Housing

Ah, private equity; is there any bad situation you can't make much, much worse?

In the midst of an affordable housing crunch and with yearslong Section 8 voucher waitlists, manufactured homes tend to be a more affordable option compared with traditional site-built houses, particularly for seniors and low-income households. A factory-built home can be a steppingstone for families pursuing homeownership or the last stop before falling into homelessness. But advocates say manufactured housing is quickly becoming unaffordable as private equity firms buy up parks and raise rents. In some cases, it’s unclear who owns the lots, making it easier for maintenance problems to go unaddressed.

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A household that lives in a manufactured home may own the structure but rent the land on which it sits. For many, “mobile” may be a misnomer.

“It's difficult, expensive or outright impossible to move these homes and so residents are forced to tolerate escalating rents, arbitrary fees, lack of transparency in billing and failure to invest in the maintenance of park properties, all which contribute to their housing insecurity,” said Esther Sullivan, a professor of sociology at the University of Colorado Denver, at the Senate committee hearing.

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“It's really frustrating as someone who has spent time in social services for so long to not be able to help people, particularly when they're in your city and you should have some jurisdiction over situations like these, where the living conditions are compromising the residents’ health, safety and well-being. We should be able to do something and hold those people accountable,” said Warren City Council President Angela Rogensues, who spearheaded the nuisance complaint.

Rogensues told state lawmakers last month that many parks are in “tremendous disrepair.” She reported seeing residents dealing with rat infestation, trees growing through trailers, trip hazards and trailers filled with garbage in 2022. Rogensues said she reached out to city and state departments and was told they didn’t have jurisdiction over mobile home parks. The city cannot test to regulate the water once it enters the park, she said, meaning the owner is responsible for the water quality. 

“Renters of mobile homes and even owners of mobile homes do not fall into a category I can regulate or enforce,” she told lawmakers.

The residents of dozens of public housing towers in the southern Australian city of Melbourne heard the state government was planning to demolish their homes on the news.

“Everyone found out from the TV, from the news, with the rest of Victoria,” Sara*, a resident of the first group of towers to be knocked down, told Al Jazeera.

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The government says the renewal will boost “social housing by at least 10 percent”, a modest increase in a city where there is already a huge gap in affordable housing.

According to Australian census data, the percentage of Australian households who rent their home from a state or territory housing authority dropped from 6 percent in 1999-2000 to 3 percent in 2019-2020.

In the state of Victoria, the share of housing classified as public or community housing, is just 2.8 percent.

By comparison, in Paris and Vienna, the share of public housing has increased since the 1990s, with about 25 percent of the population of both cities now living in socially-rented housing.

This is just great.

Housing is an investment. And investment prices must go up. Housing is shelter. When the price of shelter goes up, people experience distress. Housing can’t be both a good investment and broadly affordable—yet we insist on both. This is the housing trap.

In response to rent increases, the Texas capital experimented with the uncommon strategy of actually building enough homes for people to live in. This year, Austin is expected to add more apartment units as a share of its existing inventory than any other city in the country. Again as a share of existing inventory, Austin is adding homes more than twice as fast as the national average and nearly nine times faster than San Francisco, Los Angeles, and San Diego. (You read that right: nine times faster.)

The results are spectacular for renters and buyers. The surge in housing supply, alongside declining inbound domestic migration, has led to falling rents and home prices across the city. Austin rents have come down 7 percent in the past year.

One could celebrate this report as a win for movers. Or, if you’re The Wall Street Journal, you could treat the news as a seriously frightening development.

“Once America’s Hottest Housing Market, Austin Is Running in Reverse,” announced the headline of the top story on the WSJ website on Monday. The article illustrated “Austin’s recent downswing” and its “glut of luxury apartment buildings” with photographs of abandoned downtown plazas, as if the fastest-growing city of the 2010s had been suddenly hollowed out by a plague and left to zombies and tumbleweeds.

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If homeownership is best understood as an investment, like equities, we should root for prices to go up. If housing is an essential good, like food and clothing, we should cheer when prices stay flat—or even when they fall. Instead, many Americans seem to think of a home as existing in a quantum superposition between a present-day necessity and a future asset.

This magical thinking isn’t just a phenomenon of real-estate reporting. It is deeply rooted even in the highest echelons of policy making.

California State Assembly member Lee is one of a small number of voices leading calls for a new social-housing programme to alleviate America's severe housing-affordability problems.

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"This idea that the government shouldn't be doing certain things is one of these weird, subconscious beliefs that a lot of Americans have," he continued.

"If we tried to create public libraries, public schools, and social security today, it would probably be labelled as some great Marxist scheme."

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"I think more people are coming around to the idea that the current system of housing we have is fundamentally broken," Lee said.

"Anyone who says that just doing a little bit of that and a little bit of this fix to it is, I think, completely wrong."

Lee is doubtful that it will be possible to increase housing supply sufficiently to improve affordability through the market alone – where the profit motive means there is little incentive to bring rents and house prices down.

