less likely to miss rent payments. The report’s findings were also highlighted in Courthouse News, Commercial Observer and Pasadena Now

1 in 5 Tenants in L.A. Has Struggled to Pay Rent During Pandemic, Study Finds Thousands of renters are at risk of eviction with moratorium set to expire; tens of thousands more are in a deep financial hole

By Claudia Bustamante

Twenty-two percent of Los Angeles County tenants paid rent late at least once from April to July, while between May and July, about 7% did not pay any rent at least once, according to a joint UCLA–USC report released today as a statewide eviction moratorium is set to expire.

The report documents the hardships faced by tenants during the COVID-19 pandemic, and it traces those hardships overwhelmingly to lost work and wages as a result of the economic shutdown.

Among households in the county that did not pay rent, either in full or partially, about 98,000 tenants have been threatened with an eviction, while an additional 40,000 report that their landlord has already begun eviction proceedings against them. California’s moratorium on evictions was scheduled to end Sept. 1, but at the last minute, lawmakers extended protections through Jan. 31, 2021. Federal action to protect renters from eviction at the national level through December 2020 has also been enacted.

The report by researchers at the UCLA Lewis Center for Regional Policy Studies and the USC Lusk Center for Real Estate analyzed data from the U.S. Census, as well as data from an original survey conducted in July 2020 of 1,000 Los Angeles County renter households. The survey, in particular, gave the researchers new insights into the circumstances facing renters. The study was authored by Michael ManvillePaavo Monkkonen and Michael Lens, all with the UCLA Luskin School of Public Affairs, and Richard Green, director of the USC Lusk Center.

“I think everyone understood, early on, that renters might be in trouble as a result of COVID-19 and its economic fallout, but conventional sources of data don’t give us a good window into whether renters are paying or not, and into how they are paying if they do pay,” said lead author Manville, an associate professor of urban planning. “We were able, by using data from a special census survey, and especially our own original survey of renters, to get a direct sense of these questions.”

The researchers first analyzed the U.S. Census Bureau’s Household Pulse Survey, a weekly survey that asked if renters have paid rent on time and if they think they will be able to pay the next month’s rent on time. This data was augmented by the UCLA Luskin–USC Lusk survey, which asked not only if renters paid on time but if they paid in full and if they were threatened with an eviction or had eviction proceedings initiated against them.

The study found that tenants have been facing unprecedented hardships during the COVID-19 crisis, substantially more so than homeowners. Overall, the study also found that most tenants are still paying their rent during the pandemic but are often doing so by relying on unconventional funding sources. The majority who pay late or not at all have either lost their work, gotten sick with COVID-19 or both.

Among the findings:

  •  About 16% of tenants report paying rent late each month from April through July.
  •  About 10% did not pay rent in full for at least one month between May and July.
  •  About 2% of renters are three full months behind on rent. This translates to almost 40,000 households in a deep financial hole.
  •  Late payment and nonpayment are strongly associated with very low incomes (households earning less than $25,000 annually) and being Black or Hispanic.
  •  Nonpayment is more common among tenants who rent from friends and family.

This crisis is particularly acute in the Los Angeles region and other high-cost cities, where an existing affordable housing crisis and an economic slowdown resulting from mitigation efforts to curb the pandemic intersect to threaten the stability of many households.

“Even before the pandemic, L.A. renters, especially low-income renters, were struggling,” said Lens, associate faculty director of the UCLA Lewis Center. And while most renters who miss rent have entered into some type of repayment plan, they’re not out of the woods yet.

“Nonpayment occurs disproportionately among the lowest-income renter households, so repaying back rent could be a tremendous burden for them,” Lens said.

The study also found that renters were suffering disproportionately from anxiety, depression and food scarcity, and they are relying much more than in the past on credit cards, family and friends, and payday loans to cover their expenses. One-third of households with problems paying rent relied on credit card debt and about 40% used emergency payday loans.

