Eviction notice downloads soar after federal moratorium ends
lawdistrict.com
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Obviously we’re seeing more evictions now that they’re literally not banned. That’s not news. However, this is shocking:
> The rates of evictions served are approaching pre-pandemic levels in certain areas.
If eviction rates are “approaching pre-pandemic levels” then isn’t the real shocking headline that eviction rates are lower than before the pandemic despite the eviction moratorium? What am I missing?
Home is the only shelter many people have from contracting COVID. Evicting people into situations such as homelessness and overcrowding, where infection is more rampant, is a great way to spike infection rates potentially more than both temporary shelter/housing systems as well as healthcare systems are prepared to handle.
That's the concern with restoring evictions to pre-pandemic norms. There's not enough capacity in a reduced-crowding scenario such as the one we're currently in.
If you actually want to reduce crowding, build more housing.
I'm not sure where I made the impression that landlords want empty properties. They're evicting so that they can bring in paying tenants, but those tenants are often housed elsewhere anyway, not coming out of unhoused or underhoused groups.
So the point stands: people who lost their means of paying are being evicted into the abyss in order to make room for people who never had a housing challenge.
Increasing the number of units on the market will tend to reduce rents and allow more people to afford housing.
Why are we certain that a family getting evicted from a 2 bedroom apartment can afford a studio? They're getting evicted, presumably for nonpayment e.g arising from joblessness, which would suggest they're likewise also unable to pay for a studio.
> People getting evicted from a studio apartment aren't getting replaced by Jeff Bezos, they're getting replaced by someone else who can only afford a studio apartment and might have otherwise been homeless.
And where are the people getting evicted from a studio going?
> Increasing the number of units on the market will tend to reduce rents and allow more people to afford housing.
City/NIMBY bottlenecks are preventing this from happening, and though I agree with the premise, joblessness won't help when it comes to people looking for housing that needs payment.
Because we're talking about averages.
Two income couple loses one income, can now only afford a smaller place.
You can find someone who went from a two bedroom apartment to homeless because they lost all their income, but you can also find someone who went from a studio to a two bedroom because it came onto the market, and then the studio went to someone who had been homeless.
> And where are the people getting evicted from a studio going?
The same place the people moving into the studio came from.
> City/NIMBY bottlenecks are preventing this from happening
City/NIMBY bottlenecks stand in the way of building new housing, and should be removed.
But the point is that putting the existing units back on the market will tend to reduce rents, so that existing people who need new housing don't have to be in a bidding war over a smaller number of available units.
Consider which is more fair: Six low income people, enough housing for five and those five each pay $800 in rent; or four of them have to pay $1000 because the one who would have been homeless is living rent-free where the one who could afford $800 but not $1000 would have been, making that person homeless.
The only real solution is still to build housing for the sixth person.
As a volunteer I work with a lot of people who have lost housing due to non-financial circumstances (typically fire) and are unable to afford to obtain housing at the same rent due to the up-front expenses involved. The Catholic Charities or city housing authority are sometimes able to front them last and deposit, but both have a limited budget so it runs on a lottery with a low % chance and landlords often find out the source of these funds and then refuse housing (discrimination based on source of funds is illegal in some states but not this one). Charities can cover hotel stay for usually 4-5 days but not much past that point which is not sufficient to cover the gap until a vacancy much of the time. Our case workers routinely watch people go from losing housing due to circumstances beyond their control to homelessness over the course of 2-3 months as they exhaust both assistance and their own funds covering a hotel while trying to find anything they can move into.
When it comes to move-ins, it's certainly not going to be Jeff Bezos but rent is going up significantly right now and so the landlord almost certainly will replace the tenant with someone who is paying more - often significantly more, I've seen 20% jumps from tenant to tenant. Much like switching jobs in the software industry greatly accelerates your pay raises, switching tenants greatly accelerates the rent raises for landlords in tight markets. Most of the US is a tight market right now.
It's the eviction moratorium making this worse.
You have someone who was paying $1600 in rent, now they can only afford $800 and stop paying but can't be evicted. So they're still effectively bidding $1600 for that unit and the two people who both want the vacant unit next door have to outbid each other instead of one taking the vacancy and the other taking the eviction. So the price of those units rises to $2000.
Now the person who can only afford $800 is effectively bidding $2000 for that unit and still can't be evicted. Prices for everyone go up to subsidize the person who isn't paying at all. Which makes the first+last+security problem worse by making it a larger amount of money.
Can you point to some data on this?
[1]https://www.beckershospitalreview.com/workforce/vaccination-...
