Wall Street’s latest real estate grab has ballooned to roughly $60 billion, representing hundreds of thousands of properties. In some communities, it has fundamentally altered housing ecosystems in ways we’re only now beginning to understand, fueling a housing recovery without a homeowner recovery. “That’s the big downside,” says Daniel Immergluck, a professor of urban studies at Georgia State University. “During one of the greatest recoveries of land value in the history of the country, from 2010 and 2011 at the bottom of the crisis to now, we’ve seen huge gains in property values, especially in suburbs, and instead of that accruing to many moderate-income and middle-income homeowners, many of whom were pushed out of the homeownership market during the crisis, that land value has accrued to these big companies and their shareholders.”
Before 2010, institutional landlords didn’t exist in the single-family-rental market; now there are 25 to 30 of them, according to Amherst Capital, a real estate investment firm. From 2007 to 2011, 4.7 million households lost homes to foreclosure, and a million more to short sale. Private-equity firms developed new ways to secure credit, enabling them to leverage their equity and acquire an astonishing number of homes.
The Great Wall Street Housing Grab
Hundreds of thousands of single-family homes are now in the hands of giant companies — squeezing renters for revenue and putting the American dream even further out of reach.
Francesca Mari, NYTIMES
In California, more than 100,000 people sleep on the streets. The tent cities in Los Angeles’s skid row have distinct neighborhoods, and across from a homelessness center, the bodies on the sidewalk are four rows deep. Trailers line the streets near Google’s Mountain View headquarters, and in Modesto, a woman sleeping in a cardboard box was crushed to death by a front loader that came to clear her encampment away.
Francesca Mari, NY Times
Fighting for Housing in America
By Conor Dougherty
To better understand how rents and affordability have changed over time, Apartment List analyzed Census data from 1960 – 2014. We find that inflation-adjusted rents have risen by 64%, but real household incomes only increased by 18%. The situation was particularly challenging from 2000 – 2010: household incomes actually fell by 7%, while rents rose by 12%. As a result, the share of cost-burdened renters nationwide more than doubled, from 24% in 1960 to 49% in 2014.
Andrew Woo, How Have Rents Changed Since 1960?
The population of the U.S. on April 1, 2000 was 281,421,906
The nation’s population was 328,239,523 in 2019, growing by 0.5% between 2018 and 2019, or 1,552,022 people.
Labor force participation rate
January 2000 – 67.3
January 2019 – 63.2
Housing units (thousands of units)
April 1, 2000 – 116,047
October 1, 2019 – 140,074
2000 – $5.15
2019 – $7.25
Federal Debt: Total Public Debt as Percent of Gross Domestic Product
Q1 2000 – 57.72
Q1 2019 – 104.40
Mr. Newsom campaigned on a promise to usher in reforms that would lead to the construction of 3.5 million housing units by 2025. That output would be more than quadruple the current rate, and the governor has started referring to it as a “stretch goal.”
California is not only well behind that pace, but the number of housing permits has actually turned downward — hovering around 100,000 units in 2019 — despite a strong economy and a median home value, $556,000, that is more than twice the national figure.
It is hard to overstate the threat posed to the state’s economy and prosperity. Housing costs are the primary reason that California’s poverty rate, 18.2 percent, is the highest of any state when adjusted for its cost of living, despite a thriving economy that has led to strong income growth and record-low unemployment.
California, Mired in a Housing Crisis, Rejects an Effort to Ease It
A lawmaker’s push for denser development near transit, overriding local zoning, was thwarted by a diverse group of legislative foes.
Conor Dougherty, NYTIMES
Listed at $1,005/month, this studio apartment is located at 1431 Humboldt St. South.
In the apartment, you can expect a dishwasher. Amenities offered in the building include a resident lounge and on-site laundry. Pet owners, take heed: This property is both dog-friendly and cat-friendly. There’s no leasing fee required for this rental.
Walk Score indicates that the surrounding area is a “walker’s paradise,” is convenient for biking and offers many nearby public transportation options.
If you would like to help out, you can donate here:
Colorado Coalition for the Homeless
“Rent is obscene here”: The issues forcing people in Seattle onto the street
Anderson Cooper visits a tent city in the Seattle area and hears from some of America’s more than 500,000 homeless people
Tricia Wood: I used to be one of those people that thought that if anyone was homeless they just needed to go get a job. That would solve their homeless problems.
Anderson Cooper: How would you answer that question now? Why can’t they just get a job?
Tricia Wood: Oh my goodness. Maybe they have a job.
Josiah Wood has a full-time job. He gets up before dawn and takes mass transit to work as a maintenance supervisor at the Hard Rock Café downtown. Though he makes $19.50 an hour, the rent for an average one-bedroom apartment in Seattle would eat up half his salary. He and Tricia say they’ve been saving up money so they can afford a security deposit and monthly rent.
Anderson Cooper: How long do you think you’ll keep living in the tent city?
Tricia Wood: I would hope we are out of here by winter.
Here’s one take:
“Stephen, you’ve been proven right on housing, and I think you’re about to be proven even more right. The most important driver of home prices is supply and demand. And right now, there is a chronic undersupply of homes in America.”
Census Bureau data shows an average of 1.5 million homes were built each year since 1959. Yet since 2009, just 900,000 homes have been built per year. In fact, fewer homes were built in the past decade than in any decade since the ‘50s!
