What's behind the quiet rise of homelessness in the countryside? | Hacker News Reader

What's behind the quiet rise of homelessness in the countryside?

theguardian.com

52 pointsDoreenMichele65 comments

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Question:

Is some group is accumulating so much money that the poorest have insufficient money remaining for their basic needs?

Observations:

- Aggregate total wealth of all private households in Great Britain was £11.1 trillion (in 2014) [1]

- In the UK there were 27.2 million households in 2017, resulting in an average household size of 2.4. [2]

- This computes to an average wealth of £408,000 per household in the UK.

- According to the Office for National Statistics, as of November 2017, the average UK house price reached £226,071 [3]

Conclusion:

With perfect wealth equality, the basic needs for everyone living in the UK can theoretically be met. Therefore, it is possible that wealth accumulation may be a significant contributor to the homeless problem.

However, the gap between the cost of living in the UK and the average wealth in the nation is fairly thin. With a realistic Gini coefficient, a large portion of the population will have their basic cost of living exceed what their wealth can support. Adjusting the wealth distribution will reduce the size of the homeless problem, but not solve it.

The UK should seek to identify why its cost of living exceeds what this portion of the population can support and take appropriate action to resolve these issues.

Sources:

[1] https://www.ons.gov.uk/peoplepopulationandcommunity/personal...

[2] https://www.ons.gov.uk/peoplepopulationandcommunity/birthsde...

[3] https://metro.co.uk/2018/02/02/what-is-the-average-house-pri...

edit: There was a large flaw in my original logic -- the math was done per person instead of per household.

If everybody in the UK moved to where houses had average cost, everybody would be able to afford a place to live. If they could get a job, which they can't, which is (a large part of) why they don't do that.

That's the problem with averages.

The high cost of housing is caused by demand outpacing supply for a very long time. It's expensive to live in London because more people want to live in London than the housing stock will accommodate, and no amount of redistribution will change that, except to the extent such a policy makes it drastically less attractive to live in London.

The exact causes of the supply shortfall is subject to some discussion, but that the shortfall is the proximate cause of the high cost isn't.

The article is about countryside homelessness, not big-city homelessness. The problem with that average is that it overestimates the cost of countryside living, which means that people who are homeless in the countryside are seriously screwed, not "living in the wrong place".

The current trend is that more and more people can't afford below-average priced housing. This is a serious problem.

> average UK house price reached £226,071

Aren't house prices an aggregate of 'owned outright' via cash, inheritance, debt repayment and 'loaned against' in the form of bank loans against real estate? There's been a dramatic inflation in housing debt, worldwide, that first precipitated the financial crisis a decade ago, and that continues to overhang economies worldwide. It was observed a long time ago that 'the debtor is servant to the lender.' You can't look only at private household wealth, you have to look at bank balance sheets as well. I bet if you include bank balance sheets, you can find a 'small group accumulating so much money.'

If banks are accumulating wealth, which may very well be our reality, then this wealth would be reflected in the equity value of the bank itself. Thus, this wealth would still be reflected in the wealth of private households who had ownership in the bank. This would apply even if the banks were international, since the owners could still be citizens of the UK.

All true. However, UK bank share ownership doesn't necessarily correlate with UK citizenship. And, maybe more importantly, stock ownership is skewed heavily to a relative few, e.g. (US data) [0].

[0] http://www.nber.org/papers/w24085

> If banks are accumulating wealth, which may very well be our reality

It is.

> this wealth would be reflected in the equity value of the bank itself

It is.

> this wealth would still be reflected in the wealth of private households who had ownership in the bank.

It is.

What do you mean with all these "if" statements that are quantitatively true? Even stock markets are aggregators of wealth (focusing gains on a small population).

The point is that it doesn't matter who the accumulator is, only if the accumulation is to a detrimental degree. The Gini coefficient in the UK is already lower than most, and reducing it probably won't solve the homeless crisis there. I suspect the bigger contributor to the homeless problem in the UK is the cost of living increasing to an unsustainable level for a large portion of the population.

My point is that increase in the housing part of the cost of living is directly tied to the wealth created by the extremely relaxed mortgage lending environment of the last 15-20 years. If that debt were extinguished, house (and rent) prices would be lower for a relatively large population, and wealth would be destroyed for a relatively small (but powerful) number.

I think median house price would be a better statistic to use than average.

Housing is a positional good. The price is not about labor and materials, but about winning against the others who want the same house. Accordingly, housing prices respond to changes in the money/wealth available to pay them, finding whatever price level is necessary to match the number of households that can afford a unit to the number of available units. Increasing wealth across the board does not make more homes unless you also permit their construction.

