Issue 08: In a global pandemic, are people who pay the rent just April fools?
As governments prepare massive bailout packages for businesses, for those living on the edge of solvency a rent strike might be the online lifeline on offer
The COVID-19 pandemic has challenged global policy makers in ways unheard of in most of our lifetimes. This newsletter provides short, accessible briefings on as many of the relevant policy challenges as possible. Today’s briefing is written by Paisley Sim (PS), a graduate student at the Max Bell School of Public Policy who is riding out the pandemic in Montreal.
April 1, 2020
In economic time today is rent day. But in pandemic time the first day of the month is radically different than any other. With federal emergency benefits set to roll well after rent is due, many Canadians face financial peril. Covid-19 is a silo-breaking event that highlights the extreme precarity many renters live with. Today, global Keep Your Rent activists will refuse to pay their rent. Across Canada tenant activists are asking why, given the state of emergency, are tenants expected to pay rent at all?
With the federal government directive to shelter at home, along with other pandemic-fighting measures, looking to last for months to come a deeply changed economic future is beginning to set in. The Parliamentary Budget Office outlined a possible (but not inevitable) scenario where unemployment could rise to 15% in the third-quarter of 2020. Under the PBO’s modelling, real GDP growth could contract by 5.1%.
With nearly a million new EI claimants last month and the inevitable onset of a global recession, support for working people and renters is not an optional form of solidarity. Unprecedented fiscal and monetary policy action has been taken to protect both public health and the economy. As Cambridge University historian Anton Jäger writes “if 2008 consisted of dimming the lights after an electric fault, this is more like pulling the plug.” But putting the economy into a medically induced coma hasn’t put rents on hold.
Are landlords the only class of investor who expect not to be disrupted by the global economy tanking? The real message buried within rent strike action is the depth of the housing crisis in most Canadian cities. The Canada Mortgage and Housing Corporation considers housing affordable if 30% of an individual’s income goes towards rent. 49% of Canadians spend more than 30% of their monthly income on rent and a sixth spend 50% or more. One in five renters in Vancouver and Toronto pay over 50% of their income. Yet nearly half of all Canadians are less than $200 away from financial insolvency.
Mortgage holders have been offered a six-month payment deferral with interest continuing to accrue and payment expected to resume post-crisis. Renters are waiting for equivalent action.
Provinces have addressed some of the low-hanging fruit by suspending evictions and eviction hearings for between six and twelve weeks. B.C. has introduced a $500 rental supplement paid directly to landlords, (it is worth noting that the average rent for a one-bedroom apartment in Vancouver is closer to $1,500). B.C. and Manitoba have frozen rent increases. Once the state of emergency is lifted, back rent will be owed. What many rental activists are pushing for is a full rent moratorium.
Is now the time to strike?
Rent strikes are not called, they are organized. The danger associated with a hastily organized strike is increased threats of evictions and friction with landlords. Community organizers I spoke with acknowledge that tenant organizing can be more difficult than workplace organizing because you need a higher percentage of renters to make a lasting difference. Many renters are simply not in a position to risk their housing situation.
To succeed, a rent strike movement needs time for a democratic and centralized organizing body to assess the social, legal and market context of their community. Buildings in neighbourhoods such as Toronto’s Parkdale have previously organized successful rent reductions, but this kind of organizing can take months, if not years. Though digital organizing is hugely important, building local consensus and capacity is hindered when you can’t safely organize door-to-door.
It remains to be seen how many people withhold rent today because they are unable to pay or refuse to pay. What’s clear is that there is a strong movement to reassess the relationship between landlords and tenants given our very changed circumstances. Activists are calling for leniency and understanding.
Covid-19 has laid bare our affordability crisis. Toronto’s Federation of Metro Tenants’ Associations is running a highly visible rental strike campaign and over 744,000 people have signed a petition calling on the government to cancel rent and mortgage payments. Activists across the country are calling for the introduction of a permanent Universal Basic Income, increased shelter spaces for the homeless, and action that supports that housing is a universal human right.
What happens after April?
Social safety nets are woven in times of crisis. Governments have been given a rare opportunity to collect data and develop an accurate picture of the rental market, tracking real costs and rental unit density. Should the government offer mortgage and loan suspensions, it could create an incentive to register properties — such a registry would surely be useful for future housing policy. With accurate rental market data, governments can model different policy options, such as a density-bonus for those living in urban centres.
Rent is next due on May 1st — May Day, a day dedicated to celebrating the hard fought gains of working people. We should not be surprised to see rent strike action coalesce around May 1.
Related reading
Forget the jobs plan, just send Canadians a cheque, says Ken Boessenkool
It might take a while before history starts again, writes Anton Jäger in Damage
Governments Created the Housing Crisis. Here’s How They Can Fix It: Michal Rozworski in The Tyee
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Policy for Pandemics is produced and edited by Andrew Potter and co-edited by Charlotte Reboul and Paisley Sim (bios here) If you have any feedback or would like to contribute to this newsletter, please send an email to andrew2.potter@mcgill.ca