Montgomery County Faces Waves of Evictions (Silver Spring, Bethesda: 2015, apartments, leasing)

[adelphi_sky]

Holy Shiat!

Some 17,000 Maryland families are at risk of being evicted from their homes, and the Montgomery County Council is asking for funding to help keep that from happening.

https://wtop.com/montgomery-county/2...-of-evictions/

This is going to get worse. It's not just Montgomery County. It is all over the country. There are some ominous economic indicators that most people aren't aware of.

And this doesn't even include the resumption of student loan payments this year.

The damn is about to break. Look at the cracks:

WASHINGTON — A growing number of consumers are falling behind on their car payments, a trend financial analysts fear will continue, in a sign of the strain soaring car prices and prolonged inflation are having on household budgets.

https://www.nbcnews.com/politics/eco...nomy-rcna61916

On the heels of another rate hike this week by the Federal Reserve, credit card annual percentage rates are already near 20%, on average, and set to climb even higher. At the same time, more consumers are leaning on credit to afford increasingly expensive necessities, like food and rent.

https://www.cnbc.com/2023/02/03/us-c...-billion-.html

Facing an uncertain global economy and slowing revenue growth, technology companies have picked up the pace of layoffs in 2023, after sweeping job cuts rocked the industry last year. Here's an updated timeline of the more notable layoffs, and the reasons why Big Tech is in turmoil.

https://www.computerworld.com/articl...-timeline.html

[ion475]

While I do think housing is way too expensive, keep paying for other people's rent is not a feasible long term solution.

What US including MoCo need is lots and lots more housing and also better paying jobs. For MoCo though they talk one way about equity etc then go full NIMBY on developments unless it is some unaffordable "luxury" apartments or more fancy office towers that as of right now basically bring companies away from older suburbia business parks.

[adelphi_sky]

Originally Posted by ion475

While I do think housing is way too expensive, keep paying for other people's rent is not a feasible long term solution.

What US including MoCo need is lots and lots more housing and also better paying jobs. For MoCo though they talk one way about equity etc then go full NIMBY on developments unless it is some unaffordable "luxury" apartments or more fancy office towers that as of right now basically bring companies away from older suburbia business parks.

That's the other crack. The pandemic created a larger remote work class of workers. Thus rendering the need for office towers moot. There may be defaults starting on commercial office spaces.

Do companies force employees back to the office to justify leasing expenses? Or do they go 75% remote and save cashflow on leasing creating huge office vacancies?

Time will tell. Either way, the near economic future looks grim.

[bufflove]

A ton of people haven't been paying rent because eviction moratoriums and relief programs encouraged them not to. Returning to normal is YEARS overdue at this point. Time to pay the landlord or get out of their property.

[ion475]

Originally Posted by adelphi_sky

That's the other crack. The pandemic created a larger remote work class of workers. Thus rendering the need for office towers moot. There may be defaults starting on commercial office spaces.

Do companies force employees back to the office to justify leasing expenses? Or do they go 75% remote and save cashflow on leasing creating huge office vacancies?

Time will tell. Either way, the near economic future looks grim.

MoCo office vacancy is not THAT new, though...this from 2015:
https://moco360.media/2015/06/23/rep...nt-space-soon/

And it's kind of all over...
https://thedailyrecord.com/2022/06/1...-report-shows/

Now, TBH NoVA isn't that much better (actually it's worse) in that regard, even though the number stabilized.
https://www.nmrk.com/insights/market...market-reports
==============================
There are office-to-residential conversions but many of those also aren't really solving the "affordable" housing problem - those residential conversions are often pricy.

[Annandale_Man]

Originally Posted by bufflove

A ton of people haven't been paying rent because eviction moratoriums and relief programs encouraged them not to. Returning to normal is YEARS overdue at this point. Time to pay the landlord or get out of their property.

.... and sue for back rent.

[DCarea]

MoCo hasn’t done enough to attract businesses that would offer higher wages. Income is everything. With good paying jobs, rent subsidies would not be needed. High availability of high wage jobs resolves and prevents majority of society’s issues.

[ion475]

Originally Posted by DCarea

MoCo hasn’t done enough to attract businesses that would offer higher wages. Income is everything. With good paying jobs, rent subsidies would not be needed. High availability of high wage jobs resolves and prevents majority of society’s issues.

MoCo itself is doing ok (although can do much better) in terms of high-paying jobs especially in health science / biotech area. The latter is actually a sector where office / lab spaces is actually needed and is a sector where WFH is not really realistic.

Where MoCo truly get affected is the fact that as part of "equity" they want things to "averaged out" with those lower income residents, who faces a high COL without any subsidy. Those are the people that are truly getting affected anyway. You think somebody living in Potomac or even Bethesda will get evicted? No, you're likely talking about somebody living in Wheaton or part of Silver Spring etc. etc.

[bufflove]

Originally Posted by DCarea

MoCo hasn’t done enough to attract businesses that would offer higher wages. Income is everything. With good paying jobs, rent subsidies would not be needed. High availability of high wage jobs resolves and prevents majority of society’s issues.

The amount of wealth and high-wage positions in MoCo (and the DC region, generally) is mind-boggling and clearly not the issue. Even the minimum wage - which is going up to $16.70 this year - is relatively high and downright comfortable for dual-income households.

The backlog in possible evictions is entirely artificial, caused by government intervention that has been unnecessary since at least Q4 of 2021. Anyone who still isn't paying their bills in March of 2023 with a 2-point-something unemployment rate is either making a calculated choice or has been living beyond their means for years. Either way, sending more tax dollars to landlords fixes nothing.