Read on Twitter
A slow moving crisis is happening, folks.
12 million #renters will owe an average of $5,850 in back rent and utilities by the end of the year.
This is the kind of cascade that could hurt not just those directly involved, but many more.
A thread...
12 million #renters will owe an average of $5,850 in back rent and utilities by the end of the year.
This is the kind of cascade that could hurt not just those directly involved, but many more.
A thread...
Imagine: Renter with a job in #hospitality is unemployed through no fault of their own - their industry is on life support due to #COVID19. (15% #unemployment in hospitality, BTW). https://www.travelagentcentral.com/your-business/stats-leisure-hospitality-unemployment-double-national-average
Renter is living month to month (As the @federalreserve found that most are) and falls behind in their rent - let's say they're now 6 months behind. https://www.federalreserve.gov/publications/2020-economic-well-being-of-us-households-in-2019-dealing-with-unexpected-expenses.htm
$6K debt by the end of the year will be typical, as illustrated in @washingtonpost by @byHeatherLong. https://www.washingtonpost.com/business/2020/12/07/unemployed-debt-rent-utilities/
Most American landlords own just 1 or 2 rentals and depend on the income from those rentals for their own expenses. Yes, they are better off than renters, but many struggle to make their mortgage payments. @Harvard_JCHS covers them well. https://www.jchs.harvard.edu/blog/who-owns-rental-properties-and-is-it-changing
The Renter is $6K behind, but the bank still needs their mortgage payments, the insurance needs to be paid.
Something goes wrong - furnace fails, roof needs to be replaced.
Landlord can't make the mortgage payments and loses the property to the bank.
Something goes wrong - furnace fails, roof needs to be replaced.
Landlord can't make the mortgage payments and loses the property to the bank.
Now the bank owns the rental...and it's a non-performing asset. Will the bank be more compassionate to the renter than the landlord would have been? They don't have a relationship with the renter at all...and a fiduciary duty to their investors - not to the renter.
Banks are already getting ready for this firestorm, underwriting the risk of mass real estate losses as covered by @davidjlynch. https://www.washingtonpost.com/business/2020/11/11/commercial-real-estate-economy/
Renter is evicted by the bank and potentially homeless, landlord loses their property and gets their credit destroyed. Bank ends up with a property that they can't manage and shareholder / taxpayer value destruction is massive.
Wouldn't it be better to address the problem now, keep the renter in their place and the landlord in theirs?
We're talking about 12 million renters behind on their rent by the end of the year. This is a problem on a massive scale, big enough to cause a tidal wave of crisis.
We're talking about 12 million renters behind on their rent by the end of the year. This is a problem on a massive scale, big enough to cause a tidal wave of crisis.
In addition to those I've mentioned, many other great writers have written on this topic ( @ConorDougherty, @francescamari, @SFjkdineen, @dillonliam, @patrickcsisson to name a few).
I put together some thoughts on this a while back. Let's do something and not just let this slow motion crisis unfold as a result of inaction. https://blog.dwellsy.com/renters-need-help-too/
