Fany Sarmiento moved to Durham two years ago, settling into Garden Terrace Apartments in Lakewood. She had been living in New York City, and it seemed like Durham would offer a better life. It didn’t.
“It’s starting to be more and more like New York all the time,” she says in Spanish, through a translator. “In a lot of ways, it’s even worse because there aren’t really laws to protect tenants.”
With COVID-19, it got even harder for families like the Sarmientos. She left work to care for her children; others moved into hotels or spent all their savings. There was already an evictions crisis in the area. Now there’s a looming catastrophe.
“The pandemic has changed everything for us,” Sarmiento says.
But not everyone in the Triangle is struggling. Homeowners have watched their wealth grow as a mix of historically low interest rates and other factors have driven home values up more than 20 percent in the past year, according to data from the Multiple Listing Service. They can cash in on a highly competitive market where buyers are putting in offers on not-yet-listed homes, sight unseen.
“Now, it’s not uncommon to have multiple offers on coming-soon status houses,” says Courtney James, managing partner of Urban Durham Realty.
These experiences are the lived reality of what wonks call a “K-shaped recovery,” in which different parts of the economy recover from a shock at different rates.
Now, that recovery means inequality that was growing before the pandemic—between renters and owners, white and blue or pink collar, white people and people of color—is only accelerating.
In response, activists are only getting more ambitious. How their fight plays out in the next few years may set the stage for the future of the Triangle.
But first, we have to survive the present.
“It’s like asking about the future of shipbuilding on the deck of the Titanic,” says Roberto Quercia, a city planning professor at the University of North Carolina at Chapel Hill and author of A Place Called Home: The Social Dimensions of Homeownership. “There is just not a lot of perspective.”
Even with vaccinations well underway and the $1.9 trillion relief bill recently signed by President Joe Biden, the economic recovery from the pandemic will take until the middle of the decade, Quercia says. Triangle residents dealing with lost wages, healthcare costs, back rent and utility bills, and other fallout will need support long after the medical catastrophe subsides.
Evictions are the most pressing problem.
“We know from research that home instability is hugely important to the development of children,” Quercia says. It’s also a public health issue “closely connected to declines in physical and mental health,” according to the Centers for Disease Control and Prevention.
Keeping people in their homes is the most cost-effective way to improve social well-being. Two years ago, a hospital in Chicago found it cheaper to simply pay some homeless patients’ rent than it was to continually treat the medical issues that arose from unstable housing.
“The pandemic, if nothing else, has made these cracks in our safety net obvious,” Quercia says.
But it also tends to expand them.
“The vast majority of our clients have continued to be very low-wealth families who have been stuck in a historic cycle of poverty,” says Peter Gilbert, the director of Legal Aid’s Eviction Diversion Program, noting that the program’s clients are disproportionately Black and disproportionately have a single mother or grandmother as head of the household. “For them, this economic crisis is not a new experience, but it is worsened and deepened by COVID-19.”
That’s why large-scale—and previously unthinkable—policies like direct rental assistance payments and evictions moratoria are especially important. Unfortunately, they are also marred by uneven implementation and poor design.
“The pandemic, if nothing else, has made these cracks in our safety net obvious.”
While federal and statewide evictions moratoria have substantially decreased the number of evictions filed in the court system, unofficial evictions are still happening outside of the courts, Gilbert says.
“[We’ve observed in our clients] many folks are being pressured to move out by their landlords,” he explains. “Landlords are calling them every day, saying ‘if you don’t pay the rent, you’ve got to move.’”
They don’t, but many tenants aren’t aware of their rights. And some are rightly afraid that forcing a court action will impede their ability to secure housing in the future, since many landlords use past eviction filings to screen potential tenants—sometimes even when the court ruled in the tenant’s favor.
Compounding that problem is the fact that housing relief policies place the burden of enforcement on those under threat of eviction, says Bill Rowe, general counsel and deputy director for advocacy at the North Carolina Justice Center.
The initial federal policy set by the CDC last year required anyone who wanted protection under the moratorium to fill out a declaration form then provide it to their landlord, who would, hopefully, refrain from filing an eviction. It was confusing for renters, landlords, and even the courts, Rowe explains.
Though the statewide moratorium Gov. Roy Cooper signed simplified things somewhat, problems linger. Tenants still have to sign the declaration form, and it’s only for those who meet certain income requirements.
“It would be nice to have what other states have, which is a straight moratorium: no evictions for nonpayment of rent,” Rowe says. “That makes it easier. If somebody comes into the courthouse with an eviction paper because somebody is behind on rent, they can’t do it.”
