Some are facing prison time.
One of the biggest problems when renting is the problem of rental car thefts and evictions. The term “rent scam” was coined by former Chicago police officer Richard Miller and people have long been comparing the issue to a “rash pit” where thieves have taken money from people’s homes, including one homeowner. Here are some examples of the way in which Chicago rents have gone up in recent years: 2001-2011 : 14% increase in housing prices; 2008 : 8% increase in renters; 2009-2010 : 18% increase The question seems to be whether the recent surge in interest rate rises from the dot-com bubble is offsetting any impact from a decline in the real estate market. But it’s far from certain. But a study released last month by John A. Ostrander, a professor of economics at the University of Illinois and author of a widely cited book on Chicago’s housing crisis, pointed out that there has been no significant change in rents in either part of the city. Ostrander also pointed out that there was a significant decline in real-estate prices in the middle of the last century as home buyers became increasingly “waffling for cash” as a way to pay down the bills and avoid paying extra taxes. At that time, the rate of inflation was a few hundred percent below current rates. But the number of home-owner evictions has decreased sharply (in 2011, according to the city’s statistics), and the number of renters in higher-denomination houses have declined. In January and February 2011 the number was 23,000, with a further 12,000 evicted each month during the month. So it’s probably not unusual for the city to see an increase of about 24% or more between 2006 and 2010. The city’s rental vacancy rate did go down only slightly in April 2011, but it hasn’t been in constant rise since. Now that the vacancy rate has gone up a little since then and the problem of rental car thefts is out of control, the city’s problem appears to be in large measure to the right wing of Illinois politics. For those who want more on this, it’s worth reading the article about the housing crisis in Chicago below.
And here’s some real world evidence from the housing crisis that paints a different tale. More than two decades after the 1980s crash and the Great Recession of the late 1990s and early 2000s, Chicago’s housing market still looks pretty good.
So, we need to go back to the end of 2012 and see if it’s changing any in their way or the way they think. It’s definitely not.
Let’s be clear about how that changed the way Chicago saw the housing crisis for a number of reasons – not all of them favorable. It probably didn’t. The only thing that moved Chicago back in the right direction in 2012 was that the market had improved slightly. What would have happened had the Chicago economic slump been sharper? Instead we are seeing that the numbers just don’t add up. The decline in rents in some places was not just due to a decline in demand, but also due to a smaller number of people. In fact, the number of residents in those spots in the metro area actually grew slightly over the last eight years. But the number of people that were not able to live in Chicago when the city was going through a financial crisis increased dramatically. This was not an economic downturn or the recession that we see now. The people living there were more focused and invested in their communities.
Then there’s the way local law enforcement is using new technology to bust people who own high-end housing stock. At the same time, new laws are being drawn up in Chicago to target “high-end” illegal property owners. Now Chicago residents are getting hit with more fees, fines, and penalties than ever before – far higher than even high-end criminals. The new law also includes a new type of fine that allows low-income persons to pay an attorney, usually just for representing them in court, and that is often considered good-for-nothing. But the new law has also expanded in a host of ways. Just one new law will require an agent to be licensed to work in Chicago, and three more are giving special treatment or training to people who have already worked in the Chicago area. We can see that some of these are the types of enforcement that are most at risk of being abused. And in order to avoid being arrested or at least possibly punished for selling illegal housing, some of that will require an extensive court case. Most of the city’s neighborhoods now have long-term housing markets: the downtown is facing eviction notices that they are trying to sell houses that might be able to fit