Yet, the government had to backdown right before the deadline because they literally could not see how the system wouldn't collapse with how many nurses would still be unvaxxed and thus have to be fired. And that's a government that really likes to show how "tough on covid" it is in a very very vaxxed province where you need a vaccine passport for pretty much everything now.
A much safer bet is that no one wants to be doing a job where they're practically front line fighters during a war, for measly pay.
I think a lot of doctors and nurses were reminded during this pandemic that unlike most other jobs, in case of major emergencies:
a) they can be conscripted to work in dangerous conditions
b) everyone expects them to actually do it
This is on top of the day to day responsibilities and risks (malpractice, etc). Much safer to just become an accountant.
I have lots family that left direct patient care because of how terrible the job had become (pre-pandemic) and I constantly worry, if the crisis gets any worse, that they will be drafted/conscripted back into service.
I admire anyone who sticks with it, but I certainly don't fault anyone who leaves to do literally anything else. The field is a horrific shit-show right now.
Here are two lists of many, many hospitals that have instituted vaccination requirements and the resulting number of employees terminated for non-compliance:
https://www.fiercehealthcare.com/hospitals/how-many-employee...
https://www.beckershospitalreview.com/workforce/vaccination-...
Seems to typically be about 0.5% to 1%, occasionally 2%.
Especially if they are clinical staff: good riddance.
> I think that might be what is driving the enrollment reduction.
I think it's more likely that they can't afford to take the classes (either not having the tuition, or having to work longer hours due to inflation), and/or they're reading all the horror stories about clinical staff suffering endless abuse and in some cases physical assaults from patients, their families, and virtual 'gangs' of anti-vaxxers.
The story about the redditor who was treating a dying patient whose family refused to put on masks so they could visit (and ended up removed from the hospital by security) was particularly memorable for me. The doctor went to the trouble of meeting the family in the parking lot, and for their compassion ended up sucker-punched in the face and waking up on the ground. Security wanted them to press charges but they declined because they were afraid of harassment by gangs of anti-vaxxers organizing online.
That is why people don't want to be nurses. Not because of a vaccine.
The current state of things appears to be that internet and media/ad revenue AI machine seem to have come together to put us in an sort of shepard tone of fear and impending doom. Pandemic, war, inflation, division, shortages, crypto, every storm has a name, everything is record breaking. I have more to be grateful for than I've ever had before, in spite of all of this somehow- but I can see the inequality growing around me.
To me it seems like chaos has gone "viral." I don't know when or how it ends and we come out better for it.
It's likely I'm wrong about this, but it's still worth trying this experiment. The potential upsides are too great to leave on the table.
We'd also probably be a politer and less defensive society if we weren't bombarded with constant arguments demanding we spend money on crap.
I think that's why I like Hacker News right now. Among other reasons, out of any news sources, the comments here continue to be mostly grounded and reasonable, not hyperbolic and dramatic.
Unfortunately, somber and stoic news does not have the monetary return from advertising revenue that most news organizations seek. News has become more of an entertainment endeavor rather than one for disseminating information on the state of current affairs. It also seems that the NPR and BBC have gone off the rails in this respect.
I'm curious about your comment about NPR and BBC. Granted, it seems like they have moved more towards the stupidity that we're describing. But not as much as the traditional news networks, in my opinion.
When your news runs on ads you’ll optimize for ad watch time and not integrity.
fwiw in the book it was a means of controlling the populace.
I think we also have to come to grips with the fact that there is a significant portion of the population of first-world nations who desperately WANT a crisis so that they don't have to acknowledge that their lives are miserable for reasons well within their control. Most political radicals on both ends of the spectrum fall into this category. The quantity of blue-checked Twitter personalities who appear to have this belief regarding the pandemic is pretty shocking.
It’s just insane to me that I had to build this in the first place.
If a moratorium was placed on evictions, it was an obvious fact that once the moratorium were lifted, evictions would rise again. It would be unbelievably weird if that didn't happen, and the fact that they haven't rebounded (yet) to levels above "normal" is the real news here, right?
Crisis:
An unstable or crucial time or state of affairs in which a decisive change is impending especially : one with the distinct possibility of a highly undesirable outcome.
Assuming housing is a human right, which I disagree with, surely people are not entitled to any house of their choosing. You would have to separate those forced to downsize from those actually leading to homelessness.