The prevalence of these nonconventional forms of payment, along with the incidence of job loss among tenants, suggests the importance of direct income assistance to renter households.

Tenants collecting unemployment insurance were 39% less likely to miss rent payments. Just 5% of households that hadn’t lost a job or fallen sick reported not paying the rent.

Co-author Green, director of the USC Lusk Center for Real Estate, said that although data show that most renters have been paying their rent, government policies can help strengthen the ability to do so.

“One of the main concerns among landlords at the beginning of the pandemic was that tenants weren’t going to pay their rent if they knew they weren’t going to be evicted,” Green said. “Not only have we not seen any evidence of this, but getting money in renters’ hands through unemployment insurance or rental assistance helps a lot.”

Co-author Monkkonen, an associate professor of urban planning and public policy, agreed.

Helping renters now will not only stave off looming evictions next month but “also prevent cumulative money problems that are no less serious, such as renters struggling to pay back credit card debt, struggling to manage a repayment plan or emerging from the pandemic with little savings left,” he said.

Across the state, most evictions were halted in April by the California Judicial Council, the state’s court policymaking body. The eviction moratorium was set to expire in June, but it had been postponed to Sept. 1 to allow local and state lawmakers more time to develop further protections, including the bill currently under consideration. Given the unconventional means renters reported using to pay rent, the new study says that policies that provide funds to renters could help mitigate a raft of evictions and homelessness that had been predicted by previous reports by researchers at UCLA and elsewhere.

The study was funded by the Luskin School, the UCLA Luskin Institute on Inequality and Democracy, the UCLA Ziman Center for Real Estate, the USC Lusk Center for Real Estate, and the California Community Foundation.

Lens on Increasing Demand for Rent Control Measures

Michael Lens, associate professor of urban planning and public policy, was featured in an LAist article discussing a Burbank rent control measure headed for the ballot in November. Supporters collected 7,749 signatures to put the measure on the ballot, but it has been met with resistance by Burbank’s elected officials. “Calls for rent control in more places have probably gotten louder and more consistent,” Lens said. “Policymakers are paying more serious attention to [rent control] as kind of an emergency response to these various rental affordability crises.” He explained that politicians often look less favorably on rent control measures than their constituents because landlords have more political power than their tenants. According to Lens, rent control is considered a break-glass-in-case-of-emergency type of solution.


Lens Weighs In on Suit Against L.A. Development

Michael Lens, associate professor of urban planning and public policy, spoke to the Los Angeles Times about the AIDS Healthcare Foundation’s decision to sue the city of Los Angeles over real estate developments related to Councilman Jose Huizar, who has been charged with bribery, money laundering and racketeering. The lawsuit aims to block at least four city projects tied to Huizar and former Councilman Mitchell Englander that have allegedly violated California’s Political Reform Act. The AIDS nonprofit has been vocal on housing and development issues in the state. Some critics questioned whether the new lawsuit was an attempt by the foundation to slow or stop local development, regardless of its merits. Lens, who opposed a 2017 ballot measure championed by the foundation to crack down on “mega projects,” told the Los Angeles Times that “this seems to be a convenient excuse for them to say, once again, ‘We need to stop development.’”


Lens on Benefits of Affordable Housing

Michael Lens, associate professor of urban planning and public policy, spoke to the Los Angeles Times about the benefits of affordable housing following the U.S. Department of Housing and Urban Development’s announcement that it would repeal the Affirmatively Furthering Fair Housing regulation. Implemented by the Obama administration, the provision required cities receiving federal housing aid to develop plans to address patterns of segregation or risk losing money. The new regulation under the Trump administration would allow local governments more latitude in deciding if their policies were racially discriminatory. Recent studies have found that affordable housing developments led to crime reductions in low-income areas and had no effect in higher-income neighborhoods. “The infinitesimal risk of increased crime as a result of increased ‘affordable’ or multifamily housing in U.S. suburbs is massively outweighed by the benefits to those actually housed, and other benefits of reducing concentrated poverty,” Lens said.


