President Promotes Renting

At least $8B, and possibly more than $10B, in stimulus and federal budget funds will be used to (re-)invest in affordable renting housing in the U.S. The Boston Globe describes this as an "ideological shift" away from Bush's Wild West Ownership Society; Calculated Risk points out that the Obama Administration is harnessing an existing trend: the supply of rental housing has been increasing since 2004, mostly due to conversions of ownership properties.

There's two elements to this initiative that I like: $4B to upgrade existing public housing (a drop in the bucket, but a drop, nonetheless!) and the purchase of foreclosed homes to be converted into affordable rental units.

Commenter Lori raises an interesting point over at Suburban Guerilla in response to this announcement: why aren't we pursuing more radical, less costly innovations to seriously expand the stock of affordable housing - including homeownership - in the US?  Her actual statement reflects why Bush's unregulated, overzealous ownership dream went so awry: "If you want to have a nation of home owners, you have to build housing that people on the bottom can afford to buy."  And is it really a good idea to leave renters at the mercy of landlords?  She voices support for the re-use of shipping containers as low-cost (and roomy by my condo's standards) rent-to-own housing.

Concerning landlords, I think tenants' rights is a related but separate issue here.  One thing I would emphasize is that federally rental initiatives like this will partner mostly with local non-profits and municipalities to refurbish and improve rental housing, which to me is a necessary alternative to the current private market purchasers of foreclosures who are using them as investment properties (29% of the homebuying market).  From living in a neighborhood with an owner-occupancy rate of only 25%, moving the rental inventory from the hands of absentee landlords to community-based non-profits sounds like a great idea to me.

(Photo by TheTruthAbout...)