Housing is not really a positional good. As a counterpoint, consider the extremes. If a market is saturated, the value of a house remains non-zero. If there is only a single house in an area, the value probably remains low since there is nothing else of value around it. Housing just more or less just follows a normal supply curve. Building more housing isn't going to cause the overall price to approach zero.

As a side note, with a healthy housing market a house would probably be a depreciating asset, like a car. This would have the side-effect of making those who put a lot of money into their home unhappy, and so homeowners have put a lot of effort into ensuring artificial restrictions leave the housing market in an unhealthy state that lines their pockets.

Getting affordable housing is possible, but it requires fighting the extremely entrenched mentality that a home is a form of savings that should always go up in value.

Poke around the Northwest Side of Milwaukee, vastly oversupplied for its current population and economic stature. I see a 5-bedroom apartment for $46k [0]. Sure it's not $0, but it's damn close as housing goes. (Note that this area is not particularly dense, just poor. But Tokyo shows us that we can also have rich areas dense enough to be affordable).

[0] https://www.zillow.com/homedetails/5748-N-36th-St-5748-Milwa...

As someone who owns a lot of houses, well the mentality that the house is the storehouse of value is not the only thing.

My family does not want to live where anyone can buy up a house. Yes, everyone likes less problems. But your ability to reduce problems depends on the resources you've available.

We want to live in the places where there are plenty of facilities, people rougly having same income level.

It's way easier to join and relate to the people who are at same level as you.

Housing cost is the best way to ensure these emotional aspects.

>It's way easier to join and relate to the people who are at same level as you.

This is a fine reason to want stable housing prices, but when the median resident bought their house for $200k 10 years ago, and the new neighbors are paying $2 million, you're also seeing a huge change in income level and all the cultural baggage that comes with it.

I like the thought process here (looking at aggregates), but this analysis is simplified to the point of uselessness. For example, since you are talking about houses I think the relevant quantity is average wealth per household. The average household size in the UK was 2.3 in 2011 [1], so that's £395,600 / household, reversing your conclusions.

I'm sure other considerations could push the results in both directions. To draw any conclusions from this type of analysis, one needs to think much more carefully about this question than either of us have done. Surely there must be economists who spend their careers addressing these types of questions?

[1]: https://www.ons.gov.uk/peoplepopulationandcommunity/populati...

It's not one person per house. By the premise of your calculation there is more than enough net worth.

Globalization and free trade benefit corporations, not workers, hence the increasing income inequality.

Corporations are pocketing the difference in labor pricing from off shoring labor rather than passing the savings onto consumers as was promised by politicians and economists when trade deals were signed.

Not just the UK, this happens in the US also.

http://tucson.com/news/state-and-regional/homeless-make-the-...

GDPR blocked for people in the EU. Google cache here: http://webcache.googleusercontent.com/search?q=cache:KnwGRKo...

I have friends that have lived in the national forest for a significant amount of time. Know people who live in cars and RVs in cities. None of them are mentally ill or drug addicts. I know techies and rednecks who are held back by the cost of real estate.

The world needs a modern homesteading act. Give people small parcels of land with limited restrictions.

Real estate speculation/investing/absenteeism has jacked up prices in a lot of areas. This excessive ownership by some is subsidized and allows rent seeking and perpetual wealth growth. Land is not capital. Land is limited. Bare land should be free.

> The world needs a modern homesteading act. Give people small parcels of land with limited restrictions

Or (more controversially) increased squatter’s rights.

Here in the UK I would settle for the reintroduction of squatter's rights. Tony Blair abolished them.

(To be completely accurate, you are still entitled to claim land after 12 years unchallenged adverse possession. What changed under Blair is you now also need the permission of the landowner. Which you will never get.)

19th-century homesteading happened before people expected minimal utilities to be connected to their property. Even if you give all that free space out there to people, what good is it without water or electricity?

It is cheaper to install solar than run electric. For under $2,000 I have built solar systems that power an efficient fridge, led lightbulbs, normal electronics, and the occasional power tool (even stick welding). Thats only ~2 years of power bills.

I've also made a well drilling auger and manually dug a drinking well for only a few hundred dollars in parts. Many offgrid people collect rainwater into a cistern and meet their water requirements. If these plots were small enough it wouldn't be unreasonable to have one well that supplies 10+ houses.

Interesting phenomenon. From the U.S. all I ever hear about the U.K. is urban: Londoners living precariously in houseboats, blighted post-industrial cities in the North. I've seen tent encampments in the woods in the U.S., but it never occurred to me that it would be a thing in the U.K. Until just now, if you'd asked me where the poor lived in the U.K., I would have said "council estates."

