Arizona is one of the hardest-hit states in the nation when it comes to the real estate market crash. We see it in every neighborhood we drive. Unkept yards with towering weeds resembling rain forests, vandalized properties with broken garages, doors and windows and broken into homes have become the norm.
The worst part about it is that there seems to be no end in sight. Federal agencies, loan behemoths such as Fannie Mae and Freddie Mac, and U.S. banks own approximately 500,000 homes to date. Experts suggest there are approximately another 2 million loans currently in default.
It’s clear that the federal government is unprepared to handle the crisis and is ill-equipped to sell this inventory. However, the government’s latest idea has “catastrophe” written all over it. The federal government is now toying with the idea of getting into the landlord business. That’s right, President Obama may become your landlord.
Government officials are considering the idea of pulling their inventory off the market and making these properties rentals. First, if they lack the ability to sell these homes, what makes them believe that they can rent them out? They can’t even figure out how to pass a balanced budget.
I have extensive experience in the Arizona real estate market. I own and have owned dozens of doors around the Valley and know firsthand the difficulties that accompany being a landlord, including rehabbing properties, renting them out, dealing with HOAs, upkeep, collecting rents, and evictions, to name a few. Do we really believe that the federal government can tackle these tasks?
Again, if the government can’t successfully sell their inventory, how are they going to successfully market and rent out millions of homes? Instead of thousands of vacant homes with “for sale” signs peppering our Phoenix streets, we will have those same homes with “for rent” signs decorating our neighborhoods, inviting would-be thieves to steal air conditioners and appliances.
Then, how long will it take the federal government to process applications for would-be tenants? What will people, who are in-between homes, do for the several months it’s going to take for the government to even acknowledge them as a future tenant?
Not all, but many renters are looking for rental properties because they have a track record of not paying their mortgages and/or may have recently been evicted for not paying their rent. What happens when a renter moves in with their deposit and first month’s rent but fails to make an additional rental payment? Millions of renters will have the opportunity to freeload off the government, which our government never seems to have a problem with anyway.
How is the federal government going to process those pesky HOA notices when tenants fail to pull the weeds out of yards or leave their garbage cans out? The fines and assessments are going to rack up, potentially putting the federal government on the hook for millions of dollars in HOA fines.
Worst of all, what happens when the air conditioner goes out due to Arizona’s extreme hot conditions? How long will it take the federal government to come out and fix or replace those air conditioners? I could go on and on.
This is a bad idea. The federal government should figure out how to effectively run our country — how about figuring out the debt ceiling woes? — not stick its nose in places it doesn’t belong.
• Michael Weinstein is co-host of the “The Mike & Winey Show” which can be heard Saturday from 8-10 a.m. on KFYI (550 AM). He can be reached at firstname.lastname@example.org