The Housing Affordability Crisis
Back in early 2014, Secretary of HUD Shaun Donovan issued a warning that rocked Washington.
Speaking Tuesday at an event hosted by the Bipartisan Policy Center, Secretary of the United States Department of Housing and Urban Development Shaun Donovan called on members of Congress to pass housing finance reform now because “this might be the only chance we have to get something done in this decade.”
...Donovan said that it was critical to provide affordability across all segments immediately. “This is the worst rental affordability crisis this country has ever known,” he said.
And just like that, Washington sprung into action! They passed legislation and reformed the system. The crisis was averted.
Hah! I kid.
Absolutely nothing was done, and the "worst rental affordability crisis this country has ever known" has gotten much, much worse.
If it feels like the rent keeps going up, you’re not alone: The share of U.S. disposable income that went toward such spending totaled 3.81 percent in the third quarter, marking the highest share in data going back almost six decades.
Rising shelter costs have accounted for most of the inflation in the U.S. during this economic expansion. While part of the rising rental share of spending may result from falling homeownership in recent years, the price index for rental of tenant-occupied nonfarm housing rose 3.7 percent in the year through September, according to data published Monday by the Commerce Department, near the fastest pace seen in the last decade.
So not only the biggest single expense for the working class gotten exponentially worse, it's gotten worse at an increasing rate.
Fortunately the government expanded the available stock of housing for lower-income people and...
Hah! I kid again.
What actually happened is the federal government did nothing but watch while the amount of affordable housing under Obama dramatically shrunk .
The number of apartments deemed affordable for very low-income families across the United States fell by more than 60 percent between 2010 and 2016, according to a new report by Freddie Mac.
“We have a rapidly diminishing supply of affordable housing, with rent growth outstripping income growth in most major metro areas,” said David Brickman, executive vice president and head of Freddie Mac Multifamily. “This doesn’t just reflect a change in the housing stock.”
Rather, he said, affordable housing without a government subsidy is becoming extinct.
Not only are fewer low-income units coming on line, but existing units are migrating out of affordability.
This has left so many people in “worst-case housing needs” that it rivals the very peak of the housing crunch of a decade ago.
HUD released a report to Congress on Aug. 9 entitled Worst Case Housing Needs 2017 which found that 8.3 million households had “worst-case housing needs” in 2015, meaning they are very low-income renters who do not receive government housing assistance and paid more than half their income for rent, lived in severely inadequate conditions, or both.
After a decline in worst-case needs from nearly 8.5 million in 2011 to 7.72 million in 2013, the number of these very poor, unsubsidized renter households increased to 8.3 million in 2015. This latest figure is the second-highest number of households recorded.
HUD Secretary Ben Carson says we should take a free market approach to the problem, ignoring the fact that this is exactly what is happening now and why we are in this situation.
The primary problem is that shelter is viewed as an investment, rather than a necessity.
Thus those with deep-pockets want prices to go forever higher, and they influence tax policy.
For the most recent trend, which began two years ago in September 2015, the trailing twelve month average of median new home sale prices in the U.S. has been escalating at an average rate of $906 per month.
In terms of affordability, the ratio of the trailing twelve month averages of median new home sale prices to median household income in the U.S. is near its all time high of 5.454, which following revisions in the data for new home sale prices, was recorded in July 2017.
As long as house prices skyrocket, so will rents.
Comments
There are no homes, no jobs.
And neither party gives a real, actual fuck. They're working together to fuck us all at both ends and we have no recourse.
Modern education is little more than toeing the line for the capitalist pigs.
Guerrilla Liberalism won't liberate the US or the world from the iron fist of capital.
Both political parties care deeply about this
They are working tirelessly, burning the midnight oil to make sure that low-income people have a place to live.
Isn't that obvious?
/s
oil
Both political parties are boiling low-income renters in oil, you say?