Lens Argues for Increased Racial Equity in Urban Planning

Michael Lens, associate professor of urban planning and public policy, was featured in a New York Times article discussing the importance of inclusion and equity in reshaping public spaces. Many cities have rapidly transformed urban spaces in response to the pandemic, including new bike routes and more space for outdoor dining. However, many urban planning experts worry that these projects favor some residents and neighborhoods over others. The people who show up for public meetings designed to encourage community engagement tend to be older, whiter, higher-income and homeowners with the time and motivation to show up. As a result, pandemic infrastructure projects have largely left out poorer residents and racial minorities, many of whom are wary of police violence or community surveillance on city streets. “We need to either reduce the power that the white, high-income areas have, increase the power that communities of color and low-income communities have, or do both,” Lens argued.


Lens Leads Dialogue on Economic Empowerment in Black Communities

Michael Lens, associate professor of urban planning and public policy, moderated the July 6 webinar “Buying Black: Reframing Urbanism and Economics,” a conversation with three experts on the intersection of consumer behavior, city planning and efforts to dismantle systemic racism. A virtual audience of more than 350 tuned in to hear the dialogue on the importance of generating economic opportunities within the Black community. Author and advocate Maggie Anderson, CEO of the Empowerment Experiment Foundation, challenged viewers to make a commitment to supporting Black-owned businesses, saying, “We cannot keep fighting against racism in the streets with our protests if we’re going to keep enabling racism in the stores with our purchases.” A Kouture, president of the International Black Restaurant and Hospitality Association, described her efforts to use data on Black commerce to win support from investors, developers and government agencies in metropolitan areas around the country. And Matthew Miller, a cultural geographer at the University of Pennsylvania, described his research into Black business corridors, including in South Los Angeles, which are “not just a place for job creation and wealth accumulation” but also “community anchors for people to confront marginalization both within the Black community and outside of it.” Said Lens, “We are at this amazing and painful moment of racial awakening. Everybody’s lining up to make statements and say nice things, but we have long gotten past the point at which specific, concrete actions need to be made.” The panelists planned to reconnect to plan further collaboration following the webinar, which can be viewed on demand or on Facebook.


 

Lens on Pandemic’s Effect on Housing Crisis

Michael Lens, associate professor of urban planning and public policy, spoke to Dear Pandemic about housing market factors that are affecting how the pandemic is unfolding. Lens said he worries about the “short- and immediate-term losses of income of people who were already very tenuously housed.” For many families already spending huge amounts of their income on rent, the loss of one or two paychecks can mean being foreclosed on or evicted. While short-term policy interventions in the form of income and unemployment support and eviction moratoria have been implemented, they generally do not cancel or lower rent. Lens asked, “What happens when the eviction moratoria are lifted and people are still not able to pay?” In the short term, people must be sheltered without sinking into debt or losing their savings. In the long term, Lens said, the systemic problems of the housing crisis must be fixed.


Lens on Overcrowded Housing and the Risk of COVID Infection

Michael Lens, associate professor of urban planning and public policy, was featured in a CalMatters article discussing how crowded housing exacerbates the spread of COVID-19. Neighborhoods with large numbers of people per household have about 3.7 times the rate of confirmed COVID-19 cases per 1,000 residents as neighborhoods where few residents live in tight quarters. “The problem has increased in the past decade as neighborhoods have gentrified, pushing rents to rise astronomically,” Lens explained. In some neighborhoods in Los Angeles, two in every five households are overcrowded. A report from the UCLA Luskin Institute on Inequality and Democracy estimated that 365,000 households in Los Angeles County are at high risk of being forced out of their homes when the statewide freeze on evictions is lifted, which will push them into even more crowded conditions. “Absent some unexpected interventions and generosity … of course people are just going to be way less able to afford housing,” Lens said.