"The free market is working as intended today, where sky-high rent prices and housing prices are driving people away from their home communities – that's the market at work," he said.

"Without an intervention of the public sector, which we want through social housing, there cannot be a solution entirely to the housing crisis."

Social indicator alert:

Women and children in New South Wales are being offered a car park to sleep in overnight as part of a pilot program aimed at keeping those experiencing homelessness and domestic violence safe.

The program is being run by an organisation in Newcastle, which has not disclosed its name, for fear of giving away the location. But Nova, the housing assistance service for women and children fleeing domestic violence, has been referring people to the pilot, which began in April and will run until June.

It comes as the NSW government announced on Friday it would develop an urgent emergency package within days to address the domestic violence crisis in the state.

The “Women in Cars” project, offers those staying in the car park food and drink, showers, toilets, laundry, kitchen facilities and access to television. Dogs are allowed and security and support is also on site.

Wouldn’t it be wonderful if the housing crisis could be solved without building any more homes? There would be no carbon emissions from construction sites, no green fields covered over, no householders upset at dwellings appearing in their view. Instead, rents would become affordable and decent homes available through changes in government policy. Such is the promise of Against Landlords by the author and barrister Nick Bano, a man who has been described as “Britain’s top Marxist housing lawyer”.

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Bano would like to return, with due allowance for the fact that public housing of the time was sometimes less than perfect, to the 1970s to complete the project of driving “landlords and house-price speculators from the face of the earth”. He wants to reinstate rent controls and end no-fault evictions. It’s not entirely clear how people currently privately renting would then be housed (though it seems likely that they would become tenants of the state), or how the transition would be effected. He acknowledges that it might be a brutal process, given the dependency of the national economy on property values, perhaps involving a monumental property crash.

Bano’s arguments have already taken a bit of a battering, both from more centrist commentators and, doubtless to his delight, from the rightwing thinktank the Institute of Economic Affairs (“an edgy Maoist rebel”, it called him). These critics question, with some reason, his basis for saying that there are enough homes, in light of the fact that studies tend to show that Britain has the smallest new-build homes in Europe.

Even the Tories’ political education department had no real objection to the further reduction of the tiny private rented sector that existed in the 1970s. It wrote: “The accelerating decline of the privately rented sector is quite irreversible. The private landlord, as he exists now and has existed, will, within a generation, be almost as extinct as the dinosaur. There is nothing that can be done about this.” Conservatives in the 1970s merely sought to retain a handful of petty landlords, who ought to be entitled to a “fair return” if they let out a spare room or two, but they recognised that private renting tends to be an expensive, poor-quality and economically wasteful way of accommodating the population. The near-death of landlordism was one of the good news stories of the last century.

But the task that Thatcher and her successors set themselves was to undo that progress. The present system was designed, as the supreme court noted in a tenant’s 2016 human rights challenge, to ensure that “the letting of private property will again become an economic proposition”. It should have been obvious to everyone that a market that had achieved such positive effects by its collapse would produce equal and opposite consequences as it was reinflated.

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The yimby argument has always seemed flimsy. Its strange logic is that speculative developers would build homes in order to devalue them: that they would somehow act against their own interests by producing enough surplus homes to bring down the average price of land and housing. That would be surprisingly philanthropic behaviour.

When we complain, rightly, that cities such as Vienna are so much more livable than anywhere in Britain, we must acknowledge that landlordism is holding us back. Our insistence on pursuing policies that ensure that letting private property is an “economic proposition” not only drives up prices for would-be homeowners, but it stands in direct opposition to a programme of municipalising and decommodifying the homes that already exist. It also inflates land values, making new state-led building projects unfeasible. If we want a Viennese-style existence we can only achieve this, as we did 50 years ago, by driving the landlords out. Which is only fair: we have given them a very good innings.

Melbourne’s Missing Middle’s signature recommendation—a new Missing Middle Zone—would enable six-storey, mixed-use development on all residential land within 1 kilometre of a train station and 500 metres of a tram stop—building an interconnected network of 1,992 high-amenity, walkable neighbourhoods.
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Melbourne’s Missing Middle envisions Parisian streetscapes across all of inner urban Melbourne, along our train and tram lines and near our town centres. Gentle, walk-up apartments, abundant shopfronts, sidewalk cafes and sprawling parks replacing unaffordable and unsustainable cottages. 
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The Missing Middle is the most desirable, walkable urban form, typified by inner Paris, and it should be legal to build in our most desirable, economically productive areas.

While only a small provider of accommodation in Australia (0.03% of all homes compared to Sweden’s 22%), new research reveals how developing the sector could relieve some of the pressure.

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Tenant-members expressed high levels of satisfaction with their living arrangements, a strong sense of home, solid social bonds, and an improved sense of health and wellbeing. These positives were shared with their children.

Importantly, our study found participants had a strong sense of agency and voice, which is often missing in other housing tenures, especially renting.