Housing

Thom Hartmann - Housing is about five times more expensive (relative to income) than it was in the 1950s.And now we’ve surged past a new tipping point, causing the homelessness that’s plagued America’s cities since George W. Bush’s deregulation-driven housing- and stock-market crash in 2008, exacerbated by Trump’s bungling America’s pandemic response.And the principal cause of both that crash and today’s crisis of homelessness and housing affordability has one, single, primary cause: billionaires treating housing as an investment commodity.

A new report from Popular Democracy and the Institute for Policy Studies reveals how billionaire investors have become a major driver of the nationwide housing crisis. They summarize in their own words:

— Billionaire-backed private equity firms worm their way into different segments of the housing market to extract ever-increasing rents and value from multi-family rental, single-family homes, and mobile home park communities. 

— Global billionaires purchase billions in U.S. real estate to diversify their asset holdings, driving the creation of luxury housing that functions as “safety deposit boxes in the sky.” Estimates of hidden wealth are as high as $36 trillion globally, with billions parked in U.S. land and housing markets.

— Wealthy investors are acquiring property and holding units vacant, so that in many communities the number of vacant units greatly exceeds the number of unhoused people. Nationwide there are 16 million vacant homes: that is, 28 vacant homes for every unhoused person.

— Billionaire investors are buying up a large segment of the short-term rental market, preventing local residents from living in these homes, in order to cash in on tourism. These are not small owners with one unit, but corporate owners with multiple properties.

— Billionaire investors and corporate landlords are targeting communities of color and low-income residents, in particular, with rent increases, high rates of eviction, and unhealthy living conditions.  What’s more, billionaire-owned private equity firms are investing in subsidized housing, enjoying tax breaks and public benefits, while raising rents and evicting low-income tenants from housing they are only required to keep affordable, temporarily.

 NPR -Despite the Federal Reserve cutting interest rates by a half-point last month, mortgage rates have continued to tick upwards. According to the latest data from the Federal Home Loan Mortgage Corporation, the average 30-year mortgage rate has increased to 6.4%. Why this is happening and what it means for potential homebuyers.