by Peter St. Onge
Evictions are soaring, and Americans can’t pay the rent, potentially throwing hundreds of thousands of families out of their homes at a time when homeless shelters are jammed to the rafters with 10 million illegal immigrants.
It’s a useful reminder that the problem with our ruling elite isn’t just President Joe Biden’s dementia. They’ve made a very big bed we’re all going to be lying in.
The numbers come from The Wall Street Journal, which reports that since the [COVID-19] pandemic, evictions are up 15 percent in 10 of the 33 cities they survey. In a half-dozen major cities, including Houston, Phoenix, and Las Vegas, evictions are up 35 percent since pre-pandemic. Last month, Phoenix landlords filed more eviction notices than the peak of the 2008 crisis.
Note the jump isn’t nationwide, for the simple reasons that most blue cities make it nearly impossible to evict a renter who won’t pay. Meaning, the landlord is eating the rent, presumably making plans to sell out since no good deed goes unpunished in the progressive utopia.
That means unpaid rent is rising much faster than evictions. The eviction bans are hiding it.
To give a sense of unpaid rent, the Seattle Housing Authority reports low-income tenants with overdue rent is up 322 percent since pre-pandemic, while Seattle’s Low Income Housing Institute estimates it’s up 559 percent.
What’s driving it, of course, is the doubling of housing from the money-printing orgy that took the number of dollars from $15 trillion in 2019 to nearly $21 trillion—a 40 percent increase. Meaning, one in three dollars has fresh ink.
Toss in the Fed’s rate hikes that took [mortgage rates] from 3 percent to 8 percent, along with property tax and home insurance that’s soaring above inflation, and you’ve got the perfect storm that’s knocking people out of the game and on to the street.
So, what’s next? Housing’s not getting any cheaper, but the economy’s getting worse—meaning: jobs, incomes, and ability to pay the rent.
In yesterday’s video, I mentioned major banks are now projecting both ongoing inflation and high interest rates, which will continue to pump housing costs that will pass on to rents.
So, it’s going to get worse for renters, of whom nearly half are already “cost-burdened,” meaning they spend more than 30 percent of their income on housing and utilities.
One in three renters spend over half their income on rent. If the income falters, the rent won’t get paid.
Now, you might think that with an election looming, Washington would be trying to pitch in. Perhaps cut back on the artillery for Ukraine and the million-man migrant shelters to bring down inflation and [interest] rates.
Or perhaps making it easier for landlords to protect themselves, so more people are willing to convert their basement into an apartment.
Of course, Washington is doing no such thing.
Instead, the Department of Housing and Urban Development just announced a $40 million program to hire lawyers to force landlords to eat the rent even when the renter has no intention of ever paying.
Which hides the problem, at the expense of bankrupting tens of thousands of landlords and sending a clear message to any future landlord to never, ever rent to anybody who stands the remotest chance of not paying the rent.
That slams the door on blue-collars, recent grads, and young families hoping to find a place to live that isn’t Mom’s basement.
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Peter St. Onge is a visiting fellow at The Heritage Foundation.
Photo “Eviction Notice” by Allan Vega.