"US govt/military = bad. Russian govt/military = bad. Any politician wanting power = bad. Anyone wielding power = bad." --Shahryar
"All power corrupts absolutely!" -- thanatokephaloides
There Are Plenty of Guns, Though... nt
“Tactics without strategy is the noise before defeat.” ~ Sun Tzu
@k9disc. How fortunate for the
. How fortunate for the elites that the Las Vegas shooting gives them the excuse to take away guns with enough firepower to be a threat to them.
Legislation
to take away guns is rushing through congress as we write.
Mao Zedong provided the answer.
Everything you know to be true remains true, regardless of circumstance or fantasy. Aristotle made this point a long time ago. All that stands between us and understanding is our growing wish to remain blind, as more and more is understood.
They are very sad
that they can't kill us quicker.
"They," of course, being the ubers and filthys (as I call them).
The uber rich and filthy rich, aka the 1%, oligarchs.
They can't off us quick enough.
"Dammit, we've all but taken away their health care, Medicare,
jobs and housing, and the fuckin' 99% still walk, breathe. What
else we gotta do to off these mofo slackers?"
the little things you can do are more valuable than the giant things you can't! - @thanatokephaloides. On Twitter @wink1radio. (-2.1) All about building progressive media.
Food will be next.
Wait and see.
This shit is bananas.
But it isn't about the poor - it's about everybody
for everybody making $17,000 who can't afford rent there's a family pulling down $70,000 who can't afford a million dollar mortgage so both partners have to commute 50 miles, spending huge amounts of money for gas, upkeep and maintenance on two cars, and child care. They will never retire, never even change jobs until laid off, never make more than interest payments on their ever increasing credit card bills, never live decent, happy, secure lives. The poor are not the only targets, just the obvious targets.
On to Biden since 1973
And for those with disabilities who can't commute....
we're fucked at both ends. Employers are especially openly hostile to people with disabilities even when they're fairly well educated because they tarnish the lily-white corporate image.
Modern education is little more than toeing the line for the capitalist pigs.
Guerrilla Liberalism won't liberate the US or the world from the iron fist of capital.
Corporate images need a lot of polishing,
and there's an entire industry devoted to the task. It takes great skill and considerable investment, to convince the hoi-polloi they are not being robbed.
native
Especially when your city’s public
transportation SUCKS.
I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks
Politics is the entertainment branch of industry. - Frank Zappa
California Housing Prices
I was in the wholesale mortgage industry from about 2002-05. At that time the minimum gross income required to purchase a modest 1,200-1,500 sq. ft. home was $100k. Back in the day it was a rule of thumb that a homeowner should expect to pay 25% of their total income for housing.
Seminars to learn how to "flip" property go back at least 30-40 years. They are still advertising the same seminars here in Cali. It's a never ending Ponzi scheme.
"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn
But Ponzi schemes DO end...eventually,
when they have more suckers flooding in than they have fake "assets" to peddle. The consequences, though, are pretty brutal.
There is no justice. There can be no peace.
as we all know, ben carson has had a long and illustrious
career studying and reporting on the mechanics of the housing market.
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
I am so glad you wrotes about this, gjohnsit.
I bookmarked an article written back in mid 2015 that tracked the cost of rental housing by state.
The criteria was the hourly wage required by a full time worker to afford a two bedroom apartment in the lower 40% rental range for each state. The current federal minimum wage $7.25 per hour. And while many states have a higher minimum wage, none of them come close to the requirement for a full time minimum wage employee to find adequate housing.
Every state, except Arkansas, would require a minimum wage exceeding $13.00 per hour to meet the housing affordability requirements. Many states would require a much higher minimum wage. The cost of everything has risen in recent years, but nothing has risen as high as the cost of housing, particularly rental housing.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
I'll be getting up close and personal with this "crisis" soon.
The wife wants to split up after 22 years and I'll be a 55 year old chronic pain patient with spine arthritis trying to exist on $350.00 a week. Good times.
The real SparkyGump has passed. It was an honor being your human.
