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L.A. Biz: Most L.A. tenants are paying their rent during the coronavirus crisis — but it's a struggle, study finds

August 31, 2020

By Annlee Ellingson 

Most Los Angeles renters are paying their rent on time and in full during the coronavirus crisis.

How they are managing to do so, however, is evidence of "renter distress" documented in new joint research from the UCLA Lewis Center for Regional Policy Studies and USC Lusk Center for Real Estate.

The report, called "Covid-19 and Renter Distress: Evidence from Los Angeles," found that from May through July, about 22% of Angeleno renters paid their rent late at least once. In each month surveyed — May, June and July — about 16% of tenants paid late.

About 10% of renters did not pay their rent in full for at least one month during the three-month period.

Renters who paid their rent late, or who paid only part of it, for at least one month had to find the money outside their usual channels. For example, more than 60% of households that paid part of their rent dipped into their savings to do so, and more than 40% said they took out a payday or emergency loan.

About 7% of renters did not pay rent at all for at least one month in May, June or July. And about 2% are three full months behind on rent, which translates to almost 40,000 households.

About 15% of households that were behind on rent were threatened with eviction, with about 2% of those surveyed reporting having eviction proceedings initiated against them. These proportions suggest that about 98,000 L.A. tenant households have been threatened with eviction, and 40,000 face eviction proceedings, the research extrapolated.

According to the report, "It is lost work or employment, along with sickness from Covid-19, that is the strongest and most consistent predictor of renter distress." Households that lost work or income are 2.5 to 4.5 times more likely to struggle paying rent than households that haven't.

The study concluded:

This evidence suggests the vital importance of getting more money into the hands of struggling renters. Our data strongly suggest that renters who can pay will. The vast majority of renter households who missed rent had members who lost work, became sick with Covid, or both. Delivering assistance to renters now cannot just stave off looming evictions, but also prevent quieter and longer-term problems that are no less serious, such as renters struggling to pay back credit card or other debt, struggling to manage a repayment plan, or emerging from the pandemic with little savings left. Renter assistance can also help the smaller landlords who are disproportionately seeing tenants unable to pay.

The report, authored by Richard Green, director of the USC Lusk Center, and UCLA Luskin associate professors Michael Manville, Paavo Monkkonen and Michael Lens, analyzed data from the U.S. Census and an original survey conducted in July of 1,000 Los Angeles County renter households.

The original article can be found here.