More than 1,500 property owners are pursuing federal compensation, saying the pandemic eviction moratorium left them with unpaid rent, debt and lasting business impacts.
Source: Original report
Case moves forward as owners seek damages
More than 1,500 landlords have brought a federal suit arguing that the CDC's eviction moratorium during the pandemic deprived them of property rights and compensation. Plaintiffs include small owners and large portfolios, with claimed losses ranging from thousands of dollars to multi‑million dollar shortfalls. After losing at the Court of Federal Claims in 2022, they won on appeal and are now in settlement talks with the Justice Department.
How landlords describe the impact
Property owners say being unable to remove nonpaying tenants forced many to take on debt, delay maintenance, let go staff and, in some cases, sell assets. Some plaintiffs report losses that wiped out investors' returns and strained their businesses for years afterward.
- Owners say collections dropped sharply when tenants lost income and eviction filings were blocked.
- Several landlords say they borrowed to cover operating costs and property taxes.
- Many report tighter tenant screening and a reluctance to rent to higher‑risk applicants today.
Tenant advocates and relief programs
Opponents of the lawsuit argue the bans prevented evictions and reduced homelessness during a public health emergency. Researchers have linked state moratoriums to smaller increases in homelessness than would have occurred otherwise.
Federal emergency rental assistance — roughly $46.5 billion — also funneled money into rent relief programs. Critics of the landlords' claims say that assistance and other supports mitigated owner losses, although plaintiffs counter that funds arrived unevenly and did not always reach landlords promptly.
Examples from the litigation
The case includes a wide cross‑section of owners. One Texas investor who operates several hundred units says the moratorium produced a severe cash‑flow shortfall that persisted as recovery lagged. A long‑time small owner in Nevada testified she borrowed from federal small‑business loans to stay solvent after losing substantial rental income.
Longer-term market effects
Even years after the federal ban ended, landlords report durable changes in management practices. Eviction backlogs, tougher applicant verification and a higher tolerance for leaving units vacant rather than risk problematic tenants are among the adjustments cited by owners who say the policy reshaped their risk calculations.
What’s at stake now
Plaintiffs are seeking roughly $1.5 billion in aggregate compensation — an amount they say does not fully cover the industry’s losses. The Justice Department has declined to comment on the negotiations. If a settlement or court ruling favors the owners, it could establish a precedent on when government public‑health measures require compensation to private property holders.
Takeaways for stakeholders
- Landlords: the suit signals a push for government accountability where public actions had private financial effects.
- Tenants and advocates: the litigation raises questions about balancing emergency protections with property rights.
- Policy makers: the outcome could influence how future emergency housing interventions are designed and funded.
As the settlement talks proceed, both sides are highlighting competing priorities: protecting public health and housing stability on one hand, and addressing financial burdens borne by property owners on the other. The federal court process will determine whether compensation is owed and, if so, how it is distributed among the diverse group of plaintiffs.
