Matt I’ve been wondering this from across the Atlantic for some time: where are all the foreclosure people?
Millions have lost their homes across the US and yet with the exception of the odd ‘middle class person sleeping in car’ human interest story on CNN and a comment in this week’s Economist about parents within two parent families moving out of state for work I really can’t recall seeing much within my trusty US print sources on where these people are now living or the wider social consequences of this.
The essence of the housing bubble has been that the cost spread between owning a home and renting one got extremely wide. Thus, up until now it appears that most people who’ve lost homes due to foreclosures have been able to afford to move into rental housing. There are articles like “Foreclosures result in apartment boom” about landlords suddenly finding it much easier to get tenants. Of course you also have situations where tenants find themselves in trouble because their landlord is being foreclosed on.
But the last time I was in a foreclosure-heavy part of the country, I saw several rental properties that were being explicitly advertised with “Foreclosure Victims Welcome” banners. And googling for “foreclosure victims welcome” reveals that lots of folks all across the country are advertising their rental property in this way.
To some extent, though, this is yesterday’s story when the main news was the housing crash bringing low people who’d taken out loans they were never going to be able to pay. Since that time, the “real economy” has gotten quite a bit worse. That’s going to lead to a second generation of foreclosure victims — people who had the ability to make regular payments at the time they bought their house but who can’t make them now because they’ve lost their jobs. And when you don’t have a job it’s hard to pay rent, too.