Austin had an unhoused population prior to the pandemic.
Yet like all other inequities, this has become more visible with a growing population of recently unemployed people under the threat of being evicted. Despite this dire situation, new condos, still under construction, loom in the backdrop of these unhoused campers.
There’s a severe disconnect between landlords and tenants. Somehow, the rise in people who could potentially be evicted, unless saved by government assistance or the grace of charity, has not deterred real estate investors from building new condos. This would only make sense if the people who were camping in front of the new condos were the future occupants.
Even though I’m a former math/science teacher, I cannot follow the logic behind building more housing that very few of us can afford at a time when more of us are under constant stress of being evicted. In other words, who are these people, besides other investors, that are going to buy or rent these new condos?
In my elementary understanding of real estate, lucrative cashflow can be made through monthly rent. Now if the current occupants lose their jobs and/or unemployment is insufficient to pay full rent, then there’s less cashflow. By evicting those tenants, the landlord must still pay taxes and utilities until another tenant moves in. How does that work during a pandemic?
Even with my own rent situation, the leasing office offered my roommate and I a deal: if we signed a 10-month lease instead of a 12-month lease, then we could pay the same amount as we’ve paid for the past 14 months. Why 10 months, you ask? Well, in the prepandemic version of our civilization, July and August were the most popular months to move.
Now, I can somewhat understand that logic. The leasing office is gambling that by July 2021, all this shit will be sorted out and people will have their regular income again. This gamble is not apparently taking into account that this pandemic has triggered a recession. So, instead of trying to incentivize current tenants to remain in place without any rent increase, they should DECREASE the rent.
Wait, did I just type that out loud?
Why yes, motherfuckers, I did! Because I’ve read that in places like Manhattan, those landlords have seen a mass exodus. They’re now scrambling to offer a few months rent-free to attract new tenants. To which I say: LOWER THE DAMN RENT.
What tenants are looking for at this point isn’t a shiny new condo, but inexpensive, hopefully safe, accommodations. Those new condos can come with all the bells and whistles as far as amenities are concerned, but without the most attractive feature, affordable rent, then what’s the point? There cannot possibly be positive cashflow if the rent is calculated based on 2019.
