The United Nations' housing advisor has accused one of the world's largest corporate residential landlords, Blackstone Group, along with other private equity firms, of"wreaking havoc" in their tenants' communities and"helping to fuel a global housing crisis," according to The Guardian.
Farha and Deva sent letters to Blackstone and to government officials in the United States and five other countries describing these practices. In these letters, the U.N. officials accuse Blackstone Group and its subsidiaries of attempting to push low- and middle-income tenants out of their homes by decreasing the number of affordable houses in certain areas and undertaking"aggressive evictions" to protect rental income streams.
In its reply to the U.N., Blackstone said that private equity had in fact helped build the rental market at a time when countries around the world were facing housing struggles. In recent years, Blackstone Group has acquired hundreds of thousands of homes in the U.S., Asia, Latin America and Europe. The U.S. letter focuses on the way landlords bought homes left empty after their owners defaulted on mortgage payments during the 2008 financial crisis, the Guardian said. The landlords were encouraged by U.S. government agencies to acquire these properties to bring homes back into use as local economies began to recover. The need to augment profits to repay investors, however, led to an escalation of housing costs for tenants. In some cases, rents were raised by 30-50 percent.