Rental assistance programs saw similar problems. A Durham program that used federal funding to pay rent and utility bills required residents to fill out 11 separate forms within a 20-day window or their claims were denied.
“That meant most people were denied, because most people couldn’t figure out and fill out 11 separate pieces of paper correctly within 20 days, because there was no assistance to do that,” Gilbert says. That may be by design, as Republicans continue to handicap the programs with additional restrictions.
Most assistance programs also leave out Triangle residents with unstable housing situations, the people who most need them. Renters with unofficial agreements or subleases and those with month-to-month leases are ineligible for assistance. Canceling a month-to-month lease or raising rent at the end of a rental term aren’t regulated under the eviction moratorium as canceling the agreement or raising rents isn’t technically an eviction without a signed lease. Residents can be priced out of their homes without legal recourse.
It’s those situations that Sarmiento, speaking on behalf of the Garden Terrace Tenants Union, says show the real problem.
Sarmiento explains that one union member lived in the same apartment for six years without an official lease, but when the union asked the landlord to provide one so that the tenant could get rental assistance, it came with a $200 rent increase.
“Our landlord is in his house, just comfortable,” Sarmiento says. “He knows that we’re in a totally different world, a totally changed world. And it doesn’t seem to impact him.”
But even ensuring those people are covered under assistance programs might not be enough. Though the state already has $700 million set aside for rental assistance and more coming from the $50 billion dedicated to housing costs in March’s American Rescue Plan Act, the need is even more extraordinary.
A U.S. Census survey recently found that nearly a third of adults in North Carolina live in households “where it has been somewhat or very difficult to pay for usual household expenses.”
Based on census data estimates, covering a single month of those expenses in the Triangle alone would cost nearly $250 million, and activists emphasize that residents need help with back payments since the pandemic began.
“If you combine all the affordable housing from all the nonprofit groups in Durham, it still won’t be enough.”
While the Triangle’s poorest residents are struggling, the wealthy are claiming ever-more expensive houses and apartments, including newcomers powering the region’s growth—the engineers, for instance, who will likely come for jobs at Google’s new hub in Durham.
COVID is just accelerating this process.
Because of the scant and uneven protection North Carolina tenants have, the pandemic offers an opportunity for landlords and investment companies to increase their profits. Gilbert notes that many landlords have rejected payments from assistance programs like HOPE because it was better for them financially.
“They were more interested in being able to re-rent the unit to a new tenant at a higher rate than in keeping their current tenant, even if they could pay off their balance with government assistance,” he says.
While early reports of a mass exodus from cities across the country appear to be overstated, there is evidence that large metro areas like New York and San Francisco have seen increased out-migration. And the Triangle was a popular destination for transplants. Armed with higher wages, working alongside white-collar locals who have enjoyed recent economic growth, those buyers are willing and able to pay higher home prices.
“Most of our agents said they are working with a little bit more out-of-state buyers than average,” says James of Urban Durham Realty. Her anecdotal survey also found that New York, Colorado, Florida, California, and Washington D.C were the most common locations from which buyers were moving. She also notes an uptick of small-time investors from out of state looking to cash in on the region’s popularity.
The increased demand creates other dangers, too. James notes that associated fees have doubled and time on the market has been cut by a third. Buyers are also expected to write letters to the seller—something James said is “ripe for Fair Housing Act violations.”
“We’re making it difficult for first-time home buyers or buyers that are looking for more affordable homes,” says James, who serves on Durham’s Affordable Housing Implementation Committee. “It’s going to have to be non-market forces that help these buyers. The market is not going to do it.”
But nonprofit and affordable housing developers say their hands are tied.
“If you combine all the affordable housing from all the nonprofit groups in Durham, it still wouldn’t be nearly enough,” says Selina Mack, the executive director of the Durham Community Land Trust, which owns 282 affordable units. “Nonprofits cannot build our way out of the need for affordable housing. We’re going to need help from the private sector.”
Everyone is at the mercy of a market that is driving up prices. Land costs are rising, and lumber costs, which have doubled nationally since 2020, are driving up the cost of construction. As a result, everyone has to charge more to keep projects financially viable, and the largest for-profit developers have such deep pockets that they outbid everyone else.
While some zoning deals could be struck that create units affordable to residents making 80 percent of the area median income (AMI)—which for Durham and Orange counties was $72,700 for a family of four in 2020 and $75,300 for Wake County—it’s increasingly hard to make it affordable to those making 50 percent AMI ($45,450 for Durham and Orange, $47,050 for Wake) and below, considered the area of real need.
“That’s going to require a subsidy,” says Rowe. “An owner could not produce the housing for those folks.”
