A Bloomington real estate agent is helping lead a fight against rent control in Illinois.
State lawmakers have proposed setting caps on what landlords can charge. Ed Neaves, the managing broker of Berkshire Hathaway HomeServices Snyder Real Estate in Bloomington, was recently named president of Illinois Realtors, a trade association that has nearly 50,000 members.
He said on WGLT's Sound Ideas forcing rents down will cause investors to abandon rental properties. He said many will be turned into condominiums, sold to slumlords or demolished.
“The people that you try to help the most, the tenants, are out on the street, they are gone, or they are living in types of properties that have not been maintained,” Neaves said.
Three other states have passed rent control bills.
The Realtors group is cautioning the Trump administration against making significant changes to privatize mortgage finance giants Fannie Mae and Freddie Mac.
Neaves said the government takeover of the two firms after the 2008 housing collapse was never meant to be permanent, but too much private involvement in real estate financing will drive up interest rates and could possibly mean the end of the 30-year mortgage.
“We agree it needs to be reformed, but let’s take it lightly and softly right now,” he said. “While they have been in receivership, they are actually making money. So, it’s not a financial thing.”
The Trump administration's plans would allow the two firms to keep more of their earnings, but much of the details are still being ironed out and could take years to implement.
Housing Bubble Burst
While home sales rose nationally in August, reversing what’s been a downward trend, the real estate market has continued to languish in Bloomington-Normal. Sales are down 9% for the year. New construction — the higher dollar sales — are off 63% from last year.
Neaves blames that on rising construction costs and lagging consumer confidence.
“When people talk about some of our major employers having employment changes, consumer confidence kind of shakes out a little bit and says let’s just wait, let’s hold off before we out our house on the market,” Neaves said.
He said a major consequence of that uncertainty is fewer homeowners are upgrading.
Neaves added the so-called housing bubble that insulated Bloomington-Normal from many of the ups and downs in the state and national economies has become a thing of the past. He said the stability of Bloomington-Normal’s economic drivers — insurance, education and health care — aren’t able to overcome shaky consumer confidence.
“We’ve had a great, great run in Bloomington. We’ve been very fortunate in real estate and people finding homes and yes we had this bubble,” Neaves said. “I think now it’s just more like a regular market. So people are going, ‘Wow what happened? Well, it’s a regular market.”
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