Sorry to hear about this, sparky
I am thinking of getting either a roommate or a trailer next summer. There is no way I'm going to be able to stay in my house after then. I've found an affordable 5th wheel trailer, but I need a truck to pull it. I'm hoping that my friend at the cemetery would let me park it there until I can save enough money to buy a used truck.
How do you feel about Utah?
Which AIPAC/MIC/pharma/bank bought politician are you going to vote for? Don’t be surprised when nothing changes.
That is so very kind of you!
If I come out of this sane and alive, it'll have to be upstate/central NY or, preferably, Vermont. I don't have anything against Utah, I've never been there. It's just my roots are here and, at least, I know the area and have always wanted to live in Vermont. I never thought I'd have to live out my days in pain and poverty. I've been working since I was twelve. Medical bills drained my retirement and my wife's spending took the what was left. But, sometimes you have to play the cards you're dealt and take your losses as they come, no matter how devastating they are. Thank you very much for your kind offer.
The real SparkyGump has passed. It was an honor being your human.
When Warren was asked why she voted to confirm Carson
She said that she felt that she had to because if he wasn't confirmed then Trump might have appointed someone with worse credentials. WTFFF!?
What she should have done is vote against everyone who wasn't qualified until Trump appointed someone who was.
This is the exchange between Carson and Senator Al Green on cspan talking about the $6 billion cuts to HUD.
$6 billion after congress gave the pentagon $54 billion more than what Trump wanted in the defense budget!
Housing and Urban Development Oversight
So Warren, how do you feel about your vote for him now when it was obvious during his confirmation hearings that he wasn't qualified?
I've mentioned the problem I had when I received a housing voucher. Now with the rental market getting much worse, does anyone think that low income people will be able to find somewhere to live?
h/t to DK for the video transcription
Which AIPAC/MIC/pharma/bank bought politician are you going to vote for? Don’t be surprised when nothing changes.
ooooh, that smarts.
This is something within your bailiwick my dear sir. How much from housing vouchers?I almost pity the fool.
but no.
I guess i’m not the only one who
doesn’t think Warren’s anywhere near what she’s ‘cracked up’ to be.
I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks
Politics is the entertainment branch of industry. - Frank Zappa
No, you're certainly not.
I'll never trust her again, not ever. While I might listen to what she says, I won't even bother with that much anymore. She's probably figuring on a POTUS run in 2020, she is immediately suspect to me.
Only a fool lets someone else tell him who his enemy is. Assata Shakur
The rest of the transcript
I love the way that Green ended his remarks to this cretinous creature.
There are more transcripts from this hearing on in the cspan article. Of course, there were a few republican senators that didn't see what the problem was if the HUD budget is cut by $6 billion. Any cuts is too much for a fund that is already severely underfunded.
Which AIPAC/MIC/pharma/bank bought politician are you going to vote for? Don’t be surprised when nothing changes.
public servant
but he is a black man in powerful position.
so it must be a good thing.
aargghh.
Informative post.
Just another non-expert here, but my gut tells me that the 2008 crash, which bankrupted millions of people, combined with the subsequent bailouts that allowed the same banksters (who didn't go to jail) to buy up the same 'distressed assets' they created (through bank fraud) for pennies on the dollar, would now have a hard time finding renters within the same general population they ripped off, who can afford rental properties owned by folks who would rather overprice them or let them sit (to collect tax-deductible "losses"), than to actually maintain them while renting them out at affordable rates.
But that's all gut analysis, and I'm sure there's an inaccuracy or two in there.
Mike Taylor
What's the point of raising rents so high that people won't
be able to rent them? This makes no sense to me. It's the same with people not being able to buy houses. The homes that aren't being rented or bought are going to lose their values and the people who bought them and banks that have them for sale aren't going to make any money from them.
The other thing I've been thinking about is the Equifax hack. I've been reading articles about people who have had their identities used to open new credit cards and are buying things with them, but no one has to pay for the things that were purchased. Banks are going to be stiffed with those purchases. One woman said she received 15 letters from stores such as Macy's and other stores.
