Single-family homes are going to investors in batches, not to families who can use them.
Outside purchases are a crisis in the making
The May 8 article about houses on the North Side of Minneapolis being scooped up and turned into rental properties (“North Side buy-ups, from afar”) didn’t touch on one very likely reason for the purchases. HavenBrook Homes, like Blackstone Group’s Invitation Homes, is a private-equity firm. It is likely banking on bundling these houses into a financial product: rental-backed securities. Mortgage-backed securities (which weren’t really secure) were the cause of the last financial disaster. These kinds of private-equity firms and hedge funds are trying to attract investors by claiming these products are secure — that the houses will have a consistently high occupancy rate.
The desire to provide rental property for those unfortunate people who can’t manage to buy a home seems at odds with the actions of outbidding and gobbling up the very homes these folks might buy. Let’s hope these financial philanthropists are better regulated than the bunch that brought us the 2008 housing disaster.
Terry Faust, Minneapolis
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Homeownership is a key way working-class families build wealth — and when I say wealth, I’m not talking millions. It’s a way for a family to have a nest egg of maybe $75,000 or $100,000 to retire on or to pass on to their kids. Now these single-family homes will build wealth for corporations. This is a tragic change for the working class.
Yes, I own the duplex next door to my home, so people could say, “You own a rental — how is that different?” But these are single-family homes being bought up by the hundreds across the Twin Cities during a time when inventory levels are low and many of these are not foreclosures. Ownership will be based in a corporation, not by a neighbor vested in keeping up the property. My prediction is that eventually, once all of these are cash flowing on paper, there will be an IPO and then shareholders will own these homes, much as with the securitization of mortgages.
For all of the folks who want to write this off with “it’s not illegal” and “the free market exists for a reason,” think about what your life would be like today if the home your parents bought in the 1960s or ’70s couldn’t have been bought. Could they have bought their next house? Could they have helped you pay for college or have offered assistance with the down payment on your first home? Would they have anything to help pay for their long-term care expenses as seniors now?
Stephanie Gruver, Minneapolis
Support women faced with this tough choice
As a grandmother of four young girls and one little boy, I want to know that they will have every choice available to them when it comes to decisions about when and whether to have children. I’d like to know that, if they are ever faced with an unintended pregnancy or a life-threatening one, they won’t be abandoned by their government if they are poor and can’t afford to pay out of pocket.
The authors of the Opinion Exchange article “What’s being done in your name: Abortion” (May 7) seem to imply that all abortions are frivolous decisions and that, if you’re poor, the luxury of a “purely elective” abortion is something that taxpayers shouldn’t have to pay for. There are so many things wrong with this. The decision to end a pregnancy is very personal and full of difficult emotions. It’s a decision no one wants to be faced with and one that no one takes lightly. For a woman who is already struggling financially, that decision becomes all the more complex. We as a society, a community, should support her decision in every way we can — we should not punish her by taking away her options.
Penelope Mace, Minnetonka
The Opinion section is produced by the Editorial Department to foster discussion about key issues. The Editorial Board represents the institutional voice of the Star Tribune and operates independently of the newsroom.