- Not all evictions were covered by the federal ban, or any applicable local bans
- Most people likely did not actually go through the eviction process (most people want / try to pay their bills; most would avoid a life where a landlord is constantly hounding them for unpaid rent; its greatly preferable for a tenant to avoid the mark by almost any means; can be expensive for landlords; some landlords still do illegal “self-help” evictions like lockouts or making tenancy unlivable)
- If the evictions don’t actually “soar” beyond pre-pandemic levels I’d assume it indicates the number of tenants abusing (or even rightly using) the moratoriums was lower than the stakeholders have been making it out to be
- There have been programs running simultaneously to provide rental relief across the country to make payments to landlords
By coupling this information with research from across the web, we’ve obtained the following findings:
Evictions increased by 25% due to both federal and state moratoriums expiring. Southern states experienced higher eviction rates. The rates of evictions served are approaching pre-pandemic levels in certain areas. The renters which are most behind on rent face the highest eviction risk. Statewide eviction bans had a more significant impact than federal moratoriums. On average, renters are behind three months’ rent and owe $2,550.
Check out our blog to explor data-backed insights about the COVID-19 eviction crisis across the U.S.
Doesn't seem like a problem?
Small landlords are losing not only their rental properties and their homes and are up to their eyeballs in debts in many cases.
Greedy corporations are the problem and they’ve been doing since before the current Pres.
I'm not sure that word means what you think it means. >40% of all rentals are owned by individuals, and if you take large multi-unit apartments out of the equation that rises to >72% - that's your "mom and pop" rentals, which by most judgements would take it from the realm of specious and put it smack dab in the realm of the common.
It's quite common for retirees to own outright or invest in rental property - evenly grandfather, who never made more than $10/hr working at a lumberyard for his entire life owned some rentals in his retirement.
Those are the people who are actually hurt by eviction moratoriums.
This will likely be a good thing for most renters.
While a landlord might find a way to make some money from an eviction, the main way they make their money is by getting the rent paid. That's what they evict for, so that they can get someone else who will pay them occupying that unit.
And, if they evict for non-payment of rent, I think they get to keep the deposit, and I don't think that's "stealing". That's part of what the deposit is for. What's stealing might be occupying their place without paying the rent, if you think about it.
And, winning in court doesn't mean you get paid. If they didn't have the money to pay the rent, they usually don't have a huge wad of cash sitting around to pay the back rent + court costs. So, you won in court, enjoy your nice victory that you can't collect.
1. https://www.nar.realtor/blogs/economists-outlook/landlord-st...
2. https://getflex.com/blog/landlord-statistics/#:~:text=The%20....
The maximum profit is renting to someone that can barely afford to pay, but also desperately doesn't want to leave. In total, I probably made a 13th months rent each year in fees. You are leaving money on the table renting to people that can afford to pay on time.
For everyone wondering why landlords get a bad reputation, this right here is the reason. It's also what people mean when they say "It's expensive to be poor".
There are a lot of nuanced variables that are hard to enumerate, but maximizing revenue is not evil.
My tenants voluntarily chose to sign a rental agreement, were aware of the terms of that agreement, I was always in compliance with all applicable laws on rent and fee collection, and when my tenants lease was terminated, it was always voluntarily and with all parties leaving on good terms.
I agree it is expensive to be poor, but I disagree that maximizing fee collection is why people hate landlords - lying about terms in the lease, violating local laws, denying applicants based on protected status, refusing repairs, trespassing, unlawful evictions, etc.
You can hate me for what I did though, I can't change that. I wish you luck.
850/month, what a dream. I haven't seen that rate in a few years and I'd have to give up in-unit washer/drier to get that.
(edit) - typo
Even within cities it doesn't help, it is down to neighborhoods and streets. These threads seem to devolve into "It is so expensive in XYZ" or "You can get 5 homes in ABC."
I wonder if the rent rates tell a story of certain housing areas and things happening there.
Finding meaning in this is hard. Is there any list of the areas? Knowing the areas would allow for some deeper analysis. For example, is an area one that is trying to operate as it did pre-pandemic?
Any analysis of what this means makes a lot of assumptions.
> The renters which are most behind on rent face the highest eviction risk.
Isn't this always the case? Is there a time this isn't the case?
> On average, renters are behind three months’ rent and owe $2,550.
On average, renters aren't behind. It's renters being evicted. So, renters being evicted are, on average, those that are 3 months behind in paying their rent. Is eviction after 3 months of non-payment typical? If not, what is?
This is kinda shocking - not that the rates are rising, but that after the drumbeat we've been hearing about the coming eviction-pocalypse, it hasn't happened. Seems that there'd be pent-up demand for eviction after 1.5 years of not being allowed to, which would result in a much higher rate for a while until it leveled off. Guess that didn't happen!
