Financialization of trailer parks and single family houses
Trailer parks. The New Yorker has an article, "What Happens When Investment Firms Acquire Trailer Parks," about how large property firms and hedge funds are buying trailer parks, typically places of comparatively low cost housing, and significantly raising the cost of living there.
Traditionally, a household owns the trailer but rents the lot.
I've argued that community housing master plans should include trailer parks as a type and aim to put control of these properties into the social housing sector or community land trusts.
But cities, looking for higher revenue streams from property aren't inclined to take much initiative when it comes to this property type, especially when it comes to higher value redevelopment ("Trailer parks moving out of Fayetteville nothing new, officials say," Northwest Arkansas Democrat Gazette, "Centerville residents facing eviction in the middle of a pandemic, but not without a fight," Salt Lake Tribune).
Single family houses. After the Great Financial Crisis, when hundreds of thousands of houses went into foreclosure, large portfolios of scattered site single family houses were acquired by Wall Street investment firms.
Over time they made great profits from renting the houses out and property value appreciation ("When Wall Street Is Your Landlord," Atlantic, "A $60 Billion Housing Grab by Wall Street," New York Times).This also makes it harder for individuals to become homeowners, thereby reducing the quality of their household wealth portfolio.
New construction single family housing subdivisions for rental. Investment firms are taking this to a new level, by building new subdivisions from the ground up, but only for rental ("Wall Street’s New Suburban Subdivision Is Full of Renters," Bloomberg).
They're being pushed to do this, because they like the profits from rentals, but as the housing supply tightens it's harder for them to find good deals.
Labels: Depression/Recession/Global Economy, financialization, housing market, rental housing
8 Comments:
I hadn't seen that about Wall Street building single family subdivisions to rent out! They really are taking over all aspects of our lives! To say nothing of how the pandemic has greatly strengthened big business at the expense of small businesses! Awful
Local governments are downright hostile to mobile homes. You have a better chance of getting a monorail in a town than a new trailer park.
Here's an example, Florida City, Florida was deeded a trailer park in the 1980s, allegedly with a proviso to maintain affordability. They just sold it for redevelopment, evicting the tenants.
Miami Herald: Lawyers step in after Florida City tells trailer park residents they will be evicted.
https://www.miamiherald.com/news/local/community/miami-dade/homestead/article249963279.html
KUTV 2News: People in Weber Co. trailer park fear they'll be kicked out for new development.
https://kutv.com/news/local/people-in-weber-co-trailer-park-fear-theyll-be-kicked-out-for-new-development
The Dallas Morning News: Dallas developer and Canadian builder plan thousands of rental homes.
https://www.dallasnews.com/business/real-estate/2021/03/22/dallas-developer-and-canadian-builder-plan-thousands-of-rental-homes/
The case for trailer parks
https://theweek.com/articles/974140/case-trailer-parks
The Guardian: Landlord power is not just bad for tenants. It harms homeowners, too.
https://www.theguardian.com/commentisfree/2021/apr/10/landlord-power-homeowners-tenants-buy-to-let-property-labour
The Guardian article is imaginative, but foolish. "Hoarding" gives the impression that the thing hoarded was realistically available to the imagined benefactors. California's housing prices are stupid high for a variety of reasons. In some cases it is high because past generations put ordinances in place to prevent more building, thus limiting the housing supply, in the name of the environment. On the opposite end of the country, in Baltimore, you can buy a 3bdrm/1ba house for less than $50K. There are plenty of landlords who own more than 5 properties. There are laws, taxes, and other things that would discourage many B'more landlords but it's still a popular place to invest. And still, home ownership is less than 50%. In the US the home ownership rate hovers around 65% and the UK about the same amount. What would be the preferred rate?
At one point the rate in the UK was over 70%. To me that seems like an environment closed to the young, immigrants and others not in a position to purchase a home. Imagine wanting to move to a city, but you can't because there are no available rentals in that city because most people own their home and aren't interested in sharing their private space. There are neighborhoods in some European cities that are simply closed off because renters won't move and make units available and home owners stay put and don't sell.
As I said, this would not help the imagined benefactors.
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