IT WOULD BE EASY to sell my home “in a snap” for a no-obligation, all-cash offer—or so I was told in a mailing I received last week. I frequently get letters, texts, emails and phone calls from companies that want to buy my two-bedroom condo for cash.
It’s tempting to sell. I’m retired, and both my children have left to find their fortunes in bigger cities. But I suspect the new owner would then rent out my unit for some jacked-up price. That’s happening across the country, as 60 Minutes and other news media have documented. The buyers, of course, are just being capitalists and taking advantage of a housing shortage in many cities. But where does that leave lower-income families, including retirees?
A wood frame two-bedroom, one-bath bungalow in an older neighborhood in my college town is renting for $1,500 a month. The landlord wants proof of income that’s three times the rent. That’s $54,000 a year, which is the median household income in our area. But what if you’re a single parent with a service job? Or a single retiree like me? That $54,000 is considerably more than my fixed income.
My son rents a two-bedroom, two-bath apartment in a relatively new building in Atlanta. His landlord wants to increase his $1,900 monthly rent by $400, a 21% hike. Management refused to negotiate with him, so he’s moving to a one-bedroom unit elsewhere and will still come out ahead, even after moving costs.
My daughter’s landlord in Orlando raised her rent 4.8% to $1,625 for her suburban ranch house. The landlord insisted on only a 12-month lease, even though my daughter and her husband would like to stay longer while they save to buy a home. The house is owned by an individual and managed by a company.
As long as my millennial children stay in big metro areas, I fear they’ll never become homeowners, despite their relatively high incomes. I live in a university town, and I see no reason for the skyrocketing rents here for homes that aren’t considered student housing. Those two-, three- and four-bedroom apartments next to campus are renting for $1,000 per room.
Some experts blame builders for their emphasis on large, single-family houses because that’s where builders make the most profit. Renting an apartment, duplex or smaller house used to be a segue to buying your first home. Now, it’s a permanent status—because renters can’t afford to save for a house down payment.
I don’t want my condo to become part of this “filtering,” where housing moves into a higher price tier and an anonymous company demands outrageous rents from people scraping by. In the past, houses and neighborhoods filtered down in price as they aged, according to this article. That’s no longer as true today.
The author cites stats from Los Angeles that show most of its affordable housing was lost to higher rents and not because the buildings were demolished, replaced or renovated. Elected local leaders’ usual answer is to build more affordable units, but those rents are rising faster than incomes.
I love that my condo has increased in value. It’s really my only asset. But if I choose to sell and move, I’ll want a buyer who lives here and not a company that will gouge others and fuel the increasingly unaffordable housing market. As a condo board member, I also believe owners who occupy their units take better care of them and show interest in the entire condo community.
Of course, I might just have to stay for financial reasons. Why? I’d likely pay more in rent than I do now for my fixed-rate mortgage plus condo fee.
Ron Wayne spent 26 years working for newspapers in Pennsylvania and Georgia before becoming the editor in the University of Florida’s main news office. During his 10 years working there, he earned his master’s degree in mass communication and taught as an adjunct in the College of Journalism and Communications. Since retiring in 2020, Ron’s resumed writing regularly, both for HumbleDollar and on Medium.com, where he’s launched a publication for single retirees who need to be extra thrifty. Check out Ron’s earlier articles.