Rental Shortage (Minneapolis: real estate, apartment, renter)

[Beenhere4ever]

I don't think the Twin Cities will build itself out of the shortage of affordable rentals. But single homeowners might be one source. Due to the housing bubble, lots of people are living in houses with mortgages that are a layoff notice away from being a heavy, even crushing, burden. But if any of those owners could find an acceptable person to rent a room to, a renter would be better off and the mortgage burden would be eased. I mention this remembering being a teenager looking for housing. My first rental was no more than a bedroom. Very nice bedroom as I remember, but minimal space at minimal cost. It kept me from homelessness when I was working at minimum wage. From then to now, I'm quite sure people have rented houses as a group, another way to housing below market. Living alone is a value that really only makes the real estate industry rich. I've always wondered if the ordinances that limit the number of unrelated people in a rental are put there to favor real estate interests. I know some of the arguments for it, based on the idea of wild party houses. But for working renters, I doubt they are reality-based.

[xandrex]

It's hard to build new, affordable units. They're about as expensive as any market-rate place, and they require a subsidy.

One way to lessen demand on more affordable units, however, is to build more market-rate units. Those who can afford it will make the leap to the better units and allow those who need it to get into cheaper places. This can also help bend the cost-curve down. I'll be in my third year of having no rent increase. My landlord hasn't said it, but I do think that part of the reason is the boom is housing units near my area. If my landlord bumps rent up, my unit will approach the price of more attractive units. Once it gets too close, the small price difference means that it would make more sense to jump up to the nicer unit.

Of course to keep housing affordable in this way, you have to have enough building to meet demand, but I think this mixed with targeted affordable-housing builds is as effective of a technique as anything else.

[Beenhere4ever]

As I said to my sister, one way to have affordable rentals is for people who own to share their houses and get help with sky high mortgages. And for people who RENT to seek roommates. I'm inclined to say to anyone who thinks their rent is oppressive and hasn't even tried a roommate, you brought it on yourself. Learn to live with other people. Should be an improvement over living with your family.

By the way, what's to prevent an owner of a rental to raise the rent as high as possible when someone's lease ends and they move? There's no law against it.

[xandrex]

Originally Posted by Beenhere4ever

As I said to my sister, one way to have affordable rentals is for people who own to share their houses and get help with sky high mortgages. And for people who RENT to seek roommates. I'm inclined to say to anyone who thinks their rent is oppressive and hasn't even tried a roommate, you brought it on yourself. Learn to live with other people. Should be an improvement over living with your family.

By the way, what's to prevent an owner of a rental to raise the rent as high as possible when someone's lease ends and they move? There's no law against it.

I don't think anyone is arguing everyone should live alone. Although having a roommate isn't for everyone. I love to live alone, but I currently have a roommate. I enjoy my own space. But until I have a solid enough income, I will have my roommate.

It's already legal for rents to be jacked up at the end of a lease, even if you aren't moving out. But market-based rents are typically reflective of the market's ability to bear such prices. If my rent shot up $500, I'd move out and nobody else would move in, because they could move into a much nicer apartment for cheaper than the cost of my current one. The only time we see giant jumps after someone moves out is when you have rent control. Minneapolis has no such thing, so this isn't typical.

[ashnavygirl]

It's interesting that you posted about this, because this is the exact situation my family faced moving to Minnesota two weeks ago. After being in the Navy for six years, my family is used to a much different way of living than we knew to expect moving to Minnesota, and trying to find a place to rent here was nearly devastating. By some miracle, we sent an email on a duplex that was going to be available for rent- the people were buying a house, and were also considering allowing someone to rent their HUGE basement for quite a reasonable amount every month. Let me tell you, that was our saving grace! Things are going great, and we are so thankful, as we have faced some major issues (paying outrageous insurance premiums, for example) that would have severely set us back or caused us to go into further debt, etc. had we rented elsewhere. That being said, it's definitely a non-traditional method of renting, and really has to work between the two parties. We rent on a month to month basis and have a great understanding of the expectations of both parties, and really try to remain open-minded in our efforts to co-exist. We all get along great and our circumstances flow well together, so we just got super lucky! With that being said, renting in the twin cities and their outlying suburbs is far from affordable! On another note, living with new homeowners has really opened our eyes to the experiences, costs, and overall situations that homeowners face, and has really made me re-think my position on home ownership. It's an awful lot of work (and cost) to maintain everything, and say it's ours (since missed mortgage or tax payments can remind anyone how much they truly own). Of course, there are downsides to every situation, so it really is up to each person!

[ManBearPig1]

Originally Posted by Beenhere4ever

By the way, what's to prevent an owner of a rental to raise the rent as high as possible when someone's lease ends and they move? There's no law against it.

The same thing that prevents a grocery store from charging $100 per gallon for milk.

[dravogadro]

Single homeowners have provided rentals for years in Seward/Longfellow/Powderhorn. It's a great way to be in some great neighborhoods.

[BillWallace]

Originally Posted by Beenhere4ever

I've always wondered if the ordinances that limit the number of unrelated people in a rental are put there to favor real estate interests. I know some of the arguments for it, based on the idea of wild party houses. But for working renters, I doubt they are reality-based.

These ordinances are actually bad for real estate investors. The laws are intended to discourage investors from maximizing potential returns which in turn makes them much less desirable. It's roots are noticeable especially in areas around the U of MN like in the Como Ave area.

They are solely meant to protect owner occupied homeowners from having renters live nearby.