“What if you come home and find strangers living in your house?
I assumed you order the squatters out, and if they resist, call the police, and they will kick them out.
Wrong.
Pro-tenant laws passed by anti-capitalist politicians now protect squatters. If a squatter just lies about having a lease, the police won’t intervene.
“It’s a civil matter,” they’ll say. “Sort it out in court.”
Great. Court might cost $20,000. Or more. And courts are so slow, eviction might take years.
In my state, New York, homeowners can’t even shut off utilities to try to get the squatter out. That’s illegal. Worse, once a squatter has been there 30 days, they are legally considered a tenant.
This month, New York City police arrested a homeowner for “unlawful eviction” after she changed locks, trying to get rid of a squatter.
“Squatter rights,” also known as “adverse possession” laws, now exist in all 50 states. As a result, evicting a squatter legally is so expensive and cumbersome that some people simply walk away from their homes!”
“Higher rents and home prices are a natural consequence of local and state zoning laws, labyrinthine approval processes, federal restrictions on mortgage financing, and environmental reporting laws, to name a few.
All these laws limit the supply of new housing, which drives up the price for any given level of demand. That’s a diagnosis the Biden administration itself has endorsed in various housing briefs and “action plans.”
Despite that insight, the president’s proposals to subsidize home buying will, all else equal, increase demand while leaving supply constraints in place. That will only raise prices further.”
“Documents shared with Reason show the rents paid by several New York City tenants at their rent-stabilized apartments. Other documents shared with Reason, as well as public property information, show the same tenants own additional property worth north of $1 million. Some of these rent-stabilized tenants are themselves landlords who rent out their properties for more than what their rent-stabilized apartments cost.
That includes a married couple with a four-bedroom home in the tony community of East Hampton, New York. The husband is a wine broker. The wife is a real estate associate with Sotheby’s International Realty. A county document show their East Hampton property has an appraised value of $2 million.
The couple’s address on that same document is a rent-stabilized apartment in Lower Manhattan where the legal rent as of September 2023 is $931 a month. Online rental listings show market-rate one-bedroom apartments in the same neighborhood renting for anywhere from $3,000 to $7,000.
Another woman, an anthropologist with her own consultancy firm, is listed as the lessee of a Brooklyn Heights apartment with a legal monthly rent of $2,436. Market-rate one-bedroom apartments in the same neighborhood go from $4,000 to $5,000 a month.
County property records show that the same woman owns a home in the Long Island community of Greenport, New York. She advertises it as a vacation home for rent on her personal website, and it’s listed on several rental websites with a quoted monthly rental price of $12,000.”
“This is all perfectly legal. New York’s rent stabilization law has no means-testing requirements. That means people of any income can benefit from its suppressed rents.
Wealthy tenants are getting some of the best deals out of the state’s rent stabilization law. An in-depth Wall Street Journal analysis from 2019 found that regulated rents in richer Manhattan are around half that of market-rate rents. Regulated rents in working-class areas of Queens and the Bronx are at most few hundred dollars less than market rents.
Higher-income rent-stabilized tenants were paying 39 percent less rent on average than their peers in market-rate apartments. Lower-income rent-stabilized tenants were paying only 15 percent less than their peers in market-rate apartments.”
“It takes San Francisco three years on average to fully approve new housing projects, the longest of any jurisdiction in California, according to an audit published by the state Department of Housing and Community Development (HCD) in October.
The very predictable result is that the Golden State’s fourth-largest city is also one of the nation’s most expensive, with median one-bedroom rents above $2,000 and a median home value of $1.4 million.
That San Francisco is expensive because it takes forever to approve new housing isn’t a new finding. Whether the city will actually get rid of the regulations gumming up home construction is now coming to a head.”
“top-down reforms like the one proposed by Pressley and Tlaib would shift more of the risk of housing ex-cons onto landlords. The result is both unjust and counterproductive.
Remember the Obama-era initiative to “ban the box”? Reformers sought to boost the job prospects of persons with criminal records by prohibiting employers from asking about applicants’ criminal histories. It was another well-meaning idea, but one that overlooked unintended consequences. Preventing employers from discriminating based on criminal history didn’t remove the desire of some employers to avoid hiring criminals; it just forced them to use poor information. More employers began discriminating against black and Hispanic applicants. Evidence suggests a similar outcome if criminal background checks of tenants are restricted. A study published by the Federal Reserve Bank of Minneapolis found that when the use of background checks and other information was restricted in that city, racial discrimination in housing increased relative to nearby St. Paul, where no such restrictions were in place.”
“According to Freddie Mac, the rate for a 30-year fixed-rate mortgage has climbed to 7.09 percent, an uptick from the 5.13 percent it was at a year prior.
