The first day of April brought with it much fear and anxiety for those left without work and income due to the Coronavirus.  Rent and mortgages payments are due!  The only Federal Mandate that protects renters and homeowners at the moment is President Trump’s announcement that The Department of Housing and Urban Development (HUD) will postpone all eviction and foreclosure proceedings until May 17th for federally-backed mortgages, subsidized housing, and housing that was funded under HUD financing.  This covers about 40% of Americans, meaning 200 million Americans are still vulnerable.

States and even cities throughout America have declared various levels of protection over the last few weeks.  In states like Georgia, there is no protection against eviction.  However, the government did postpone all ‘non-essential’ court hearings until April 13th.  Unfortunately, this does not prevent counties within the state from holding emergency hearings for landlords.  California has announced a postponement of evictions until May 31st, and some cities within the state have gone even further.  Los Angeles allows renters one year to make rent payments, and landlords are required to waive all late fees.  Washington Governor, Jay Inslee, announced a sweeping moratorium on evictions within the state, but that only covers tenants through April 18th.  The city of Seattle extended this moratorium through mid-May and enlarged it to cover all residential evictions, including those not rent-payment related.

This is not the first time our country has faced massive economic upheaval.  The 1929 Great Depression taught us much about what to expect for housing and unemployment during difficult economic times and what government intervention, or lack thereof, can mean for American citizens.

Looking To The Great Depression For Answers

Unemployment peaked at over 15 million, or nearly 25% of the entire population when President Roosevelt took office in 1933. The war brought a temporary end to unemployment by 1942, but rural America had already been in a depression of its own since 1920—more than 12 years by that point. To make matters worse, there were no safety nets in the 1930s to protect or give steady aid to the exploding homeless and unemployed populations.

By 1934, approximately 50% of urban homes with liens were in default, and the foreclosure numbers were beginning to skyrocket by the thousands each day. The American attitude against government intervention in individuals’ lives fundamentally shifted as they began losing their homes in vast numbers. With the loss of or cut back in employment, combined with the loss of their homes, many middle-class families were experiencing their first taste of impoverishment.


Hooverville, Seattle, 1935, Washington State Archives

Some cities had nothing to turn to but “Hoovervilles,” or the large areas with makeshift shelters set up near cities. Named to mock the President for whom they blamed their situation, Hoovervilles were made up of scraps, including old tires, cardboard boxes, newspapers, and flattened metal. The residents made their shelters with anything they could find, often creating unsafe living conditions.

What Worked During The Great Depression?

One area of relative success was Utah.  Utah, like the rest of the country, initially relied on voluntary charitable activities and local government to bring relief from the Great Depression. As cash was in short supply, communities had to be resourceful and look to creative options. Chambers of commerce throughout the state canvassed cities and towns block by block to identify people in need. The American Legion undertook a Job Canvas Program. Salt Lake City set up a relief committee and pushed other towns and communities to follow their lead. When the committee organized a massive campaign to raise funds for the indigent and homeless, they managed to raise a staggering $450,000. The program in Salt Lake City included free school lunches, vegetable seeds, and land for growing produce. As the food supply continued to dwindle, charities organized hunts to provide rabbit or venison for community soup kitchens. However, by the spring of 1932, less than three hundred dollars remained in Salt Lake City’s emergency fund.21 In the end, Utah, like the rest of the country, had no one left to ask for help.

That’s where the New Deal came in.  Per capita federal spending in Utah during the 1930s was ninth among the forty-eight states. The percentage of Utah workers on federal relief projects was far above the national average, and for every dollar Utahans sent to the nation’s capital in taxes, the government sent back seven dollars through various programs.

This example is so powerful because it shows the American citizen needs private organizations and the government to traverse extreme economic ruin.  Utahans were creative, connected, and persistent.  Even their best efforts, however, needed some outside assistance.

As of Apr. 4, 2020, nearly 10 million Americans have filed for unemployment.  Ideally, many Americans will regain employment after social distancing standards are relaxed, but realistically many of those jobs will have gone away.  As for housing, even the best protections for tenants and home-owners expire within a year.

What Can Be Done Now?

While working in debt restructuring, I learned the principle that your first loss will usually be your least loss.  It is my opinion that the housing industry would be better off if landlords and mortgage holders waived 90 to 120 days of mortgage payment and rental payments.  This number would probably be our least loss as the landlords and lenders will most likely receive large bailouts.  Keeping the tenants and homeowners financially healthy is better for everyone in the long term and would likely be far more effective in solving the financial crisis.  We need to pull together as fellow citizens and coordinate with existing private organizations to find and assist those in need.  We also need more from our government.  Implementing a “New Green Deal Employment Project” to help citizens out of work pull themselves back to financial stability would not only improve national infrastructure but stabilize the economy as a whole.



Long-time banker and broker, James M. Nelson, noticed rental rates sky-rocketing across America and sought to discover the cause. He recently published a book detailing his findings, Stealing Home: How Artificial Intelligence Is Hijacking The American Dream.





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