Short-Term Benefits of Emergency Rental Assistance Extend Beyond Housing
Since it was enacted at the end of 2020, the federal Emergency Rental Assistance (ERA) program has helped millions of renters get caught up on rent payments. An analysis I did for a new working paper, "The Short-Term Benefits of Emergency Rental Assistance," finds that this assistance is also associated with improved financial well-being and mental health. While many ERA recipients still have difficulty meeting household expenses, they are much less likely to be behind on rent, to borrow from friends or family, to experience food insecurity, or to report poor mental health.
The Emergency Rental Assistance program was created to support renters with low incomes who experienced financial hardships or job losses during the pandemic and are at risk of homelessness or housing instability. The Consolidated Appropriations Act allocated $25 billion to the program on December 27, 2020 with an additional $21.55 billion provided through the American Rescue Plan Act on March 11, 2021. Nearly 60 percent of these funds have been spent to date, and the program has helped with more than 5 million rent and utility payments.
To examine the outcomes associated with ERA, I use the US Census Bureau’s Household Pulse Survey from weeks 36–44, a period that encompasses August 18, 2021 through April 11, 2022. The survey asked respondents about whether they have applied for ERA. Using descriptive statistics, logistic regression models, and propensity score matching, I compare renter households who received ERA (recipients) with those who applied but were still waiting to hear if they’d been approved (applicants). The analysis highlights the benefits associated with ERA across eight self-reported outcomes in the survey.
ERA recipients were less likely than applicants to report housing, financial, or mental health stresses (Table 1). Notably, just 25 percent of recipients were behind on rent at the time they were surveyed, compared to 65 percent of applicants. Even with ERA, 67 percent of recipients had difficulty meeting their expenses, but this is considerably lower than the 85 percent of applicants. Recipients also reported lower rates of tapping their savings or borrowing from friends and family and experienced a greater degree of food security. Mental health was again a significant concern for both groups, but about two-thirds of applicants reported at least one mental health issue at least half the days of the two weeks before they were surveyed. In contrast, half of recipients had anxiety, worry, depression, or little interest in things.
Table 1: Share of ERA Recipients and Applicants with Each Outcome (Percent)
|Behind on rent||Eviction somewhat likely (if behind)||
3+ months behind (if behind)
|Difficulty meeting expenses||Tap savings or assets||Borrow from friends or family||Food insecurity||Poor mental health|
The descriptive findings point to differences in outcomes between recipients and applicants that are further confirmed in the logistic regression models that control for other household characteristics. Propensity score matching provides another layer of controlling for these characteristics. By matching recipients to similar applicants, the method lends itself to greater causal inference and can be used to identify average treatment effects. The average treatment effect of receiving ERA is largest for the housing outcomes, including a 36-percentage point decrease in the likelihood of being behind on rent (Table 2). The effects across the financial well-being indicators were also substantial, ranging from a 4-percentage point difference in the likelihood of tapping savings or assets up to a 13-percentage point difference in having difficulty meeting expenses. ERA receipt was also associated with a 7-percentage point reduction in the chance of feeling anxious, worried, depressed, or having little interest.
Table 2: Average Treatment Effects of Emergency Rental Assistance
|Average Treatment Effect (ATE)|
|Behind on rent||-0.36||***|
|Eviction somewhat likely||-0.14||***|
|3+ months behind||-0.20||***|
|Difficulty meeting expenses||-0.13||***|
|Tap savings or assets||-0.04||***|
|Borrow from friends or family||-0.11||***|
|Poor mental health||-0.07||***|
Across each of these analyses, emergency rental assistance is associated with substantial benefits for housing stability, financial well-being, and mental health. ERA recipients are less likely to be behind on rent and by having at least a portion of their owed rent and utilities covered, recipients also seem to have relief from other financial pressures. The range of benefits associated with ERA are especially important to consider as funds go unspent in some places and run out in others. Even with the reallocation of funds that started in the fall of 2021, the program is temporary and finite by nature while many renters are experiencing ongoing financial distress and housing instability. Sustained, reinforced assistance through emergency programs and through existing rental housing subsidies will be needed to ensure that renters can remain stably housed.