We have a serious housing shortage in America today. It would take less than six months to sell every existing home on the market…
The Biggest Housing Boom In History Has Just Begun
Stephen McBride, Forbes
California, the country’s wealthiest and most populous state, also has the most homeless, an unremitting crisis that has confounded the state’s political leaders for decades and exposed one of the most extreme manifestations of economic inequality gripping the country.
Tent encampments — Oakland city officials count 90 of them — are now as much a part of the landscape as the bars and restaurants that cater to the city’s rising affluence. Many Americans are one medical emergency, one layoff, one family disaster away from bankruptcy or losing the roofs over their heads.
I was driving around Downtown Denver earlier today and drove past three people sleeping on the street, a few blocks from the ballpark. They didn’t have much baggage – no tents or sleeping bags, and one of them was in a large electric wheelchair. You see a lot of homeless people in Denver so I might not have registered these three, but that I had read this article earlier in the day, and I can’t see how someone survives being homeless in an electric wheelchair.
CONTINUING SHORTFALL IN SUPPLY
Just as the recent housing downturn was longer and deeper than any other since the Great Depression, the residential construction rebound has been slower. Since reaching bottom in 2011 at just 633,000 new units, additions to the housing stock have grown at an average annual rate of just 10 percent. Despite these steady gains, completions and placements totaled only 1.2 million units last year—the lowest annual production, excluding 2008–2018, going back to 1982.
The sluggish construction recovery is in part a response to persistently weak household growth after the recession. On a three-year trailing basis, the number of net new households dropped below 1.0 million in 2008 and held below that mark for seven straight years, including a low of just 534,000 in 2009. By comparison, even through the three recessions and large demographic shifts that occurred between 1980 and 2007, household growth still averaged 1.3 million annually and only dipped below 1.0 million once.
With the economy finally back on track, household growth picked up to 1.2 million a year in 2016–2018, close to expected levels given the size and age composition of the population. But new construction was still depressed relative to demand, with additions to supply just keeping pace with the number of new households (Figure 1). As a result, the national vacancy rate for both owner-occupied and rental units fell again in 2018, to 4.4 percent, its lowest point since 1994.
JOINT CENTER FOR HOUSING STUDIES OF HARVARD UNIVERSITY
In Minneapolis, in order to afford the city’s median monthly mortgage payment of $1,228, homeowners must earn a minimum annual income of $49,122. The average price of a home in Minneapolis is $250,779.
In Denver, in order to afford the city’s median monthly mortgage payment of $1,725, homeowners must earn a minimum annual income of $68,983.
The average price of a home in Denver is $352,172.
In Boston, in order to afford the city’s median monthly mortgage payment of $2,384, homeowners must earn a minimum annual income of $95,344.
The average price of a home in Boston is $486,752.
In San Francisco, in order to afford the city’s median monthly mortgage payment of $5,052, homeowners must earn a minimum annual income of $202,094.
The average price of a home in San Francisco is $1,032,732.
A portrait of one of the few remaining men only ‘flophouses’ on New York City’s infamous skid row, the Bowery.
Ray: Once you take the cherry out of life. Once you take your wife, or your love or however….the cherry, life ain’t nothin man. It ain’t nothin man. You’re a zero, and everything else you’re doing is just fucking around.
Nathan: You haven’t lived until you’ve been in a flophouse with nothing but one lightbulb and 56 men squeezed together on cots. With everybody snoring at once, and some of those snores so deep and gross and unbelievable dark, snotty, gross subhuman wheezings from hell itself. Your mind almost breaks under those deathlike sounds and intermingling odors of hard, unwashed socks, pissed and shitted underwear. And over it all, slowly circulating air much like that emanating from uncovered garbage cans. And those bodies in the dark, fat and thin and bent some legless, armless. some mindless. And worst of all, the total absence of hope. It shrouds them and covers them totally. It’s not bearable. Those men were all children once. What has happened to them? And what has happened to me? It’s dark and cold out there.
To count the unhoused and unsheltered population—the shelters are usually full to bursting with waitlists hundreds or a thousand names long—county health or human services agencies, or nonprofits to which the task is contracted out, often resort to the simplest method of enumeration known, the one you learn in kindergarten: They (or citizen volunteers, mostly) go out with flashlights, clipboards and pencils, and literally count heads, or curled-up street sleepers, or RVs, or tents.
How many people an office manager or sales rep guesses are sleeping in an RV or a tent they’re peering at in the semi-dark becomes data. Whether the volunteer presumes two or four is up to them—I can tell you this, for I have done it twice, in 2009 and 2017, and I don’t believe my guessing skills improved much—and thus wholly arbitrary, a snap decision that can result in a variance of 100 percent. Or more. Is that just some old car, or an old car someone lives in? Is that RV the glamping vehicle for an Instagram influencer or some eccentric Burner type, or does it house the family of four who couldn’t afford the landlord’s latest offer? You don’t know and you can’t know. Yet, this is the data the federal government uses, and we arrive at neat numbers like, “500,000 homeless people in America, 8,011 homeless people in San Francisco.”
How California’s Homeless Crisis Grew Obscenely Out of Control, Chris Roberts, Observer.com
From 2010 to 2017 the greater San Francisco Bay Area added 546,000 new jobs but only 76,000 new housing units. Where did civic leaders think these hundreds of thousands of additional people would live? California, which has the nation’s worst statewide housing crisis, needs to built 180,000 units a year just to keep up with population growth. Yet in no year from 2007-2017 did the state build even 100,000 units.
Shaw, Randy. Generation Priced Out