The UK has the equivalent of the US projects called Blocks (after the shape of the buildings). Featured in UK tv like The Misfits, Escape the Block, etc.

In absolute terms it's not a large number of people; the article says a few hundred, but undoubtedly they are undercounted.

"Tent cities" are an increasing problem. Council estates have been sold off gradually and are now seriously over-subscribed.

In the US, we dont associate homelessness with wealth but rather mental illness.

You can get a place to live for 400/mo dollars in the south, and easily 500$/mo with roommates in 'civilization' where there are high paying jobs.

None of this is particularly difficult to afford, even for minimum wage workers(who dont really exist).

I find this an odd topic. Living isnt hard to do in first world countries where food is plentiful, jobs pay decent, and getting space to live in is cheap.

It's easy to armchair theorize about how one should be able to pull themselves out of poverty, but it's not quite as simple as you make it sound.

Poverty/Homelessness is a cycle. Once you're in it, it becomes exponentially harder to climb out the longer you are in it. Even if you maintain your mental faculties, don't have a drug/alcohol problem, and are willing to work - doesn't mean you will find a job. In cities it is a bit easier to take the first job that comes up, but if you live in a rural area you are subject to geography. Maybe the only job that is hiring is 30 miles away and you can't get there because your car is broken down.

>>Living isnt hard to do in first world countries where food is plentiful, jobs pay decent, and getting space to live in is cheap.

I don't know your history but this seems like a comment made by someone who has never had to struggle for those things. It is absolute hard for some, just as it comes easily for others. Casting out blanket statements like this does nothing other than turn a blind eye to an issue.

I dont think you read my post.

It was about mental illness.

If your comment was about mental illness than you need to be more clear in your writing.

Either way, your point doesn't make sense.

If you are saying it IS a mental health issue, than pointing out how easy it is to find work and how cheap living is in rural areas has nothing to do with that point.

If you are saying it is NOT a mental health issue, then my counter arguments stand. Poverty is a cycle that affects even those with good mental health.

I believe his argument is this:

1. Cheap housing exists ($400-500/mo)

2. Minimum wage jobs are readily available in the areas that the cheap housing exists

3. Working a minimum wage job and living in said areas is preferable to being homeless

4. The primary reason someone might choose not to, or be unable to, take that path is mental illness

5. Therefore, homelessness must be a mental health problem

There are a number of ways to attack this, but "ease of finding housing and jobs" is actually relevant to his argument - namely, that because such opportunities exist and the homeless are not taking them, there must be something preventing the homeless from taking them (and that something is mental illness)

> In the US, we dont associate homelessness with wealth but rather mental illness.

Probably because when we see a visibly homeless person, they are also very obviously mentally ill. There are lots of "invisible homeless" - in the sense that they don't look homeless, because they're not pushing a shopping cart around, aren't nursing oozing sores, and don't smell like they haven't bathed in two weeks.

Last fall, I was walking in my neighborhood and saw a woman asleep in her car. She didn't look like she pulled over to take a nap because she was too tired to drive safely; she looked like she was living in her car. But she looked just like any other person you'd pass in the street.

So, you're right, but it doesn't mean that homelessness-due-to-poverty doesn't exist.

This is actually a really important distinction that I think is lost when people argue about the homeless problem.

I think most people who have a problem with the homeless, myself included, are speaking primarily about people living on the street and very obviously either A) addicted to drugs, or B) mentally unwell. Whereas it seems that people who advocate for the homeless are advocating mostly for people who have fallen on hard times and are struggling to get by.

FWIW, I don't think people who are anti-homeless really have much of a problem with somebody who is sleeping in their car because they're struggling financially. But we do have a problem with people who live out of their car because drugs and/or mental illness render them unable to participate productively in society.

What? I think most people who advocate for the homeless are advocating for the full spectrum of people. Most of the homeless - addicted, mentally ill, down on their luck, etc - aren't really there by "choice" in any meaningful meaning of the word.

Most of the advocacy I've seen specifically points out that the majority of homeless are not the people you see on the street. Meanwhile, just about 100% of the outrage I see on FB and Nextdoor is directed at the people you see living on the street.

Ah, the good old deserving/undeserving poor distinction. You say yourself that their "mental illness render them unable to participate productively in society", which is true - so why is this their fault?

It's not their fault, but their presence is still disruptive and unpleasant.

There's a difference between thinking people should not be allowed to do whatever they want just because they're homeless and thinking that they are underserving of compassion and help. FWIW, I said nothing about the latter.

> FWIW, I don't think people who are anti-homeless really have much of a problem with somebody who is sleeping in their car because they're struggling financially.

