A new city report that attempts to quantify how much rent has gone unpaid due to the impacts of COVID-19 estimates it could be as much as $32.7 million a month.
The report from the budget analyst’s office makes an effort to paint a fuller picture of the impact COVID-19 has had on renters and their landlords, after they were unable to find any estimates of unpaid rent at the local or regional level.
There are admitted data limitations, but the report drew from a number of sources estimating the number of renters behind on rent and unemployment figures and made several assumptions, which explains the wide ranging estimates.
“Our resulting estimates of unpaid rent between April and September 2020 range from $13.6 million to $32.7 million per month,” said an advance copy of the report scheduled for official release Tuesday. “For the six month period, this equates to between $81.3 million and $196.2 million.”
The difference in the estimate largely stems from the assumption of the number of renters who filed for unemployment during this six month time period.
The low-end estimate assumes 13,765 renter households filed for unemployment, or approximately 6 percent of all renter households, while the high end estimate assumes 33,200, or 15 percent of all renter households.
The report also assumes a median monthly rent of $1,970 and factors in non-rent payments, partial payments and payments through assistance like expanded unemployment benefits.
The report was done at the request of Supervisor Dean Preston and comes as the Board of Supervisors is voting Tuesday on his legislation that would create a COVID-19 Rent Resolution and Relief Fund, which would provide revenue to landlords who forgive back rent.
Revenue for the fund is contingent upon the passage of Proposition I, before voters on Nov. 3, which would increase the tax on the sale of properties valued at $10 million or more.
The money in the fund would provide small landlords with up to 50 percent of the rent they are owed in back rent if they voluntarily waive the debt owed to them from tenants. Smaller landlords, those with 10 units or less, could receive up to 65 percent if they are facing a hardship.
Preston used the report as an opportunity to call for support of Prop. I.
“We are providing a roadmap for recovery, and that means making sure renters and small landlords are not left out in the cold if tenants can’t pay rent because of COVID,” Preston said in a statement. “San Franciscans have a choice: leave vulnerable tenants saddled by rent debt and small property owners at risk of default, or slightly increase taxes on billionaire real estate investors to help pay for our recovery efforts.”
Prop. I has drawn the ire of real estate investors who have funded a more than $4.8 million campaign against the measure.
But the report warns existing resources are limited to help renters pay rent.
“Unless new programs are adopted at the federal or state level, unpaid rent is likely to increase as long as San Francisco renters remain unemployed due to COVID-19,” the report said. “Anti-eviction programs remain in place for several months but unpaid rent will become due in March 2021 under current legislation in many cases.”
The City’s response to help provide rental assistance to tenants facing eviction due to COVID-19 is the Give2SF Housing Stabilization program, a mostly privately funded effort overseen by the Mayor’s Office of Housing.
The demand is high.
From May 4 through Sept. 30, 9,200 applications were filed asking for $43 million in housing assistance, the report said. That’s about an average of $4,700 per applicant, or roughly 2.5 months of rent.
In one example of the severity of the COVID-19 impacts, the report said that the Mayor’s Office of Housing had estimated in July that “up to 7,650 renter households at high risk of homelessness may need financial assistance” that could cost $50 million.
Most of the funding for the Give2SF Housing Stabilization program is spent, the report said, and there is no guarantee more donations will come in.
“The program currently has $7.5 million in direct financial assistance funding available, of which $6.5 million has been committed to help 1,449 households (around $4,500 per household on average),” the report said.