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Squatting in the leftovers of the housing bubble

The New York Times reports that homeless people are beginning to squat in abandoned homes in greater numbers, and that in some cases, advocacy groups are helping them do so:

In Minnesota, a group called the Poor People’s Economic Human Rights Campaign recently moved families into 13 empty homes; in Philadelphia, the Kensington Welfare Rights Union maintains seven “human rights houses” shared by 13 families. Cheri Honkala, who is the national organizer for the Minnesota group and was homeless herself once, likened the group’s work to “a modern-day underground railroad,” and said squatters could last up to a year in a house before eviction. Other groups, including Women in Transition in Louisville, Ky., are looking for properties to occupy, especially as they become frustrated with the lack of affordable housing and the oversupply of empty homes.

But these non-paying tenants aren’t necessarily a net loss to the house they live in:

Mr. Rameau said his group differed from ad hoc squatters by operating openly, screening potential residents for mental illness and drug addiction, and requiring that they earn “sweat equity” by cleaning or doing repairs around the house and that they keep up with the utility bills. “We change the locks,” he said. “We pull up with a truck and move in through the front door. The families get a key to the front door.”

This might be a great opportunity for non-profits to help homeless families work well with owners of unsellable, unrentable homes. If you own a property, you’d ideally rent it to somebody for cash, but if you can’t do that, leaving it empty might not be the best option. A house that sits empty for months makes an easy target for thieves and “scrappers”, who strip away parts of the house for raw materials. Getting the right family in there, even if they’re not paying any rent, could conceivably be better for maintaining house prices than leaving it empty.

But how to find the right family, and how to make sure that they don’t do something really damaging to the house? You’re not inclined to spend a lot of money to screen a family that you can’t make a dime off of, and might just leave the house vacant because it’d be less work.

This could be where advocacy organizations come in, by effectively serving as brokers between the homeless and homeowners. They could get homeowners to give homeless families permission to live there, as long as the advocacy organization screens the families for obvious problems and checks in on the property once in a while. And, like any broker in a market, the non-profits would have an incentive to make homeowners happy, so they could keep working with them for other homes.

None of this obviates the broader fact that we should be spending less money on Wall Street bailouts, and more on unemployment insurance, food stamps, homeless shelters, and halfway houses. But in the absence of those policy shifts, it might be possible for non-profits to turn this housing crisis into a lot of temporary relief for the people they serve.

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Tagged: economics

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