It only takes one person to file a complaint to the police about someone living in a vehicle on their street. It is, de-facto, a crime in most cities.

I would be very interested in seeing listings for $400/month. If you would be so kind as to give me links to such, I would be grateful and it might even help get a few homeless people off the street.

These places are just an internet search away.

https://hotpads.com/windsor-apartment-homes-abilene-tx-79601...

https://hotpads.com/sugar-creek-apartments-wichita-ks-67210-...

https://hotpads.com/newton-village-newton-falls-oh-44444-skz...

You can definitely rent a room in an apartment in NYC for that much. It's probably not going to be very nice, you'll be far from the city, and you are subject to roommates.

https://www.apartments.com/559-vincent-ave-bronx-ny/0kg0371/

https://detroit.craigslist.org/d/apts-housing-for-rent/searc...

Its not the south, but its detroit craigslist.

I see 2 ads for 500 dollars on the front page, both mention multiple bedrooms.

Have you tried craiglist in rural areas?

I'm specifically hoping to find listings at $400. I have found two cities with listings at about $500 or a bit less. I have done internet searches trying to find places at $400 or less and things that look at first blush like they meet the criteria often turn out to actually be something else entirely, like an RV park.

Most places do not have apartments at $500 per month. I am willing to talk about how to find a roommate situation in that price range, but most homeless people have special needs, whether medical or mental health, that make them unsuited to a roommate situation or a roommate situation unsuitable for them.

I am interested in specific names of cities, websites with good search parameters for finding such and other general advice on how to get it that low. I've done a lot of searching and listings that are substantially below $500 are pretty rare in my experience.

I'm happy to be proven wrong. I would like to do a write up on one of my blogs for where you can find truly cheap housing if you have portable income.

Thanks to folks who have already replied. Feel free to shoot me an email with such info to avoid cluttering up this discussion too much.

I've rented housing in Nicholson, MS for around $200/mo. I worked at John C. Stennis Space Center, MS (a 200 square mile federal city with a huge buffer zone, nearest town is Nicholson, MS). You can find such these listings in local papers, but I don't think much of it is online.

It was not the best housing, but a 2 bedroom duplex (only 1 half of the duplex was included, that half had 2 bedrooms, I don't know how many bedrooms were in the other half). Trash, electricity, and water were not included in this price.

Thank you.

How recently was this roughly?

There are houses in my town going for $50k. For that you get 1600sqft, 2 bed, 2 bath, .36 acre lot in the city with city water and sewer. At the worst you would need to drive an hour to get a big city job, but there's plenty within a 30 min drive. Cleveland is about an hour away, Akron is 30 mins.

The locals that are homeless here are not in that situation because of some fixable problem with a city policy. It's unanimously mental illness or drug problems, often both.

This is also the county seat, and where the welfare offices are located. 80% of the properties in the city are rentals, and there are multiple charity organizations that provide discount housing.

Homelessness is not a problem that will be eliminated until we no longer have people that cannot take care of themselves.

If you have no down payment and lousy credit, etc, you can't get a mortgage for $50k. I'm off the street. I applied for a zero down mortgage. It would still require thousands in closing costs, money I don't have.

The bank never emailed me. I was unable to log in to my application for some reason to check it's status. I emailed a mortgage officer at the bank. They asked for my phone number. They never called me.

I have since decided I don't want a house in the burbs. I want to stay downtown. That's an entirely different process.

But I have earned income and decent credit and 6 years of college etc and I am finding it challenging to arrange to purchase real estate. I have had these conversations on HN before with people and it always seems to be an assertion that comes from privilege and cluelessness about what reality is like if your income is low.

I have done internet searches for dirt cheap housing across multiple states. The truly dirt cheap stuff frequently says stuff like "No foundation. Will not qualify for financing. Cash buyer only."

If I had a few $10k cash laying around, I would handily qualify for a conventional mortgage because that would cover down payment and closing costs. So, no, I can't buy the houses listed at a mere $10k or $20k that theoretically would have super low monthly payments because that just isn't how that works.

People who have challenges to taking care of themselves can sometimes manage it if they can arrange decent housing that is super cheap. I'm medically handicapped and I manage to work part time. I am currently in a super cheap rental and off the street.

I paid my student loan off last July and was in housing in early September. Student loans are a pox on this nation, impoverishing a great many people. You don't need to be mentally ill or addicted for that to be a huge and problematic burden.

I'm not asking you to solve homelessness. I'm just looking to crowdsource a little information. It would be nice if folks refrained from raining on my parade and trying to tell me to not bother to try to do anything about the problem.

Thanks.

Then you probably can't afford real estate right now, and need to either move somewhere with cheap rentals or find something cheap in your area.

