The situation in the USA does not look definitely good. One in three tenants failed to pay the full part of the rent in the first week of July, according to a survey Apartment List. According to an analysis by the consulting firm Stout Risius Ross, almost twelve million people could be ordered to move out in the next four months.
In a number of US cities, such as New York or Houston, a fifth of tenants say they do not believe they will be able to pay rent for next month. In the technological heart of the USA – Silicon Valley – according to a study by Working Partnerships USA and the Law Foundation of Silicon Valley, over 43,000 households face the risk of eviction, which is sixteen times more than the usual numbers for the whole year.
According to MarketWatch, US Census Burea data shows how brutal this crisis in rents can be. Almost a fifth of tenants, which is almost 14 million, either did not pay their rent for the last month or paid late. “You would have to go back to the Great Depression to find similar numbers that we are seeing right now,” John Pollock of the non-profit Public Justice Center told Bloomberg.
According to Pollock, the situation is unique. “There is almost no comparison with the current situation, which is why it is so scary,” he said.
The reason is the coronavirus pandemic, which caused mass redundancies in the United States. Tenants have survived in recent months thanks to a combination of savings, credit loans, unemployment benefits and emergency state aid, which is due to end.
However, John Pawlowski, an analyst at Green Street Advisors, does not expect an immediate impact on the landlord. According to him, people will not pay for a car or credit payments to rent. “People still need a place to live,” he said.
In the long run, however, the current situation will also affect landlords, whose rental income will fall due to non-payment of rents and lower occupancy, Pawlowski said. According to an analysis by Stout Risius Ross, landlords could lose more than $ 22 billion over the next four months.