Locked Out: Eviction, Foreclosure, and Displacement in the Triad

Locked Out: Eviction, Foreclosure, and Displacement in the Triad Phillip Sheldon Graduate Research Assistant Center for Housing and Community Studies Kelsi Hobbs PhD Student Department of Economics

The Housing Crisis...

There is nothing inevitable about gentrification. Alan Mallach (2018)

Gentrification is the result of... Policy Federal State Local History Disinvestment Redlining and Racial and/or Economic Segregation Demographics The Return to the City Housing preferences of middle and upper income earners Economics Investment behavior Financialization of housing

[When speaking about gentrification,] the issue isn t displacement of the poor, but replacement. Jarrett Murphy (2015)

Eviction

One of the consequences of gentrification is eviction. Gentrification and Eviction Chum (2015) - Evictions tend to be higher in areas that are experiencing early stages of gentrification. - Evictions tend to be lower in areas that experienced gentrification previously.

Sociologist Matthew Desmond estimates that 2.3 million evictions were filed in the U.S. in 2016 - a rate of four every minute. - Terry Gross, 2018 Eviction in the Triad In 2016, over 22,000 households across Greensboro, High Point, and Winston-Salem experienced an eviction filing. Over 9,000 of those resulted in an eviction. Since 2000, on average, the Triad has seen: Median household incomes rise by ~5% Median gross rents rise by ~40% The percentage of cost-burdened renters rise by ~30%

Eviction in the Triad

Eviction s Consequences Eviction has been connected to homelessness - Crane and Warner (1999) increased neighborhood crime and poverty - Desmond (2015) increased material hardship amongst mothers - Desmond and Kimbro (2015) increased residential mobility, decreased standards of living - Desmond and Sollenberger (2015), Desmond et al. (2015) job loss - Desmond and Gershenson (2016) physical and mental health issues - Vasquez-Vera (2017) suicide - Rojas and Stenberg (2018)

Eviction s Costs Elliot and Kalish (2017)

Research from CHCS

VCAP Data: 2016 Case Results District Magistrate Total % CLOSED STATUS 62 48 110 0.66% DENIED 0 0 0 0.00% GRANTED IN WHOLE OR PART 37 9,563 9,600 57.83% INVOLUNTARY DISMISSAL 37 645 682 4.11% PAID BEFORE JUDGMENT 0 0 0 0.00% PENDING ORDER 1 0 1 0.01% RECORDED 2 0 2 0.01% SUSPEND ACTION SOLDIERS AND SAILORS ACT 0 0 0 0.00% STAYED SYSTEM ENTERED 0 0 0 0.00% VOLUNTARY DISMISSAL OR SETTLEMENT 30 5,699 5,729 34.51% ABANDONED WITHDRAWN OR MOOT 10 467 477 2.87% TOTALS 179 16,422 16,601 100.0%

Eviction in Guilford County

99% of cases involve non-payment of rent (based on landlord filing) Key Findings Only 1 in 4 tenants in appear in court, tenants often lack legal representation On average, the total amount due was: $998.52 (mean) or $750.00 (median)

307 plaintiffs filed 1149 summary ejectments. These 23 plaintiffs accounted for nearly half (46.1%) of all cases filed

Evictions were concentrated disproportionately within a few specific communities...

And these were primarily black communities.

Poor black men are locked up while poor black women are locked out. (Desmond 2016)

Filing for eviction has been used as a collection tool and as a way to move out old tenants and make way for higher rent Every time I m late, which is almost every month, they file the eviction papers and I get charged the late fee and the court fee. That s an extra $200 a month. Ever since my husband had lost his main job, and I been waiting on disability; we get filed on every month. Qualitative Interviews n = 20 All interview participants came from the court data for the month of May 2016. Tenants have been late paying their rent for a number of reasons, including job loss, loss of benefits, or maintenance issues [The landlord] was supposed to fix a few things or whatnot and ever since we stayed in there he didn t fix the whole sewage... the plumbing, and all that so we refused to pay. So that s what led to the eviction I guess. Eviction has negatively affected children by creating emotional distress and antisocial behavior, as well as affecting school performance [The eviction] emotionally affected my daughter at two years old. For a long time she kept asking me where her room was...where it went.

I was homeless for a week, lived in my SUV. After that, my mother didn t want me living like that so I moved to Virginia with family for about a year. It caused problems and separated me from my fiancée for a long time. I lived in a tent in the woods with my dogs for about two months before a woman gave me some money to get a hotel for awhile. When the money ran out I was back and forth in between the woods and living in a hotel whenever I had the money. 77% interviewees experienced some form of homelessness immediately following the eviction. I was homeless for over a year after that eviction staying on different people s couches. I just recently got an apartment. I had to put the apartment in someone else's name in order to get one.

The Cycle of Eviction

Foreclosure

Source: Foreclosure Connections

The foreclosed are more likely to be: 1. Younger 2. Latino 3. Experiencing economic hardship Who Are the Foreclosed? a. 42% of foreclosed reported that a member of their household has lost a job in the last two years. Foreclosures affect neighborhoods in the following ways: 1. Higher perception in crime 2. Higher unemployment 3. Those close to households experiencing foreclosure (friends and family) are also more likely to experience economic distress. (Niedt & Martin, 2013)

Foreclosure and Gentrification: What Happens to All Those Foreclosed Homes? Following a foreclosure, 3 out of 4 households (75%) move to a single-family unit (Malloy & Shan, 2011). Rise in single-family rentership Large-scale investors began to move into single-family rental market following Foreclosure Crisis (Dill, 2012). Investors tend to buy up lower cost properties (Ellen et al., 2013) Corporate investors tend to buy into communities with higher poverty rates and higher numbers of African American residents (Pfeiffer & Molina, 2013).

What are investors doing with these properties?

What are investors doing with these properties? Flipping is not necessarily predatory. Purchasers of foreclosed properties can also: Rehab To varying extents - take armchair rehabilitation Milk Focusing on cash flow Often results in code violations and substandard housing For Greensboro folks: the Agapions Hold Collect revenue from property rents, still seek highest amount of profit from the selling of the property. (Mallach, 2010)

What can local governments and/or communities do to combat residential replacement? Discussion Questions How is community power within the redevelopment process built? What can cities and/or communities do to develop this power - beyond simply standard practices of community engagement?

Possible Solutions

Longtime Owner Occupancy Program (LOOP)

Eligibility You must meet the following requirements to be eligible for LOOP. You are a homeowner whose primary residence s certified market value tripled (or more than tripled) between LOOP the current and preceding tax year. You have lived in your home for 10 years or more. Your property taxes must be current or you must be in an Owner Occupied Payment Agreement. Your income must fall below the cap set for your family size. Assessment 17,812 Philadelphians benefited from this program in 2015. Enrolled homeowners save around $1,000 every year. No household income restrictions More affluent homeowners living in communities experiencing sudden market value increases are more likely to use the program (Mallach, 2018).

Types of prevention/diversion: Eviction Prevention and Diversion Legal assistance Rental assistance Changes in law (just cause eviction ordinances) A selection of existing programs: NY Michigan North Carolina Coming soon: Greensboro

Website: chcs.uncg.edu Contact Us! Contact Information: Email: pgsheldo@uncg.edu Phone #: (336) 365-6859 Slides will be sent to attendees following the symposium.