I lived in a crappy apartment for 4 years while working my first real job to save up enough money for a down payment on a house.

I am currently in an extremely cheap rental. That's how I got myself off the street.

I bought a house at age 27 with zero down and no money to cover closing costs. I know something about wheeling and dealing in real estate.

The fact that I was recently homeless is not evidence that I don't know anything about real estate. I had student loans and a lengthy health crisis.

To be as clear as possible, I wasn't describing the issues I have run into in order to indicate that I personally can't pull this off. Just describing what can be involved and trying to indicate that it can be a dead end for a lot of people with a low income. I don't expect it to be a dead end for me, though it has proven to be a speed bump.

Canton?

> even for minimum wage workers(who dont really exist).

Minimum wage workers don't exist?

I have been trying to hire people for 8$/hr, 10$/hr, 12$/hr, finally I can hire people at 15$/hr.

Sure you might have some teens that dont realize they can make more than minimum wage, but thats about it. Ive meet moms that work for under minimum wage if they can watch their kid (work from home).

But these are not the homeless.

Its worth putting in context that my last job, a round trip commute into the downtown of the biggest local city regardless of pay rate would be $11.50 and about four hours by public transit or roughly $25 and a bit under 40 minutes in my car outside rush hour. There was a nice condo in walking distance to a former employer similar in quality to my house although a little smaller, that was only three times the purchase price of my house and the HOA fee was twice my current property tax, so yeah, not moving downtown. Also the "crime rate per thousand" stat is about four times higher downtown, I wonder how long my family or I would survive. Of course at $6500/year spent on my commute, a walking distance condo would become profitable after only 61 years of employment. The point being that even full time work is not terribly appealing at $15/hr if I have to work two hours per day just to break even on the travel costs to and from work. Or I could work 87.2 hours per week just to pay the mortgage on the condo using half my income toward housing, assuming no PMI but adding in the cost of HOA. Obviously I get paid a large multiple of that per hour, but I wonder if your labor market situation is similar.

Probably a reference to this sort of analysis: http://www.pewresearch.org/fact-tank/2014/09/08/who-makes-mi...

There are serious problems with actually getting to full-time minimum wage work; there's a lot of controversy over the so-called "zero hour" contracts where people are not guaranteed any minimum amount of shifts, and because the shifts are on-demand it's not compatible with another job.

(Having said that, all the example people mentioned in the article are there from forms of "mental health" issues; "mental breakdown"/abused child leaving 'care'/bad divorce)

Then there's the huge numbers of families in "temporary" accomodation. It's so bad that even the Grenfell survivors are in this state: https://www.theguardian.com/uk-news/2018/mar/29/100-househol...

What US do you live in? The one I live in definitely associates homelessness with poverty, as well as mental health issues. (The mental health issues are usually exacerbated by being homeless in the first place.)

I suggest you take a look at property and rental prices in the UK, and fuel, and public transport, then reconsider.

In the UK, for a single bed flat in an area with jobs you're looking at £1000 a month. You'll earn just over £12,000 a year on minimum wage - and there are plenty of minimum wage workers here - about 7% of working people.

The cheapest you will find a house to buy is about £90k - for a ruin, on Orkney. In a city, £200k+ - and you'd better have a 25% deposit if you don't want a penurious rate.

Gas is $7.90 a gallon, and that transport cost is reflected in most consumer goods.

This is not accurate.

I’m within walking distance of central London, and single rooms here are available for about £100/wk, and if you need a full one-bed flat it’ll be around £200/wk. A one-bed flat can be purchased for about 150k in the same area.

Property is substantially cheaper almost anywhere else in the country. In Glasgow, for example, £100/wk would cover the rent on a one-bed flat, and 50k can buy you a two-bed flat.

90% mortgages are available with interest rates under 4%, which is hardly punitive.

There are many problems with housing costs in the UK, but we don’t do anybody any favours without being honest about the numbers.

You're within walking distance of the City of London and it's £400 a month? I assume tower hamlets?

The cheapest room I can find in a flat share is £550 a month - although for the numbers you mention, you could rent an outdoor parking space.

http://www.rightmove.co.uk/property-to-rent/find.html?locati...

So yes, there are options that are cheaper than I posited, but it's still hardly the $400 a month for a house you see in the US.

To buy, for under £150k, all I can see is garages, boats, and sub-decade leaseholds - you can't live in a garage, a boat costs a fortune to maintain and moor, and a six year lease for £150k is a bum deal in my view, and not really ownership.

Would love to be proven wrong.

http://www.rightmove.co.uk/property-for-sale/find.html?locat...

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