If anyone wants to freeze their credit without paying for it with each credit reporting agency, you can file a police report and then it doesn't cost you anything.
And what needs to happen now is that no one should be able to open up a new credit card account unless they do it in person and have the correct identification with them, not only the information to do over the mail.
This means that credit card companies need to stop sending people 5-10 offers a week. They are wasting tons of money sending their officers to people like me. I'm not going to qualify for a new credit card.
Which AIPAC/MIC/pharma/bank bought politician are you going to vote for? Don’t be surprised when nothing changes.
the economics aren't too complicated.
for purposes of illustration, i will use an oversimplified set of numbers.
a. imagine that i own all 100 identical rental properties in a community with exactly 100 would-be renters.
b. imagine that each renter can afford a different amount of rent -- to keep it simple, lets assume that renter #1 can afford $1, renter #2 can afford $2, etc.
c. if i set the rent at $51, i will collect 50 x $51 = $2550 / month. if i drop the rent to $50, i will collect 51 x $50 = $2550 / month -- same total, but now I'm maintaining another unit, and dealing with another renter. However: If I drop the rent by one more dollar, I'll collect 52 x $49 = $2548.
Thus, I'm better off holding properties off the market and setting the rent at a higher level.
This is a perfect, though of course synthetic, example of why markets are not a solution to human problems. (At this point, the free-market ideologue will start to babble nonsense about this being why we need to deregulate building codes and real estate development and blah blah -- as if the problem were something other than the amoral and an-ethical perversity of markets as a resource allocation mechanism.)
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
Another reason
Speculators do not necessarily buy properties to rent them or even sell them right away. They have already obtained these distressed properties at a discount to begin with, so holding them is not necessarily an economic negative. They may hold them until the market is ripe for making a large profit off the sale of them.
Another phenomenon that I have witnessed in my town is the sale of lower priced, affordable houses is often to landlords who fix them up with cutesy decor and turn them into short term rentals via Airbnb or VRBO. These sales have already occurred before the house is publicly marketed, but is still advertised for sale with a pending contract. It has become a real problem in my small town in western NC and I just witnessed upbidding on a recent sale of a small house in a good neighborhood that needed work.
The lack of affordable apts or other rentals as well as the conversion of affordable units to short term rentals serves to price many people out of the housing market.
The housing market in nearby Asheville is so tight that short term rentals have been banned there, but are still happening.
Do I hear the sound of guillotines being constructed?
“Those who make peaceful revolution impossible will make violent revolution inevitable." ~ President John F. Kennedy
bing! n/t
the little things you can do are more valuable than the giant things you can't! - @thanatokephaloides. On Twitter @wink1radio. (-2.1) All about building progressive media.
I appreciate your effort, but you can't address this issue
while accepting the premise established by the opposition.
I believe I understand the temptation to just accept it and move on. The ignorance of the subject is nearly ubiquitous, there is almost nothing, that runs less than an hour, that you can link to that lays out accurate information and counters the popular misconceptions that make it possible for reasonable, rational, entirely well-meaning people to believe complete nonsense.
But, that's where we lose.
The false premises that this fantasy is built on are daunting, but we cannot ignore them because they are how we got to this point of absurdity.
We can be subjected to this manufactured crisis explicitly because we accept the conditions imposed by the lies they tell.
If you believe, as you apparently do, that people can be convinced by reason, you have to be prepared to follow through as far as necessary.
The rent is, in fact, too damned high.
Now, it's our job to explain why that is without conceding the argument to the rentiers.
traditionally, some european cultures have had a use it or lose
it attitude towards private property. if you aren't living in or renting out a housing unit, and somebody moves into it, they enjoy various squatter's rights.
whereas in most places in America, if you were squatting in an otherwise vacant house and the landlord sent in private security thugs who shot you dead, there would be no charges filed.
the difference is wholly and entirely one of tradition and mindset, rather than of sacred propertarianist rights. (or rites, for that matter)
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
Doesn't anybody remember how Occupy started?
