The Round-Up Volume 17: There are two sides to every story
Everybody's been impacted by COVID-19, but not all in the same way.
October 8, 2020
There are two sides to every story.
Depending on how you look at it, millions of Americans are unemployed or the U.S. labor market is rapidly recovering from the depths of this Spring’s collapse. Either people are struggling to stay in their homes or the housing market is going gangbusters. The economy is not working for low-income workers or the rich are getting richer thanks to a run-up in the stock market.
The fact is, all these things can be true. And they are.
In a world more fractured than ever, let’s make an effort to see things from another angle 🔭. We are people, neighbors, and Americans above all else.
Welcome to the Round-Up.
A Housing Boom?
We begin with one of COVID-19’s most unexpected developments: the nation’s housing boom.
In this newsletter, we’ve shared a number of articles, podcasts, and quotes highlighting the renters and homeowners who are teetering on the edge of eviction and foreclosure. But that’s only part of the story.
Anyone who’s house hunting knows there’s another side to the story. And it’s unbelievable. Offers are coming in well above asking price and homes are getting snatched up—often sight unseen—as buyers try to outmaneuver competing bidders.
Several factors are at work.
First, there’s a historically limited supply of homes for sale. Even before the crisis, homebuilders couldn’t construct homes fast enough to meet demand. And although sales of newly built homes reached an annualized pace of 1 million for the first time since 2006, it’s still not enough.
Historically low borrowing rates—and the Federal Reserve’s pledge to keep interest rates low through at least 2023—are bringing more buyers into the market.
Demographics are playing a part too. Compared to past generations, Millennials delayed marriage, having kids, and homeownership, but as some reach their late 30s they now appear to be settling down.
Finally, the flexibility to work remotely has some knowledge workers moving from expensive tech hubs like New York and San Francisco to more affordable cities (Columbus, Austin, Nashville) which are, ironically, in danger of becoming less affordable.
Some believe the residential real estate boom has room to run and could turn into a full-blown affordability crisis (home prices were up 4.8% nationally in July). Wall Street appears to be as bullish as ever, with institutional money pouring into suburban rentals like it did in the years following the 2008 housing crisis.
The financial benefits of homeownership shouldn’t go to Wall Street. The democratization of ownership would’ve been a saving grace during the Great Recession, but the world wasn’t equipped to make it happen. Now we’ve changed that. Every renter should be an owner. Every American should have a shot at participating in the value that’s created in our cities over the next decade.
That’s why we chose now to bring Rentership into the world 🚀
The Other Side: Evictions
Evictions continue to be the ugly flip side to this otherwise hot housing market.
Check out CNN’s interviews with Columbus residents who are struggling to stay in their homes despite the CDC’s nationwide moratorium on evictions. Not everyone who’s eligible for relief knows it, and even some who go before a judge are being turned away.
Without access to information, there cannot be equitable access to opportunity. A person should not be evicted when they have other resources at their disposal, so there’s a clear need to bring more resources for renters to the fore.
In the meantime, Marketplace.org has more on the issue.
In Other News
September’s weaker-than-expected jobs report is said to be massively concerning. The labor market will certainly shape housing and personal finance going forward.
It’s anyone’s best guess whether Democrats and Republicans will agree to a second round of stimulus before the election, and President Trump is sending mixed signals about his support for getting something done. House Democrats this week introduced a revised bill that would provide another round of $1,200 checks to individuals.
The sputtering economy is particularly troublesome for working mothers and Black Americans. If opportunities and resources (e.g., housing, jobs) aren’t fairly allocated, our country’s income and wealth gap will continue to widen.
President Trump returned to the White House after a three-night stay at Walter Reed National Military Medical Center. COVID-19 is shaping up to be the centerpiece of the election, and we hope our nation’s leaders don’t continue to ignore the personal economic pain it’s causing. (Friendly reminder to get out and vote! 🗳️)
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Everybody’s been impacted by COVID-19, but not all in the same way.
The story of America’s economic recovery, the housing market, education, access to healthcare… it couldn’t be more fractured.
We believe empathy is a superpower for navigating this. We need to be able to put ourselves in another’s shoes and really try to understand what they’re going through.
Even if we’re not experiencing the same things, a shared understanding of two very different sides can bring us together 🌎.
And that gives us hope.
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