For millions of renters who remain unemployed during the COVID-19 pandemic, the recently finalized fiscal stimulus package is desperately needed relief.

The additional payments will bring their typical rent burdens from more than 80% of their income to less than half, a new Zillow analysis shows. While the extra assistance helps on a monthly basis, millions behind on their rent still face an incredible challenge in catching up on payments that have piled up before temporary eviction moratoriums expire, according to a Zillow news release.

Renters have carried much of the financial burden throughout the COVID-19 pandemic, in large part because of dramatic job losses in high-contact industries that are often staffed by renters. Zillow estimates at least 3 million renters who were employed last March had lost their jobs and were still out of work in November, including more than a million in the accommodation and food services industries that have been devastated by restrictions aimed at limiting the spread of COVID-19i.

Primary Income

Federal and state unemployment insurance is now the primary source of income for these renters who have lost their jobs. In November, a typical unemployed renter living alone spent 81.2% of that income on rent. The additional $300 a week from the current stimulus package will bring the typical rent burden down to 43%ii.

That is a huge improvement, but still well above the 30% threshold at which a household is officially “rent-burdened.” Previous research from Zillow and collaborators at the University of Pennsylvania and Boston University found that homelessness rates in a community rise sharply once typical rent burdens climb above 30%. The additional $600 a week in unemployment insurance payments from the CARES Act passed in late March brought the rent burden down to 29.5% for unemployed renters paying the typical rent.

“This analysis shows how much even relatively modest amounts of financial assistance can mean to struggling renters,” said Chris Glynn, senior economist at Zillow in the news release. “Even though supplemental assistance has resumed, there are financial wounds to heal from the three-month period when some renters were sending more than 80% of their unemployment benefits out the door on the first of the month. Temporary eviction moratoriums and unemployment insurance alone may not be enough to keep some renters who have steadily accumulated debts in their homes long term. Housing vulnerability for renters will be a top issue for the incoming administration.”

Federal Moratorium

A federal eviction moratorium remains in place to keep those unable to pay in their homes, though industry estimates show only small drops in the share of renters making payments in full compared to a year earlier. But the rent owed continues to accrue even without the looming threat of eviction. A study by Moody’s Analytics estimated that nearly 12 million renters will owe an average of about $6,000 in back rent and utilities by this month. While unemployed renters remain significantly rent-burdened, the additional $300 payments may help reduce the debt they will eventually owe when eviction moratoriums expire.

Renters who maintained stable employment in 2020, however, saw their rent burdens stabilize during the pandemic due to slowing rent growth for much of the year. In November, the typical U.S. renter who did not receive unemployment benefits paid an estimated 29.6% of their income on rent, a small improvement from 29.8% in MarchiiiRent growth has shown the first signs of a bounceback, potentially reversing the small gains employed renters made in 2021 and making it more difficult for the millions who have fallen behind on payments, the news release added.

Catching up any debts accrued will likely prove difficult for many who did not have much financial breathing room, to begin with. Low-income renters typically spent 53.1% of their income on rent in 2019iv, and Zillow research from before the pandemic and resulting recession showed that only 51% of renters said they could afford an unexpected $1,000 expensev.

Another potential cliff looms on March 14 when the current $300 weekly supplement expires.

Metropolitan
Area*

Typical Rent
(November
2020)

Rent Burden –
Unemployed
Renters w/o $300
Weekly Boost

Rent Burden –
Unemployed
Renters w/ $300
Weekly Boost

Rent Burden –
Unemployed Renters
w/ $600 Weekly
Boost (April 2020)

United States

$1,734

81.2%

43.3%

29.4%

New York, NY

$2,528

92.9%

53.9%

38.1%

Los Angeles-Long Beach-Anaheim, CA

$2,579

110.5%

62.4%

43.2%

Chicago, IL

$1,661

83.0%

45.0%

30.8%

Dallas-Fort Worth, TX

$1,570

82.2%

45.1%

30.7%

Philadelphia, PA

$1,610

79.5%

43.0%

29.3%

Houston, TX

$1,492

74.1%

41.4%

28.6%

Washington, DC

$2,039

115.7%

64.6%

44.8%

Miami-Fort Lauderdale, FL

$1,935

138.3%

65.5%

42.5%

Atlanta, GA

$1,607

83.5%

45.5%

30.7%

Boston, MA

$2,270

102.4%

58.3%

41.2%

San Francisco, CA

$2,985

125.0%

74.9%

53.6%

Detroit, MI

$1,322

64.3%

34.8%

23.5%

Riverside, CA

$2,206

96.5%

52.8%

35.7%

Phoenix, AZ

$1,558

124.8%

54.7%

34.4%

Seattle, WA

$1,891

97.5%

58.3%

41.2%

Minneapolis-St Paul, MN

$1,546

84.6%

45.4%

30.9%

San Diego, CA

$2,355

129.2%

69.4%

46.9%

St. Louis, MO

$1,154

67.4%

34.0%

22.4%

Tampa, FL

$1,581

108.3%

51.2%

33.0%

Baltimore, MD

$1,663

74.8%

43.8%

30.6%

Denver, CO

$1,743

94.2%

55.0%

38.4%

Pittsburgh, PA

$1,186

47.7%

28.2%

19.9%

Portland, OR

$1,665

80.5%

48.0%

33.4%

Charlotte, NC

$1,533

81.5%

42.8%

28.6%

Sacramento, CA

$1,948

91.4%

52.0%

35.5%

San Antonio, TX

$1,336

77.0%

40.7%

27.3%

Orlando, FL

$1,595

125.0%

59.4%

38.4%

Cincinnati, OH

$1,309

47.6%

28.6%

20.3%

Cleveland, OH

$1,140

59.1%

31.5%

21.2%

Kansas City, MO

$1,205

73.0%

37.5%

24.8%

Las Vegas, NV

$1,483

82.9%

44.6%

30.0%

Columbus, OH

$1,333

77.4%

39.8%

26.4%

Indianapolis, IN

$1,273

69.4%

35.8%

23.7%

San Jose, CA

$2,958

142.9%

85.8%

61.3%

Austin, TX

$1,539

81.8%

47.5%

33.3%

Virginia Beach, VA

$1,397

74.3%

41.1%

28.1%

Nashville, TN

$1,597

105.4%

50.2%

32.6%

Providence, RI

$1,609

71.8%

38.0%

25.7%

Milwaukee, WI

$1,213

64.7%

34.5%

23.4%

Jacksonville, FL

$1,400

101.5%

48.2%

31.0%

Memphis, TN

$1,320

81.7%

38.8%

25.0%

Oklahoma City, OK

$1,103

42.1%

26.3%

18.8%

Louisville-Jefferson County, KY

$995

59.6%

31.2%

20.8%

Hartford, CT

$1,391

67.6%

37.7%

25.9%

Richmond, VA

$1,330

74.2%

40.1%

27.3%

New Orleans, LA

$1,409

98.0%

44.0%

28.2%

Buffalo, NY

$1,123

60.6%

31.8%

21.3%

Raleigh, NC

$1,526

83.4%

44.7%

30.0%

Birmingham, AL

$1,104

71.4%

34.1%

22.0%

Salt Lake City, UT

$1,416

76.7%

43.1%

29.5%

*Table ordered by market size 

Source: Zillow