Not quite. Only 0%.
It's going to be less and more delayed than rent payments, but that's expected during a crisis.
Renting isn't, and shouldn't be risk free.
That goes both ways, as a renter you risk getting kicked out, while as the landlord you risk not getting paid. Landlords typically evict and get someone who will pay but they were unable to. While there were programs for landlords, it was hard to get money out of them for various reasons.
Did I imply it doesn't? Evictions are no longer banned at a national scale. So, uh, yeah? We already know it goes both ways. In this special circumstance, the government essentially came in and said "We're not going to allow you to do that type of business for a bit for the sake of society."
Landlords by definition exist because the state allows them to exist. If the state wasn't there, landlords would probably be at the mercy of the 90% - and things would get ugly. So, to keep enjoying those protections that the government is giving, you need to follow circumstantial business changes. Such as a pandemic.
I mean, medicine is socialized (*) so that living will be "risk-free" health-wise, so why not housing?
(*) - Yes, I know that doesn't hold in the US...
Some states had programs that would provide some money to renters to help them with that, but it wasn't enough for a lot of people.
But my less affluent neighbors also didn't receive anything in direct support of rent payments, despite their jobs disappearing.
[1] https://dfpi.ca.gov/2021/03/15/covid19/
[2] https://home.treasury.gov/policy-issues/coronavirus/assistan...
For the most part, we saw landlords REFUSING these subsidies and refusing to help tenants get them - https://newrepublic.com/article/163840/erap-cash-tenants-not...
The reality for her company, and many landlords, is that it was extremely easy for a deadbeat tenant to stop paying rent. They simply printed out the form, filled it out (it was essentially a 1 page form), and they could immediately stop paying rent and not be subject to eviction. No verification was needed. City workers who were definitely still employed according to public records were doing this on 3 of her properties when they did an audit.
Conversely, the programs that would reimburse landlords required far more rigorous documentation, AND ACTION FROM THE TENANT. That last part was the killer. The deadbeats simply had no interest or motivation to fill out paperwork that allowed the landlord to get reimbursed.
I know that this is anecdotal, but my sister is also an elected representative of an industry group that represents property management companies. Her group did extensive surveys and analytics, and concluded that in the state of Virginia, the problem was widespread, and her company's experience was actually a bit better than most of the other member companies.
She would call me to vent quite a bit. She was furious at how "thoughtless" the original implementation of the moratorium was under the Trump administration. She thought for sure that Biden would come in, see it as a Trump artifact, and revise it in a careful way. This didn't happen, and he instead extended it twice. It was extremely detrimental to their business, but more importantly, to any and all new tenants, as well as existing tenants. New tenants had to pay far higher rents. Her company had to cover the losses from the deadbeats, and additionally, had to "price in" the risk of a new tenant suddenly filing the moratorium form and ceasing to pay rent.
It never ceases to amaze me how bureaucracies will double down on policies while ignoring the unintended consequences they produce.
The deadbeat tenants don't really escape their liabilities though. They've gone for so many months not paying and not pursuing aid. So when they're evicted, eventually, they owe so many months back rent to the landlord. I'm sure some will escape through bankruptcy, expatriation, new aid, etc, and that the annoyance (if not the cost) of pursuing the rest will be substantial. But anyone that actually realized a financial gain at the landlords expense through is going to face liens, garnishment, and seizures until they're square. If there really are tons of these people, it would seem like a good time to be in the collections business.
So, it prevents that. And it's an important thing to prevent.
Moreover, while many tenants have continued to pay their rent - MANY have gradually started realizing that I am unable to evict them, and have completely stopped paying rent. Moreover, they have started collaborating under the assumption that there is more protection if they do it together.
Like other landlords, I have lost a tremendous amount of money in this pandemic. My 12 unit complex represents my retirement, so this hit me very personally.
It's incredibly unfair that the most honest tenants continue to pay. The ones not paying are not paying because they know they can get away with it - not because they cannot pay - they are all still working.
Financial advice always says, don't put your eggs into one basket. If a single multi unit apartment represented your retirement, that seems to have just been bad investment?
Anyway, rental assistance programs are available out there. Just need to put the work in and apply and wait.
I can see why people get so frustrated with landlords. It’s the same kind of frustration when Wall Street asks for government intervention after making a series of bad trades
Even worse, a long term eviction moratorium is incentivizes landlords to filter out poorer tenants with income and credit requirements, making housing more expensive for them.
