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“Anyone middle-class and below, we’re screwed”: Housing costs are rising at their fastest pace in decades — but some Americans are already feeling the brunt

Damon Blanchard, a 46-year-old living in Columbus, Ohio, is unemployed but receives a biweekly worker’s compensation check worth about $686 after injuring himself while working at a junkyard three years ago, he said .

Last year, an investment firm bought the apartment complex where Blanchard lives — which he says is mostly black occupied — and eventually increased its rent from $450 to $970 in January. For this reason, he currently spends almost all of his income on rent.

How many tenants since the beginning of the pandemic Blanchard tried to organize with his neighbors and resist his landlord’s rent increases, though he said investment firm Vision and Beyond, which acquired his complex, was unwilling to negotiate with tenants as a group.

“Things are changing, but they’re only getting worse for the nation’s citizens. Anyone middle class and below, we’re screwed.


— Damon Blanchard, a 46-year-old living in Columbus, Ohio

The company did not immediately respond to MarketWatch’s request for comment, but has previously disclosed it to local media Investing in much-needed security and building improvements and the any rent increases are in accordance with comparable rental properties in the area.

“Things are changing, but they’re only getting worse for the nation’s citizens,” Blanchard said. “Anyone middle class and below, we’re screwed.”

Blanchard may be more vulnerable than one- and two-income households, but he’s not alone. When you rent out your home, you’re probably paying more than you’re used to.

Higher cost of living

That The Ministry of Labor announced on Wednesday that its consumer price index rose 8.3% in the 12 months to April, with the index rising 0.3% in the last month alone. While inflation has indeed slowed somewhat, Americans still bear the burden of higher living expenses, especially when paying for housing, groceries, plane tickets, and cars.

Housing costs – which for a middle-income household could be a third of the cost of a family pay home — are up 5.1% over the past year, the fastest annual pace since 1991, while rents are up 4.8% year over year work department.

While it’s not too surprising that housing costs are rising, “it’s worrying,” said Daryl Fairweather, Redfin’s chief economist. There’s not much that can be done in the short term to stem rental inflation, aside from raising interest rates, which the Fed is already doing, she added.

“It’s just unfortunate because there are people who will actually walk away poorer.”


— Daryl Fairweather, chief economist at Redfin

“I don’t think we’re anywhere near over the hill in terms of rent increases,” Fairweather said. “It’s just unfortunate because there are people who will effectively walk away poorer.”

Corresponding Rental dates from Redfin, the average monthly asking rent increased by 17% between March 2021 and March 2022, reaching $1,940. In some cities, rent increases were even more pronounced: Portland saw prices rise 40%, Austin 38%, and New York City 35%.

The increases essentially represent an adjustment period after the economy was effectively switched on and off during the pandemic, resetting house prices in a market that was already short of units, Fairweather said.

Still, this kind of momentum is not to be scoffed at and can have particularly dire consequences for low-income households without much wiggle room in their budgets. Rent increases are also likely to disproportionately weigh on Black and Hispanic families, who would be more likely to spend 30% of their spending Residential income even before the pandemic.

“Rentals eat first”

Housing advocates like to say that “rent comes first,” acknowledging that people will face higher housing costs while sacrificing their standard of living. So in the short term, low- to middle-income tenants could push through the rent increases at the expense of their savings, Health, and even hers future ability to own a home.

Otherwise, they face eviction or homelessness, which can have further disastrous consequences for their financial and physical well-being and, ironically, makes it harder for tenants to find a new rental home.

As a KNXV-TV, an ABC DIS,
-2.29%
branch in phoenix, recently reportedsome Arizona landlords turn away high-value tenants simply because they previously accepted financial assistance from the government or a nonprofit to help with the housing costs of a pandemic, and landlords have long discriminated against tenants with evictions on their records.

Biden vows to fight inflation

On Wednesday, President Joe Biden said his administration would step up efforts to fight inflation.

“I will continue to fight for family farmers like Jeff to do what they do best. I hope Congress will join me,” the president said at a farm in Kankakee, Illinois owned by Jeff and Gina O’Connor.

In his latest budget proposalThe Biden administration said it would increase US Department of Housing and Urban Development funding by nearly 21% to $71.9 billion in 2023.

The Biden administration said it will increase funding from the US Department of Housing and Urban Development by nearly 21% to $71.9 billion through 2023.

As Immobilienmakler.com noted by Biden’s plan: “The goal is to expand Rent Assistance to more low-income renters who are struggling to pay their landlords, increase the number of affordable housing units available, and help more Americans become homeowners. There is also money in his budget that is earmarked Fight against housing discrimination.”

(Realtor.com is operated by News Corp subsidiary Move Inc., and MarketWatch is a unit of Dow Jones, which is also a News Corp subsidiary.)

But critics say more needs to be done. Biden, for example, made little mention of rents in his State of the Union address last February, even though rents have been rising for some time, further complicating Americans’ ability to save for a home.

Damon Blanchard, meanwhile, is still waiting for more government support in his own fight against landlord rent increases. “There is no policy to protect people,” Blanchard said. “It’s all corporate driven, it’s all capitalist driven, it’s all money. And because we don’t have it, we have to organize to fight for ourselves.”

https://www.marketwatch.com/story/anybody-thats-middle-class-and-below-were-screwed-housing-costs-rise-at-the-fastest-pace-in-decades-but-some-americans-are-already-feeling-the-brunt-11652327702?rss=1&siteid=rss “Anyone middle-class and below, we’re screwed”: Housing costs are rising at their fastest pace in decades — but some Americans are already feeling the brunt

Brian Lowry

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