http://www.nytimes.com/2014/04/15/b...30-affordability-ratio-unattainable.html?_r=0
Just thought this was interesting, potentially a consequence of the growing rift between the wealthy and everyone else.
I make a salary considerably above the median wage in my city and I live in a small apartment that I share with another guy (a lawyer), in a cheaper part of the city. There are certainly people who make what I make and live in more expensive housing, choosing to be "apartment poor" I guess.
I also own three modest houses (~1,000 sq. ft. apiece), and there are a total of 18 people living in them, spread across six nuclear families. Each of these households has multiple wage earners. (None are section 8, although I'm sure there's government assistance going on in some way).
I'm not groussing or complaining or anything, I just see this as a quiet way the middle and working classes are adjusting to the new reality.
I posted on this the other day here:
http://forums.anandtech.com/showthread.php?t=2378402&highlight=
Here is some of what one of the other article said:
The Blackstone Group, a private equity firm, is now the largest owner of single-family rental homes in the country. In one day alone, Blackstone bought up 1,400 houses in Atlanta. And as private equity firms gobble up huge swaths of the housing market, they are partnering with big banks to bundle the mortgages on these rental homes into a new financial product known as "rental-backed securities," reminiscent of the "mortgage-backed securities" that helped cause the last financial crisis.
Could this new private equity rental empire help spark the next housing crisis? We are joined by Laura Gottesdiener, author of "A Dream Foreclosed: Black America and the Fight for a Place to Call Home," who calls this wave of purchases "a land grab." Gottesdieners latest article focuses on New York Citys rental market, a case study in what critics call "predatory equity." Large firms have used abusive tactics to oust tenants in a bid to hike up rents and tenants have been resisting. We are also joined by Benjamin Warren, who, along with nearly 1,600 families in 42 buildings, is a victim of one of the largest single foreclosures in the citys recent history.
You may not have heard of the Blackstone Group, but its the largest private equity firm in the world. And now its become the largest owner of single-family rental homes in the country. Over the last few years, Blackstone and other Wall Street firms have been quietly grabbing up huge swaths of the rental housing market, purchasing more than 200,000 cheap homes, hoping to turn a profit. At one auction in Atlanta, Blackstone swept up 1,400 houses in a single day. A new report released Wednesday by Right to the City Alliance found like Blackstone tenants in Atlanta had reported a range of issues, from burst pipes and exposed plumbing to bed bugs, which their Wall Street landlord has been slow to fix. In addition, private equity firms are partnering with big banks to bundle the mortgages on these rental homes into a new financial product known as "rental-backed securities," reminiscent of the mortgage-backed securities that crashed the economy in 2007 and 2008.
Now a new article turns the spotlight on New York City, a case study on what critics call "predatory equity." Here in New York, private equity firms have bought up rent-regulated properties, hoping tenants will leave so they can hike up the rent. When tenants fought to stay, the firms resorted to predatory tactics, from sending out fake eviction notices to shutting off heat or water. Right now in New York City, 1,600 families in 42 buildings are falling victim to one of the largest single foreclosures in the citys recent history, after a conglomerate of private equity firms failed to pay its mortgage.
For more, were joined now by two guests. Ben Warren is with us. Hes a housing advocate who has been part of his buildings tenant committee in the South Bronx since the 1980s. Hes a tenant in one of those 42 buildings now being hit by the massive foreclosure, member of Community Action for Safe Apartments, orCASA. And Laura Gottesdiener is with us, the author of A Dream Foreclosed: Black America and the Fight for a Place to Call Home. It was published by Zuccotti Park Press. Shes an editor at Waging Nonviolence. Her most recent piece for TomDispatch is called "When Predatory Equity Hit the Big Apple: How Private Equity Came to New Yorks Rental Marketand What That Tells Us About the Future."
Weve been looking at the growth of this single-family rental empire across the country, what we hear over and over again is that this is an utterly unprecedented phenomenon, that nothing like this has ever happened in the history of the United States. In many ways, thats true. But in other ways, in New York City, we have this case study of what its looked like over the last decade when private equity firms have gone in and seen what they consider to be opportunities in the housing market to make a lot of money really quickly. I know this is something, Juan, that youve covered extensively for the Daily News. And whats important to see, both in this case right now that Benjamin is living through and that 1,600 other families are living through and in a slew of other past very high-profile deals, is that this has been something of a disaster not just for tenants, but also from a financial perspective. These are deals that they were betting bigthese private equity firms were betting big that they could turn these buildings around by pushing out hundreds of thousands of families. They weren't able to push out families, because families organized. And as a result of that organizing, these deals failed, and it made a situation where the broader housing market in New York City got hit and these tenants had to live in completely inhumane conditions.
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