Four corporate US landlords deceived and evicted thousands during Covid, report reveals
Elizabeth Warren and other lawmakers are looking to secure more tenants’ rights this week after a yearlong House investigation concluded that four corporate landlords aggressively evicted thousands of people, especially in communities of color, despite state and federal eviction moratoriums during the pandemic’s early days. They did so by misleading and deceiving tenants, even going as far as to falsely accuse tenants of neglecting their children.
The House select subcommittee on the coronavirus crisis revealed last week that during the pandemic’s first 16 months, four firms – Siegel Group, Pretium Partners, Ventron Management and Invitation Homes – filed nearly 15,000 eviction notices between March 2020 and July 2021, more than three times more than previously publicly available data showed.
“These four companies did not file eviction actions under financial duress, but rather did so while they were either experiencing record profits, making large investments in expansion, or obtaining significant government support,” the House report determined.
House investigators pointed at Siegel Group, which operates 12,000 apartments in eight states, as “uniquely egregious”. Executives and property managers would “bluff” tenants out of their apartments in ways that defied federal regulation. Documents obtained by the subcommittee found that a Siegel executive even ordered and distributed a court order that incorrectly said the CDC eviction moratorium was no longer in effect.
In a May 2021 case, a company executive allegedly directed a property manager to give a tenant a court order copy after 5pm so the tenant couldn’t call anyone to verify, hoping she would vacate the property over the weekend. In another, a directive from a senior executive to managers in Texas indicated that they try to replace a working air conditioner in an apartment in San Antonio with a non-working air conditioner and to call “Child Protective Services to come out” in the event a tenant had children in the apartment – ostensibly to make it look like the parents were neglectful. Falsely reporting child abuse or neglect is a felony offense in Texas.
Despite receiving nearly $1.8m in rental assistance from the Cares Act, as well as a $2.3m federal loan through the Paycheck Protection Program, Siegel evicted 89 tenants who had pending rental assistance applications. What’s more, investigators found that Ventron – which filed more than 4,000 evictions over the course of 16 months, even though it owned 8,000 units – and Pretium Partners applied a strict policy of filing evictions after one month of unpaid rent, despite the fact that it often took tenants three months to get rental assistance funds.
Overall, the evictions disproportionately upended the lives of poor people and renters of color, especially Black renters, who face significantly higher eviction rates than other races. An April 2021 study by the Private Equity Stakeholder Project, a non-profit that tracks eviction filings by corporate landlords, looked at the practices of Pretium Partners, which owns more than 55,000 homes across the US, in two majority-Black counties in Georgia and two majority-white counties in Florida with similar median incomes. They found that Pretium filed four times as many evictions in majorityBlack counties than they had in majority-white counties.
At the root of many of the evictions are private equity firms and other “nonindividual investors” that have increasingly purchased properties over the last two decades and converted them into rentals. Overall, the share of rental properties owned by these investors rose from 18% in 2001 to 26% in 2018. A 2022 report from the Harvard Joint Center for Housing Studies noted that the number of homes purchased by private equity firms and other “non-individual investors” hit their highest level in two decades toward the end of 2021.
In testimony before the House ways and means committee in late June, Elora Raymond, assistant professor in city planning at Georgia Tech University, noted that institutional investors began to establish themselves in Black and Latino neighborhoods in the Sunbelt region in particular during the foreclosure crisis in 2008. They have since spread across the country, and research from the National Association of Realtors found that institutional investors were attracted to buying properties “with a high density of minority groups especially Black households”.
In 2015, she co-authored a report for the Federal Reserve Bank of Atlanta that found that institutional investors filed two eviction notices for every 10 homes they owned, higher than the eviction rate overall in Atlanta. “You weaken the fabric of the community that is supposed to be there when one individual falls into trouble,” Raymond told the Guardian. “When it’s many, the entire community gets tested.” In testimony, she pointed to a subsequent study in 2021 that showed evictions from corporate landlords’ purchasing of properties “were associated with eviction spikes, and long-term gentrification and displacement of Black communities in Atlanta”.
The House report’s findings, Raymond says, reveals “the lengths to which these firms are going to extract more rents out of people to make more profit out of their properties”.
“They’re willing to destroy someone’s life.”
Peter Hepburn, an assistant professor of sociology at Rutgers University, Newark, and a research fellow at the Eviction Lab, told the Guardian that the House report revealed “just the tip of the iceberg” about the eviction practices from institutional investors and reinforced past research on how corporate landlords treated tenants before the pandemic.
The 15,000 evictions examined by the House subcommittee is only one part of the 1m filed across six states and 31 cities since mid-March 2020, showing that the extent of the problem and who is most at risk is undercounted. “It highlights the need to know more about who owns rental houses in our cities,” Hepburn said.
During a Senate hearing about America’s rental crisis on Tuesday, Elizabeth Warren called for the creation of a Tenant Protection Bureau to hold corporate landlords accountable for aggressive eviction practices.
The bureau, Warren says, would allow tenants to file complaints about landlords’ actions and “provide federal and local officials with the data they need to enforce tenant protection laws”. Diane Yentel, president of the Low Income Housing Coalition, said during the hearing that such a bureau “could have prevented untold harm and evictions of some of the most marginalized people”.
“If we had it today, it could help further enforce tenant protections, prevent egregious rent hikes, and let tenants hold their landlords accountable,” Yentel added.