If the government bans cigarettes, should the government then reimburse every shareholder in Philip Morris?
>However, they are the ones who are forced to pay for provide a service that the government desires, housing, at their own expense
Someone had to brunt the cost of the pandemic. It would have been bad public policy if the government had let people go homeless.
Regardless, my point isn't that the government acted piously here, it's that real estate is a capital asset class and should be treated as such. If you get in the game of capital speculation you shouldn't get to go crying to the government when things don't go your way. I have the same amount of sympathy for people who all-in on urban real estate and the people who go all in near to expiration SPY calls. The government's primary concern shouldn't be protecting people's capital investments.
No, but that's because Phillip Morris isn't actively offering anything to the government. A landlord that isn't allowed to evict is. If the government forces them for provide cigarettes to soldiers during a war, they have to pay them to do so.
> Someone had to brunt the cost of the pandemic.
That's what taxes are for. Even money printing is better. It doesn't make sense for them to target landlords who serve low-income tenants in particular. That would be like forcing grocery stores to offer free food to poor locals. In the short term, it may help some people, but in the long term, grocery stores in poor neighborhoods would simply shut down and everyone would be worse off. That's why we have food stamps instead.
> If you get in the game of capital speculation you shouldn't get to go crying to the government when things don't go your way.
I agree that land speculation is particularly useless and the government should try to get rid of it, but that's not happening. Property speculation is higher than ever.
You are also entitled to sue your tenants in arrears for every penny of unpaid rent plus the costs of collecting. Even with a judgement you may not be able to collect if they have become destitute, that’s the nature of the business you are in.
I sincerely hope you get a chance to retire, society would be a lot better if everyone is able to. Hopefully we don’t all need a 12 unit building to do so!
I know you WANT to believe this program didn't screw over landlords, and that most of the people utilizing the program were honest, good human beings. That's simply not the case when you talk to any landlord.
Feel free to ask the person you are replying to what their experience has been. I have yet to meet a landlord that doesn't have a hugely negative view of the entire suite of pandemic programs.
See another comment I made discussing my sister's experience.
The childish, dorm-roomy attitude of landlords being "big faceless corporations" is wholly inaccurate and distorted. The same group also has this view that most people using this program were honest, good citizens experiencing true hardship. This is absolutely not the case according to every audit my sister's company did, as well as the research the industry organization she was elected to did.
It's a bunch of dirtbags capitalizing on a poorly constructed policy.
They allow politicians to pretend they've resolved a problem, while managing other aspects of a crisis. Later, when the moratorium expires, hopefully the media is concerned with other things and the plight of the evicted will go unheeded.
It's also a middle-of-the-road measure between doing nothing (bad publicity) and declaring a rent holiday / subsidizing rent from taxes / expropriating rented-out apartments or other such measures (politically difficult, angers donors and politicians' social milieu).
Individually, no. As a class, yes. Property rental seems a lot like a Subway franchise in this respect. If one property owner becomes insolvent, the property will be sold to another person who is not. The tenant might be evicted by the new owner but, on average, probably not.
Edit: pardon my obscure Subway reference. Subway franchises are notorious for going out of business with incredible frequency. You'd never notice because an insolvent franchisee's best option is to sell the operating business to another, solvent franchisee. Subway arranges the sales. Then Subway sells more franchises with statements to the effect of "80% of locations have been operating for over 20 years" (not their actual words).
Elevating group identity over individuals is the root of some of the most evil activities in human history.
It should be noted that individual human beings who moved to a new home and chose to rent their old home got burned by this moratorium as well. Often getting put in a situation where they were forced to foot the full bill of two mortgages, with no end in sight. There was a well-reported case of a terminally ill cancer patient who lost all of her income when a tenant in her split-level home stopped paying rent by abusing the moratorium.
Your Subway example was hilarious, BTW. I've seen that happen so many times lol.
America has a very very high eviction rate compared to other countries. I went through 2 evictions by 19 and their the worst things you can experience.
In this country you can lose your job on Monday, lose your health insurance Tuesday. Which, even if you have manageable conditions will make it much harder to work.
Then without a job you'll be evicted in another month or so. Somehow other countries don't work like this.
This must be a state by state thing, because in California you can't get evicted in less than 90 days.
If the local sheriff feels like it , he or she can give you another week. If the local judge desires, you can be granted 6 months
Notably NJ requires “cause” for terminating or even refusing to renew residential leases, which appears to be unique as far as states go.
The government saying you can't evict someone is basically telling people they don't have to pay rent anymore regardless of need. Rent control is the same way: you can't raise the rent regardless of need. So these programs don't really help people in need: they help market incumbents.