Those market conditions are one reason why popular housing policies, such as Raleigh’s recent accessory dwelling unit policy, have had so little impact.
“Boulder, Colorado, tried this some time ago,” Quercia, the city planning professor, says. “They found that instead of a single $500,000 house in a single-family lot, they had two $500,000 houses in a single-family lot. You can build more that way, but I’m not sure how much of it will become affordable.”
The COVID upheaval has led to other developments that can seem like quick fixes. If the much-vaunted work-from-home revolution comes to fruition, there may be unrentable office space that could be converted to residential spaces. But activists say it’s hard to tell if those projects could be viable for affordable housing, given the costs of conversion, as well as different infrastructure needs for homes, such as transportation, nearby food, and different utility requirements. The high price point of other converted buildings, like Durham’s American Tobacco or Raleigh’s Caraleigh Mills, gives evidence that it actually may fuel gentrification.
“It is very tempting to want to come up with creative or technological fixes for the lack of affordable housing,” says Gilbert. “Whether it is tiny homes or housing people in hotels or perhaps converted storefronts. But I think there is not a quick and easy fix.”
Despite the dire outlook, affordable housing advocates are cautiously hopeful, in that the pandemic has spotlighted existing problems in ways that make them unavoidable.
“This crisis has demonstrated the ways that housing is so integral to our public health and the basic functioning of our economy and society,” says Nick MacLeod, organizing director for the North Carolina Housing Coalition. MacLeod and others see an opportunity to make a transformational change.
Like all local politics in North Carolina, the immense power the General Assembly wields over city and county governments constrains what’s possible. Republicans at the state level have long passed laws limiting aggressive policies like rent control, along with more mundane strategies like impact fees. An unfriendly court system has added to the confusion, making city and county lawyers cautious about passing policies that are standard elsewhere in the country—such as inclusionary zoning—and worried about expensive lawsuits they might not win, even when they have a strong case.
But the appetite to think boldly has grown as the country gets used to direct stimulus payments, increased unemployment insurance, and other COVID-driven assistance.
“It does feel like there is so much more space that’s opened up,” MacLeod says. “We’re reckoning with the scale of this crisis in a new way.”
New options include using housing funds—from COVID relief or the housing bonds passed across the region in recent years—to aggressively expand the legal protections renters have. For instance, they could be used to guarantee a lawyer for any tenants going to eviction court, vastly increasing the costs of evictions for landlords.
Several policy changes are back on the table, too. Charlotte is exploring a law prohibiting source-of-income discrimination, which would make it illegal for landlords to refuse tenants because they use Section 8 vouchers. Doing so would solve a long-standing problem contributing to the affordable housing shortage. Cities and counties could also refuse to provide local funding in development deals unless developers agree to eviction protections for their tenants.
The fact that we’re in a state of emergency may also open up new options. North Carolina law says that local governments that declare a state of emergency can essentially do whatever is “reasonably necessary” to maintain order and protect people and property. That broad power may mean that Triangle cities could pass their own evictions moratoria, simplifying the process and ensuring that they last until the pandemic’s economic fallout ends.
It’s unclear whether that policy would survive a court challenge, in part because it is untested. But activists say there’s a case for it.
“I’d like to think any city can do what it needs to do to protect its citizens when there’s a state of emergency,” Rowe says. MacLeod agrees, adding he doesn’t think state law prohibits a local moratorium.
That option could disappear quickly, though, as the General Assembly could pass a law limiting local state-of-emergency powers at any point. In fact, Republicans are currently trying to do just that to the governor, in retaliation for his COVID policies.
What makes all of those options possible—and what’s at the root of activists’ hope—is residents pushing for them.
“There are a couple pieces that are always open questions,” MacLeod says. “One is how much political will are elected officials willing to take. Two is how much are we effectively organizing, both because it helps push elected officials, but also because when they have backup, they can feel better stepping out on a limb to do something [without] precedent.”
Sarmiento and her union show how much organized neighbors can do on their own. In addition to fighting to keep their neighbors in their homes and forcing inspections to fix long-standing issues, Garden Terrace Tenants Union is trying to organize a single, collective lease for all of its members, vastly improving individual bargaining power with the landlord. It won’t be a short fight, and addressing the inequalities across the rest of the Triangle will be even longer. But Sarmiento is confident.
“If we continue to fight, we will be able to win something here,” she says. “I know we have fewer rights here than we have in New York City, but some people think we don’t have any rights at all, and that’s not true either. We started talking to neighbors about what rights we have and how we can fight for more. Now, we see people with less fear moving forward with strength and courage.”
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