High housing costs are driving some to seek untraditional living arrangements
Gary Grewal has moved a lot in recent years. First there was Denver. Then Chattanooga, Tennessee. Then Dallas. Then Austin, Texas. Grewal's job as a financial planner gives him the flexibility to work from anywhere, but his longstanding desire to buy a home keeps him from settling anywhere.
"Right now property prices are just too high and I refuse to overpay or rush into action for fear of missing out," said the 33-year-old. "I don't want to give up the things I'm looking for either, and living in the middle of nowhere on a small lot off the highway doesn't happen."
He prefers to stay with family and friends and often uses Furnished Finder, a website that offers furnished rentals for 30 days or more to working professionals.
"I'm officially a nomad," he said.
Grewal is part of a growing club looking for alternative forms of housing in the face of crazy conditions in the housing market - both for sale and for rent.
A 'For Sale' sign sits outside an apartment building in the Queen Anne neighborhood of Seattle, Washington, U.S., May 14, 2021. REUTERS/Karen Ducey
"These agreements go beyond the conventional and lean towards the less conventional," said Omer Reiner, who has bought and sold real estate in Florida since 2011. "I know a lot of divorced couples who live together under one roof because it's almost impossible to find that second home."
Unusual arrangements are popping up across the country, said Rick Sharga, executive vice president of RealtyTrac, a real estate information company, "particularly in some of the country's hottest markets, where competition is fierce and inventory is far too low to meet demand."
Take Palm Beach, Florida, for example.
“Homes that were $6 million last year are now almost $9 million,” said Ted Ward, a lifelong South Florida resident who works as a realtor partner at William Raveis. "Apartments that were $1,800 a month a year ago are now about $5,000 a month."
Ward, 65, who helps clients find temporary solutions, moved in with his 92-year-old mother two years ago. It was an easy decision.
"I didn't really want to renew my lease, buying was out of the question, and she needed me there," he said.
LOS ANGELES, CALIFORNIA - MARCH 15: A For Rent sign is posted in front of a home available for rent on March 15, 2022 in Los Angeles, California. Single-family home rental prices are skyrocketing, rising a record 12.6 percent year-on-year in January, according to new data from CoreLogic. (Photo by Mario Tama/Getty Images)
Ward, who says he'll eventually start looking for a house in the Jupiter region, plans to wait things out until the housing pandemonium wears off. The problem is, this can take a while.
Home prices are still rising much faster than forecasters initially predicted. According to Fannie Mae, they are expected to rise another 11.2% this year. Zillow expects a 17.3% increase.
Rents, which have risen almost every month since 2021, are likely to continue on that upward trend this year, said Jeff Andrews, senior market analyst at Zumper, a national rental ad platform.
“The underlying economic conditions that drove rents up so much over the past year are still in place. This year is developing very similarly to 2021 and could end up being worse," he said. "The madness is not temporary. It's the new reality.”
Personal finance journalist Vera Gibbons is a former contributor to SmartMoney magazine and a former correspondent for Kiplinger's Personal Finance. Vera, who was an on-air financial analyst for MSNBC for over a decade, currently serves as the co-host of the weekly non-political news podcast she founded, NoPo. She lives in Palm Beach, Florida.
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