A mortgage rate is “the interest rate charged for a home loan,” and effectively the monthly cost of borrowing that money. As mortgage rates have gone up, monthly payments have gotten more and more pricey for people looking to purchase a home even if the base price of the house stays the same.
For example, under a 3.22 percent 30-year fixed mortgage rate in January 2022, the monthly payment on a $400,000 house in New York with a 20 percent down payment was $1,716, per a Bankrate calculator. Now, under a 7.09 percent mortgage rate in August 2023, the monthly payment on the same house with the same price would be $2,477.
Such costs have had an impact on the housing market: As mortgage rates have increased, some potential buyers have held off on purchasing houses, while sellers have similarly been less likely to list their property. For current homeowners, there’s a major incentive to wait until rates go down before deciding to re-enter the market and search for their next house.
“These higher mortgage costs are a tremendous barrier to entry for anyone wanting to enter the housing market,” Gregory Daco, the chief economist for Ernst & Young, tells Vox.”
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“One of the biggest factors in the rise in mortgage rates is the Fed’s approach to monetary policy, which includes interest rate hikes aimed at combating inflation.”
“If a property owner can’t properly vet tenants and potentially can’t evict them, then they aren’t going to invest in or rent out apartments. They certainly aren’t going to make repairs to houses lived in by non-paying tenants, which will make the housing stock less adequate. We need more housing, not less, and such edicts discourage housing investment.”
“They found that banning investors from buying and converting housing to rentals worked in one sense: The share of investor-owned rental properties in affected neighborhoods fell, and the number of properties bought by first-time homebuyers increased.
On the other hand, however, these new homeowners tended to be richer than the renters they were replacing, and the costs of rental housing increased overall.
“The ban has successfully increased middle-income households’ access to homeownership, at the expense of buy-to-let investors. However, the policy also drove up rents in affected neighborhoods, thereby damaging housing affordability for individuals reliant on private rental housing, undermining some of the intentions of the law,” write researchers in the study published on SSRN.”
“Every year, more than 600,000 people leave US state and federal prisons. Then they need to find a place to live.
Researchers have found that formerly incarcerated individuals are far more likely to be homeless than the general public. Many landlords simply reject renting to applicants who’ve been to jail or prison — and given that one in three US adults has a criminal record, this creates a significant housing crisis.
But those released with stable housing are more likely to reintegrate into their communities and less likely to end up back in prison than their formerly incarcerated peers in more precarious housing situations.
Enter “fair chance” laws: legislation that limits how landlords can use criminal records when screening prospective tenants. While the ordinances vary from place to place — some cover all rental housing while others just apply to subsidized housing — the goal is to limit how criminal histories can be used and ensure due process for prospective tenants when applying.”
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“For now, the only rigorous study on fair chance housing ordinances comes from a working paper series at the Minneapolis Federal Reserve, where two economists looked at the effects of a law the Minneapolis city council passed in 2019.
The local law caps security deposits at one month’s rent, bans the use of credit scores in rental applications, and restricts landlords’ ability to reject people based on evictions that occurred more than three years prior. For criminal records, landlords can no longer reject applicants due to misdemeanors older than three years, felonies older than seven years, and certain more serious convictions older than 10 years.
The economists submitted fake email inquiries to publicly listed rental ads using names chosen to sound like Black, white, and Somali people. (Minnesota has the largest Somali population in the US.)
The researchers found that after Minneapolis’s fair chance ordinance took effect, discrimination against Black and Somali applicants increased by over 10 percentage points for both groups, relative to those in neighboring St. Paul, which did not have such a law. Differences were largest for emails sent from Black and Somali male-sounding names, for apartments that were at least two bedrooms, and for units in historically Black neighborhoods. (The researchers couldn’t identify individual companies that discriminated, but could observe discrimination based on overall contact rates to randomized emails sent to large groups of properties.)”
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“it’s impossible to tell which aspect of the law — be it limiting eviction history, credit history, or criminal records — might be causing the effect.”
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“In 2021, New Jersey passed a statewide fair chance housing law with bipartisan support, and with backing from landlord groups. It doesn’t go as far as Seattle’s ordinance in restricting how criminal histories can ultimately be used, but it comes with a strong enforcement mechanism.”
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” With the exception of convictions related to producing methamphetamine and being listed on a sex offender registry, landlords can never ask about an applicant’s criminal history in the first round of applications, and they can only evaluate a criminal record after a conditional housing offer has been made. If a landlord finds a serious crime committed relatively recently, they can withdraw the offer, explaining to the applicant in detail why, and the applicant has the right to appeal it or file a complaint with the state. A housing provider can never rely on arrests that didn’t result in convictions to reject an applicant.”