How To Solve America’s Homeless Population ProblemBy JD Esajian on May 1, 2015
There are millions of homeless people and children in America. Millions of more families are just two paychecks from being homeless. So what is the solution? How have some real estate investors been helping?
Ironically there are millions more vacant housing units in America than there are homeless kids and individuals. This doesn’t even count many urban buildings which could be redeveloped, vacant land, or the vast number of empty Airbnb rooms and hotel rooms that go empty each night.
April 2015 data shows that even in hot real estate markets that have been climbing in value by the double digits that as much as 30% of homes and condos sit empty. Over 50% may be vacant out of season.
One of the biggest pools of vacant homes is foreclosure homes. In 2015 Charlotte Magazine reported that 1 in 4 homes sold was vacant and abandoned. Other major cities have tens of thousands of these properties. And experienced nonprofit leaders say that using existing housing stock is far more efficient for solving homeless and affordable housing crises than building new.
RealtyTrac statistics show that pre-foreclosures, foreclosure auctions, and bank owned property have all been rising in many counties in the US during the first half of 2015. Yet, there are hundreds of thousands if not millions of these homes which are empty and not even being advertised. The courts can be blamed. Accounting rules can be blamed. But some may pose that this is the biggest bank and mortgage fraud scam we have seen yet. The resulting housing inventory ‘shortage’ is driving up home values fast. Homeowners love it. But homelessness and a lack of affordable housing is expensive for everyone. And so are the resulting symptoms. Even if you pay law enforcement overtime to round them up and corral them in a reservation, or lock them up in jail.
What would happen if banks and lenders were forced to put these homes on the market immediately? Or to return them to their old owners? What if the loans were seized through eminent domain and converted into affordable housing by local authorities?
In all of these cases, we’d still probably still have a building boom! And a lot of construction jobs with higher wages would be created.
In reality, we aren’t going to see a $40 minimum wage anytime soon. We aren’t going to see wealthy cities turn back the clock and change their priorities and laws. We won’t see all vacant homes opened up to those that need them. And it’s unlikely banks can be forced to do much of anything today.
Solving these issues isn’t easy. And there are many working parts, but we can each have a part in making things better. It’s up to individuals that will share this information on Twitter, Facebook, and Google+, and that will take real action.
Real estate investors are key to this. Some are helping by taking this inventory from banks and wholesaling it to others with the resources to rehab and redevelop it. Others are renting properties at affordable rates. Others are making properties safe and inviting and are selling them. They can be sold with seller financing, on lease options, with no money down, or in tandem with down payment assistance grants.
Those that are already doing this can help train others to invest in real estate. This can be the best gift of a lifetime. It is the difference between giving a man a fish to feed him for a day, versus teaching him to fish so he can feed his family for a lifetime.