Sun, Jul

It’s All About the Almighty $$


ACCORDING TO LIZ - We will never fix the homeless crisis as long as the current system encourages people to gamble that the price of real estate will perennially increase.

Not so long ago, many thought that was a good thing: that people would plop their nest egg down to buy a house early in life and, by the time they were ready to retire, it would have mushroomed into a nest-egg sufficient to support a pleasant retirement.

First buying bigger houses as their family expanded, and then downsizing and pulling out capital to line their golden years lifestyle as their children flew the nest to buy homes of their own.

But then came reverse mortgages, using properties as piggy banks, lenders capitalizing on expectations selling to grossly unqualified buyers, investors banding together in REITs, slicing and dicing...

Then came a stagnant economy and a static minimum wage so kids couldn’t afford to move out, let alone a down payment on their own real estate piggybank.

There can never be such a thing as affordable housing if wealthy people and powerful corporations can profit by gambling on the rising price of real estate.

We need to step back and take the hard steps to enshrine safe, healthy, affordable decent housing as a human right.

Like healthcare for all, such a concept will attract powerful detractors, those who are already rich and want to continue profiting while more and more Americans suffer from the inability to afford even a shared apartment, the indignity of asking for handouts on the street and the physical and mental deterioration that accompanied living homeless.

Have the profiteers no decency?

How can slumlords get away with charging more and more for unsafe rat-infested apartments with total disregard for their tenants?

It’s a tough job but governments at all levels must prioritize policies to remove developers’ incentives to build, baby, build (but only market-rate properties so they can maximize return on their investment).

And to remove scum landlords’ incentives to suck every last sou out of the rental properties they own and buy, by not doing repairs or using scam contractors with cut-rate materials, by not adhering to health and safety codes, by flipping the property before the regulators can legally enforce court mandates.

It won’t be easy but why are government officials and employees paid the big bucks if not for taking the heat when the rights of human beings are being imperiled by the agents of greed.

Some interim solutions could include setting up boards of citizens to hear and adjudicate complaints in every Council District. Composed of renters and struggling homeowners along with a legal-aid trained lawyer to hear the cases of their neighbors i.e. people who are less likely to be bought off.

These boards should have the authority to:

  • stop evictions until an expedited hearing is held and obligations imposed on both tenant and landlord which can be enforced within 5 days of breaking any stipulation if not cured within an appropriate time period
  • immediately enforce repairs charged back to landlords through their taxes with the ability to garnish the bank accounts of the company and the individual owners or, if they try to flip the property first, subtract such costs and interest at the time of sale
  • impose such stiff penalties that it will be prohibitive to NOT make repairs or provide necessary services and needed improvements
  • stop City-promoted real estate scams based on false assumptions that serve to enrich developers (and the Councilmembers in their pockets) with rezoning schemes and building incentives that, instead of reducing homelessness, only increase market values and further escalates already over-the-top rents.

To fund these and other changes, the City should immediately impose fees on people owning but not living in those units including AirBnBs, REITs that purchase and hold onto empty properties to maximize the profits when they sell without the added complexity (and grief) of renters, and those who own for occasional use – the days passing through Los Angeles from their yacht on the Mediterranean to their penthouse in Singapore.

Ethics Commissioners need to be granted more leverage over elected officials so they play ball for the people and not just the developers and others who top up re-election kitties.

At the Federal and State level, laws must be passed to vest ethics supervisory entities with teeth powerful enough to strip all politicians from receiving money for any reason other than through blind sources, and provide that anyone who breaks secrecy – elected official, functionary or beneficiary – be subject to severe fines and banned from operating in their current capacities for a minimum of fifteen years.

And to, furthermore, ban all politicians from meeting in private with developers and real estate purveyors with the same provisions. For that matter, moving beyond the housing crisis, ALL lobbyists and special interest groups.

The only ones “special” to them should be their flesh-and-blood constituents.

Require politicians who are in personal relationships that might conflict with conflict-of-interest requirements to either take another position where their integrity could not be called into question or, at the very least, recuse themselves from all matters where their integrity might be called into question.

For example, Toni Atkins married to Jennifer LeSar, a real estate development consultant, should NEVER have been allowed to arbitrarily move the contentious SB50 to a vote out from under the Appropriations Committee which had put a hold on the bill for its evisceration of local real estate development oversight.

The curve of the wealth gap is widening because if people can’t afford to rent, how can afford to buy and benefit from real estate escalation?

Reversing this troublesome trend is a first step towards promoting more inclusionary practices by subverting overt and covert discrimination against minorities, the poor, and the less educated.

What is certain is that Los Angeles desperately needs to find outside-the-box solutions to increasing the number of affordable units; these could include finding more economical ways to fund construction and conversions.

One way would be to aggressively promote tenant-owned cooperatives which. as well as keeping resale prices low and affordable, also encourages pride of ownership and the opportunity to bond with ones’ neighbors.

We should double down on developing neighborhoods where services match the needs of the people to avoid food ghettoes and other abuses of poor minorities as well as attracting a mix of people from other areas without creating a gentrification effect.

The City needs to create the conditions to successfully import other social housing models. In Vienna, the government takes a holistic approach to work with private sector developers and experienced architects to ensure accessibility of quality housing that is affordable to anyone.

A corollary might be to overburden market-rate development with penalties on the profiteering spiral such projects sustain and pass regulations to focus on climate-conscious conversions and improvements, co-housing and other alternatives.

Los Angeles must also address alternate funding sources for landlords to do legitimate renovations and upgrades so that they wouldn’t be forced to jack up the rent to cover their own costs. Although this should be balanced out between the landlord’s savings of not having done needed work before; the difference between what would have been a simple re[air ten years ago and what is now a major structural overhaul, i.e. if there is any legitimate value added or the cost is simply the consequence of a parsimonious slumlord mentality.

Finally, whatever the tactics the City takes, the present practices of tying support to percentages – of income spent on housing, on “affordable” housing in any community, or on people’s present income are patently unfair, too easily gamed, and sets up multiple flashpoints for confrontations between those who benefit and those who don’t and the various tiers of government.

Change takes time and effort, and there are growing pains for all involved.

The ideal solution – increasing income across the board to ensure equal affordability for all – is, for now, an aspirational dream. While working towards it, Los Angeles and the United States needs to use the “Housing First” approach to get all people now on our the streets into safe and healthy housing.

And that starts with ensuring the costs of accommodation are affordable for all who require shelter, and every effort is made to decommodify the housing market and keep a roof over ones’ head as a right not a piggybank.

(Liz Amsden is a contributor to CityWatch and an activist from Northeast Los Angeles with opinions on much of what goes on in our lives. She has written extensively on the City's budget and services as well as her many other interests and passions. In her real life she works on budgets for film and television where fiction can rarely be as strange as the truth of living in today's world.)