They started by occupying and renovating unoccupied and distressed buildings. The MSM has conveniently forgotten about these blatantly revolutionary acts and instead claims that it all started with students.
This one is of course probably a Berenstein Bears situation, because I am having a hard time finding photos of this, although I have an extremely clear memory of it. It seems to have completely vanished from the conversation.
Am I just remembering this wrong? Because I CLEARLY remember young guys and gals my own age hanging occupy signs and bragging about how they were making the place livable.
I do not pretend I know what I do not know.
Occupy Abandoned Houses
That was clearly an Occupy tactic. In fact, a brilliant innovation was to check the owner's ID at the County Assessor's office and draw up a fake rental contract with Office Depot legal forms and show it to the person who came with an eviction notice.
Out of state or foreign property owners could be difficult or impossible to contact. BAMM! Semi-legal residence established.
"They'll say we're disturbing the peace, but there is no peace. What really bothers them is that we are disturbing the war." Howard Zinn
I cannot afford to live out of subsidized housing
here in Portland.
My disability is a whopping 1,470 a month, of which 771 goes to my share of the rent. Add in an average of 2-300 for bills, and I have about 10 dollars a day to live on. If it weren't for food stamps, All I would have enough for is food.
I don't even want to think what would happen if I didn't have a good public transportation system, libraries, etc... The gutting of the commons affects the poor more than anyone else.
Discrimination against the poor is still very much socially acceptable. Usually under the guise of "Hygiene" (3 bucks a load at the laundromat nowadays. Six if you want dry clothes. Family of 3 adds up FAST), "Crime" (Inability to pay bills can get you arrested nowadays.) or "racist/sexist" (For not kowtowing to rich members of "Oppressed" groups)
I do not pretend I know what I do not know.
synthetic fabrics aren't to everyone's taste
but one advantage they have is that they spin down to almost dry in the washer, and then dry in 1/3 the time in the dryer. watch for 100% polyester or nylon socks and underwear on sale, and buy fleeces, 100% polyester sweaters, sweatpants and sweatshirts, and nylon/poly track pants down at St. Vinnie's, and you'll save real money at the laundromat. (They're also lighter weight in the washer, so you can wash more of them in a single load ...)
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
depending on the pricing, you can also save some by
running double-size loads in the big front-loaders. it's not usually a big saving on the washer, but because they spin at much higher speeds, cotton clothes come out much closer to dry.
generally, if possible run your synthetics separately from your cottons and cotton/poly blends. you'll get more efficient spin-drying of both, and much more efficient drying.
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
Sorry, i'm one of the lucky ones here...
I actually have a washer/dryer in my unit. I just remember what it was like trying to keep my kids clothes clean without it. (Did it for almost 5 years)
Thanks for the advice though, and I'm sure that it will help somebody who isn't as lucky as I am right now. (Amazing how Clean Natural Fabric Clothes counts as being Fortunate nowadays, isn't it?)
I do not pretend I know what I do not know.
well, yeah, but everyone has a microwave oven,
so nobody's poor.
The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.
I feel like we're going to have to go back to
multi-generation and/or multi-family dwelling situations as these fuckers are not ever going to stop this. I dream every single day of buying some piece of land and establishing my very own little commune. I want to just run from this, I know that is not the real answer but my God, I'm not even poor, YET, but they'll make it so that we all are, no matter what we did to try to mitigate that by "saving" and "doing the right thing." The anger is overwhelming.
Only a fool lets someone else tell him who his enemy is. Assata Shakur
We're already seeing plenty of that.
Lots of People living with their parents and doubling and tripling up on roommates well into their 30s because nobody can afford to live on their own any more. It's ridiculous. Ten years ago I had a two-bedroom apartment to myself (and my cat) for $500/month. It wasn't great but it wasn't awful. If it were up to me it would be just me and my husband in a big house full of cats and books. Sigh.
This shit is bananas.
Thought of joining Svanholm Collective in Denmark when younger,
but, among other impediments, I never got around to learning Danish.
http://svanholm.dk/index.php?id=73