I’m on Twitter quite a bit. I love to rage tweet, share my thoughts about Meghan and Harry (The Duke and Duchess of Sussex) when I need something light to think and support and random comedic takes about Colorado and American life in general. And obviously, I spend a lot of time sharing financial takes. So when I came across a tweet that asked the following question “Why are we normalizing $2,000 a month rent-It stuck with me. I haven’t rented for quite a long time. I own a small and quirky property that I bought super conservatively due to lingering financial trauma from past difficult times. I think about the cost of housing a lot. We hear about how expensive it is to buy, how short-term rentals have negatively impacted housing inventory and driven neighbors nuts and how certain cities have become out of reach for the regular everyday folks who help them run it on a daily basis.
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At the same time we see the constant poverty porn about the growth of unhoused populations in towns across the nation. It’s wild to me that we all seem to be confused about what is pushing people out of stable housing. I’m in the process of preparing my little property to hopefully be rented out by fall of 2023. I would love to travel the world and explore-something that I haven’t prioritized even before COVID because I was paying off a shit ton of debt. What may surprise you is that I’ve decided to rent out my property ethically. No, I’m not saying that how you’re renting your property is unethical. I’m saying that I’ve decided to rent out my property with social equity in mind. I would like to rent it ideally to a single POC woman who would enjoy living in Denver but would be unable to afford the current average monthly rent for the city. Basically, I’m looking to rent out my place below market rates.
Welcome to Michelle is Money Hungry, I’m your host Michelle Jackson and I focus on holding financial conversations that lean into social equity, policy and access with a splash of pop culture. My goal is to lead these conversations with empathy and help both my listeners and myself learn more about money along the way. I’m gearing up for my next season of content focused on the unexpected financial turning point in American women’s lives. I’m still looking for brand partners to bring this project to life, if you’re interested in partnering with me feel free to reach out via my email: michelleismoneyhungry@gmail.com or you can DM if you follow me on Twitter. If you would like to be a guest, pay attention to my social feeds for more information.
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I’ll never forget deciding to move when my mom and I were living together all of those years ago. She had lost her job and I was supporting the both of us on Student Loans and my part-time Starbucks earnings. Even though the apartment we were living in was lovely, it wasn’t ideal for our situation. So, I started looking for a new place to live. Luckily, I found a 2 bedroom apartment for around $900 a month. It was a little bit of a stretch but it was 8 blocks from the apartment we were in. Also, the landlady was low-key a bitch. When I met the owner of the small apartment building I felt an immediate connection with him. He reminded me of Boulder, the town I grew up in. He was a hippy who was working on the building the day we met up. Looking back I’m convinced that he owned the building outright. I don’t think he owed a mortgage on it anymore.
I filled out the application and I think it was a $25 dollar fee one of the two times I think I’ve ever paid an application fee for a rental. Then there was a question about my credit score. It was in the sh$tter. Seriously, I had so much debt and I was just trying to survive the stress that was my financial life at that moment. So, I told him the truth.
“Ralph, I have terrible credit-but, I’m a great tenant.” He looked at me and said the following: “Don’t worry about it. I’ve run credit checks and have had terrible renters with great credit.” He took a chance on me and he was a huge blessing to my mom and I. Because of the stability of that home, I was in the position to buy the home that I currently own.
He took a risk on me but more importantly he provided affordable housing at a time when I truly needed it and the cost of housing in my town rapidly increasing. According to Census.gov the Median American annual earnings for 2020 was $41,535 dollars.
By the way, he wasn’t the only landlord to provide affordable, clean and well-maintained housing. I’ve watched the developments around affordable rentals, van-life, short-term rentals and people living trailers on the edges of many of our towns. I have some thoughts.
What is going on with the price of housing? I’ll never forget when COVID hit and almost overnight extended family members of my White neighbors were living in RVs in front of their homes. It was noticeable for the neighborhood that I live in. But, I’d seen people living in RVs in random spots around town, including the Ruby Hill neighborhood which is notable for the Levitt Pavilion concert venue that has free and inexpensive concerts here in Denver.
$2,000 Dollar Rent
How is $2,000 a month rent affordable to people making $41,000 k a year. I actually played around wth a rent calculator that helps people figure out what they can afford in monthly rent with the salary that they earn while calculating the debt that they’re paying on. If someone owes $500 in debt repayments think-credit cards, student loans or car loans then the rent they can afford according to this calculator is $730 a month. That’s $1300 less than the $2,000 dollar average rent that we have in Denver.
I don’t necessarily begrudge people for charging what they want to charge for their rentals. But, I do want to ask some questions:
- Just because we can do a thing, does it mean that we should?
- Is it time for local cities and towns to start legislating the following:
- Minimum Affordable housing builds
- Short-term rentals
- Programs to help provide funds for lower income citizens who are an important part of a town’s social fabric?
In fact, sometimes I even wonder about people buying properties in other states. I’m not saying that you shouldn’t. But, I do wonder what would happen if we prioritized homeownership programs and affordable housing for people originally from those towns that we are finding opportunities in? I guess what I’m wondering is-maybe there are folks who would love to be homeowners but can’t because of people like us who have more resources who’ve swooped in and bought those homes? Or, maybe there are people who would love to live in the mountains or cute towns but can’t because of basic financial gatekeeping ranging from rents, location and industries in those towns.
Ultimately, there’s a point when we have to ask ourselves why we’re acting like all of this is normal? It’s not and I think that sooner, rather than later, we’re going to find that out. There’s ongoing chatter that a Recession is coming. In an earlier podcast episode-What’s With All of the Recession Hysteria in the Personal Finance space I talk about the fact that I’m also in prep mode because Recessions always happen. Have we lost sight of this? That what goes up eventually goes down? What will you do when your tenants begin losing their jobs and are unable to pay your $2,000 a month rent?
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