This is the government foisting welfare onto the private sector rather than doing it properly.
If the government didn't want people evicted due to pandemic circumstances, what they should do is assess this on a case-by-case basis and pay the rent for people in genuine need.
The Internet is full of stories of people who just stopped paying rent because they didn't have to anymore as well as taking government checks intended for the landlord and just cashing them, which is a whole other issue.
But some people justify this because, you know, "f*ck landlords", which always struck me as incredibly backward: the only reason there exist apartments and houses to rent is because someone has provided the capital to build them and rent them to you.
Now you can argue maybe the government should do that. I can respect that.
But no rentals at all? So the only way to have somewhere to live is to buy a house? Really? How is that practical and not a recipe for massive homelessness?
As an aside, we do need to do something about hedge funds running around and buying up all the property, only building ultra-luxury property and the ultra-wealthy just parking money in real estate but none of those issues invalidates the need for a rental market to exist.
There's no easy solution when we've built up such a strong culture of individualism, that's effectively focused on avoiding collective responsibility for individuals who are struggling.
There are simple solutions to slumlords: reporting them and enforcing the habitability laws that are already on the books.
As usual this probably won’t get addressed because most lawmakers are part of the groups that benefit from this state.
Nothing is ever this efficent at scale. The point of the program was to stop people (and families) from going homeless during a health and economic crisis. The easiest and arguably best solution is a blanket ban.
This is similar to the PPP program. No one checked the credibility of businesses applications until after the money was sent out (the emergency warrants this).
None of these ideas are particularly popular amongst land-owners.
Or non-landowners. Turns out, the state isn't particularly interested in constructing nice housing, or doing so in adequate numbers. So people end up living in communal spaces while sitting on a decade-long waitlist for something to open up.
"Drive until you can buy" then drive some more. Enjoy the wear and tear on your mandatory vehicle.
He's retired now. Built a small time, local only 1-800-GOT-JUNK style business. He's a millionaire now. I'd be surprised if he'd finished high school.
At least where I live, you can't really do that these days. Property is way too expensive and well-meaning building codes make basic things essentially out of reach. I'm not talking about things like circuit breakers or child-safing banisters and railings, I'm talking about the long tail of regulations that don't really help anyone.
The rich and the poor keep getting more and more disconnected and I understand the raw rage coming from the other end of the income spectrum. We need to help them.
For example, in California, all new homes must have solar power, with the requirement that [1]:
> The solar panel system needs to be large enough to meet the annual electricity usage of the building
> builders can decrease the size requirement of a system on a property by incorporating battery storage ... <and> ... by incorporating energy efficiency measures or other demand-responsive measures
1. https://news.energysage.com/an-overview-of-the-california-so...
I'm not sure you've fully thought through how complex this would be. There are 40 million rental households in the US. Even if only 1% (400,000) decided to be a part of this program and you could close every case in 1 hour (which is probably wildly low) that's 45 man-years of effort.
Of course, it would take three years to roll out the computer application that they would need in order to make and document the decision, but that's somewhat a separate problem...
Spinning up a 500 person accounting firm wouldn't be snappy.
I suggest a ban on all SFH rentals. The reason why it seems unviable to have everybody buy a home is because there is so much demand created from people owning multiple homes and bidding up prices in the name of making a profit. If we eliminate at least SFH rentals it becomes much more viable. There are at least 16 million SFH rentals and that number is just growing.
This would solve two problems at once: reduce sprawl by encouraging the building of non-SFH for profit seekers, and reduce demand for SFH which is currently being driven up by profit seekers.
I'd much rather be in position backing mortgage on 100k house, backed by mortgage insurance, than risking someone I don't trust with that same 100k having full custody of my house worth 700k.
If real estate becomes a non-cash producing “asset,” mortgage insurance would become far pricier.
Mind you, many people do cause significant damage to the spaces they rent. This being among the most frequent complaints by landlords.
At equal level of negligence risk (which for most people, yes, is quite low), the monetary expected loss through negligence or crime on 700k home should be greater than that on 100k home, all else equal (same person, location, etc).
And all of this fails to account for the greater personal incentive one has to pay for their own house and take care of their own house than for someone else's they're just renting.
If you don't pay rent you are (supposed to be) evicted in short order and replaced with someone who does pay rent, specifically to avoid damaging the landlord as you describe.
