The REASON Why We Do Not Have Enough Affordable Housing
(00:00.874)
The story was heartbreaking. It was an associated press story. And obviously, you read it and you have these anecdotal bits here and there talking about the record number of Americans that can’t afford their rent. And again, they talk about how, you know, they single people out here, for example, as a person in Denver, 10 years in their apartment, its rent has gone from $750 to $30.
three hundred dollars and one story after another. And again, none of these are happy stories. And people facing eviction no longer can afford the rent. They’ve got a few kids in there and I can’t help it. Can’t help but feel sorry for these people. But the title of the story is a record number of Americans can’t afford the rent. Lawmakers are scrambling to help. What lawmakers need to do.
is to get the hell out of the way. They, in the story they talk about, yeah, we’re gonna change the law and make it more difficult to evict people and we’re gonna have tougher rent control rules and all of these things. That is the reason why we don’t have enough affordable housing. And again, new listeners here. Yeah, I’m gonna.
It might blow your mind a little bit. Again, you’ve fortunately haven’t been taught econ 101. Let’s pretend that I am a developer contract or whatever it may be. And I’ve got a certain amount of money and I want to develop a piece of land. Now there’s a myriad of costs that are involved with building that piece of land. Restrictions might be local ordinances in regards to how much affordable housing I’m supposed to have if I want to build it. Let’s just say.
let’s just say I want to build a complex where it’s going to be geared towards a lower income, lower income demographic. Now, again, economies change, terrains change, there’s a myriad of different things. What I want to invest in build something like that, knowing that I might be hamstrung in regards to what I might be able to charge.
(02:27.65)
based upon the economic conditions and climate, would I want to go ahead and take that type of risk on? Kind of delve into this a little bit further. Why would I, let’s say the property taxes go up, let’s say that the costs of heat go up, let’s say the costs of the insurance costs go up, whatever it may be.
And I can’t turn around and pass those costs on down to the people that are renting for me. That’s, that’s a, you could be in a heap load of trouble. Not to mention the fact, not to mention the fact that, Hey, you know, you get people in and they, they can’t pay the rent. They stop paying the rent. And I’ve got, you know, I got a service, my mortgage as a landlord on this building.
and the people that are supposed to be paying me so I can service this mortgage are not paying me. And because of how difficult it is to evict people from these places, what am I gonna do?
Again, it’s brutal. Yeah, and again, I’m, you know, I’m basically, and this is not any sort of, what I put it, class type of a situation. I remember during the financial crisis, people living in multi-million dollar homes on Southwest Florida on the beach, knowing that it was difficult to evict them, stopped paying their mortgage on it and weren’t thrown out of the house.
They knew exactly how to play the rules of law. Yesterday in the public, we mentioned in Atlanta, you got 1200 homes and fancy Atlanta suburbs that are being, again, you got squatters in there. Can’t even throw them out.
(04:23.618)
That’s an added risk in whether or not I want to go ahead and build these units. Again, the government causes the problem and then throughout the system they talk about all of these again politicians. Here we come to save the day, try to run in. We’re going to do this, make it harder to evict. We are not going to allow them to raise rent a certain amount.
As a developer, someone that might go ahead and think about building these things, you’re gonna pausing and say, wait a second, the risk is too great. And that is the reason why, that is the reason why we don’t have enough affordable housing units here in the United States. It’s because of government rules and regulations. Watchdog on wallstreet.com.