> the monetary expected loss through negligence or crime on 700k home should be greater than that on 100k home
But that's not what we're talking about. The risk of significant damage through negligence by a tenant on a 700k home is much lower than the risk that same tenant would default on a 100k mortgage. That's the whole point.
Precisely! Not paying rent is a damage to the landlord. You're destroying value. So we can't say you aren't damaging anything if you just don't damage the house.
>The main differentiating factor between a landlord and a tenant is risk of default. If you are appraised to have a risk low enough for a bank to tolerate, you get a mortgage. If not, you don't. What's wrong with this process?
Nothing. I'm pointing out how idiotic it is for someone to be trusted with a 700k house who can't be trusted with 100k mortgage.
>But that's not what we're talking about. The risk of significant damage through negligence by a tenant on a 700k home is much lower than the risk that same tenant would default on a 100k mortgage. That's the whole point.
That's not the entire calculus. The risk to the landlord is that the tenant won't pay or that the tenant will destroy the house. The difference is a land owner has even less incentive to destroy their own house and even less incentive to fail to pay up his/her own mortgage. The risk to the bank is that both you won't pay AND after they seize the property they can't recoup all the damages of non-repayment / lost interest and the principle. This is even more magnified when comparing a 700k rental property to a 100k mortgage. You can't just compare risk of damage to rental house to risk of default.
Having collateral is a much more enviable position IMO and the fact that someone who owns a house has a real interest in protecting it just doubles down on this tipping of the balance to preferring to be a mortgage provider over a landlord in dealing with potential tenant/mortgagee of equal risk.
>The risk of significant damage through negligence by a tenant on a 700k home is much lower than the risk that same tenant would default on a 100k mortgage. That's the whole point.
How much damage does the bank really have on someone who holds mortgage on 100k house, defaults, and then the bank takes the house and flips it for now even more money? It can't be that much more than the landlord who rather than having something to seize just outright loses the rent on a 700k house and now can't pay their own mortgage. I'd much rather be in the bank's position here.
If you can make rent on a 700k house, you can make mortgage on a 100k home. If you don't pay, the home will be taken away (and probably sold for more than you bought it for in this economy), while if you don't pay rent the landlord is out mortgage payments with quite possibly no asset he can seize from you.
This all goes back to my point. "Someone who can't be trusted with 100k [sic: mortgage] shouldn't be entrusted to inhabit a house worth 700k."
But this happens all the time when people rent anything. You can rent a Lambo, doesn't mean you can afford to buy one. Trusting someone not to destroy something while the use it isn't the same as trusting them to pay you the full value of it upfront.
Otherwise it seems like you're suggesting there's a missed opportunity to grant mortgages to financially unstable people. Isn't that what caused the 2008 financial crisis?
> Someone who can't be trusted with 100k [sic: mortgage] shouldn't be entrusted to inhabit a house worth 700k.
But they are and it works just fine.
>Trusting someone not to destroy something while the use it isn't the same as trusting them to pay you the full value of it upfront.
You don't trust them to pay you. If you did, the house wouldn't have a lien on it. You may mostly kind of trust they won't burn it down or destroy it, so you might trust you'll say get 80% of your money back and thus require a 20% down payment or something.
>But they are and it works just fine.
If the market can find a way to price in risk for someone renting a 700k house which entails them usually paying at least interest on the value of house + property tax + maintenance (this is all indirect payment, but basically what a landlord needs to charge to at least break even), the market can find a way to price in risk for that same person buying a 100k house.
I definitely understand that rentals can be profit seeking tools that are harmful (ex: slum lords) - but I don't think removing the ability to rent actually solves that problem.
If you can't rent - there are wide swathes of my city that just wouldn't be developed at all. It would remain the private estate of the family that owned it. Instead those plots are sold or developed into apartments/condos/townhomes.
Basically - land is a revenue generating asset. If rent is illegal, folks will use it for the next best revenue they can make. They won't just suddenly dump it on the market for sale.
Further - renting can be a valuable tool. I moved very often right out of school seeking to live as close as possible to my current job. That was insanely helpful to me, and not something that would be financially feasible if I had to purchase and re-sell for each (near-yearly) move - even if the house I was buying only cost 100k, and not 500k.
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Basically - I understand the sentiment, but I think this argument glosses over far too many likely consequences of removing the ability to rent (ex - I promise you you'll just end up with a lot of company towns where "Room & board" is free, but only if you work the company job.)
Plus, in the most unaffordable places in the world, rental prices are dirt cheap compared to purchase prices. In a lot of these places, rental income is so inconsequential, that places sit empty because owners don't want to deal with renters, since most of their return comes from appreciation. Which suggests that rental prices are completely detached from purchase prices.
granted, this is a college landlord that is just taking advantage of college students, but I should have more recourse than “sue them eventually” when my landlord charges me a $90 late fee on my $0 balance that requires 6 office visits to resolve.
the other problem with landlords is that they aren’t spending capital to build. they’re spending capital to buy. corporate landlords (say 25+ units) should not be allowed to buy existing single family dwellings imo.
This is the key point. It's the same with rent control. It's governments dodging its responsibilities, then pushing the costs to the private sector unevenly. If you really want these programs, send the people subsidy checks. It's more fair to renters, it's more transparent, and it makes it easier to track the true cost. Don't want to send out those checks? Maybe you shouldn't volunteer landlords to subsidize your social program.
The question is, did the government have the manpower to do a case-by-case assessment. One of the issues faced in Canada was getting employment insurance money out to people in a timely manner. Their approach was very much loosen the criteria and take claims at near face value until they had time to sort things out. Fortunately, the government can sort-of do that in that scenario. Unfortunately for evictions, things have to be sorted out before a person ends up homeless.
As for "f*ck landlords", I never quite understood it. Then again, I've always dealt with small landlords and usually had some form of reference for them before signing the lease.
The closest we could come was the stimulus checks that went to anybody with a prior-year's income below a certain threshold (IRS has that info).
I theorize this is infeasible in the US at the national level because there are probably regions in the US with insufficient manpower to do this manual review (though someone might correct me on this). It's easier to throw money at the problem by giving money to those who don't need it than it is to hire and maintain headcount.
I suspect this because this is far from a new problem. People have long abused welfare in the US who don't actually need it because the review process is incredibly lax (which in turn perpetuates the idea among the American right that government welfare is a waste of resources).
Though aside, I'm always wary of believing stories I read on the internet that paint the political situation in a certain light even if they're allegedly from individuals. But I've personally known people in real life who bragged about abusing welfare before, so I know that's a thing (though I don't recommend you take my word for it).
At the Federal level there is a Section 8 housing.
At the state level there are various rent assistance programs.
Most people are also W2 employees so their income is tied to their SSN so a lot of this can be automated by simply looking at your actual monthly income.
The fact that you'd need to apply for this would also discourage some people from abusing the system.
Lastly, I don't really care if the system isn't perfect and some people get assistance they don't need. It doesn't have to be perfect. It just has to be "good enough". At an ethical level, I'd rather give people the benefit of the doubt and not make them homeless than worry about them abusing welfare some of the time.
> People have long abused welfare in the US who don't actually need it
I'm always skeptical of claims like this because they're used as a political tool to attack poor people for being poor. OMB's estimate [1] put this at "5.6 to 7.2%". In a country that spends a trillion dollars a year on the military, that's a literal rounding error that I don't care about at all.
[1]: https://www.whitehouse.gov/omb/briefing-room/2021/12/30/upda....
If this were true, then you would expect an explosion of evictions now that you can do it. I think that avoiding eviction is an important reason to pay rent but there are other, particularly not going into debt, not wrecking your credit score, and keeping your rental in the long term.
I don't disagree that this was dumb as a blanket policy but this was also an emergency no one expected and no one knew how serious it would be in terms of health and impact on the economy.
But yes, there is no doubt that the way this went down is making the moat (between labor and capital, middle class and upper, small business and massive conglomerate, etc) bigger and bigger.
I imagine evictions are the exact same market space.
1) Leeches occupy housing without paying
2) Paying renters compete for constrained supply of housing not occupied by leachers
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Option B:
1) Leeches kicked to curb
2) Paying renters compete for entire supply of housing
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Option B has higher supply for the competing demand. Prices should fall, unless all leeches become paying renters.
Had a single mom move into my rental house. She missed rent a few times, but I always gave her time to make it up weeks later instead of doing what the law allowed and serving an eviction notice with a 3-day limit to come up with the rent.
She ended up letting some loser move in and they proceeded to trash the place together by running a rabbit breeding operation out of the house.
I should have just done a short sale at the outset instead of "doing the right thing" and holding onto the property for 5+ years and having to sell at a loss even in a strong market.
https://trends.google.com/trends/explore?geo=US&q=eviction%2...
2. Give the $10000 to the renters being evicted
3. Provide a free template to renters to counter the eviction
The only landlords that will continue to exist are those that cut rents to levels that people can actually afford, instead of resorting to eviction while snoozing on an armchair.
The rest will be out of business and their properties will be affordable to young buyers again.