Let's start with some math
Late-2019 (that seems like forever ago, doesn't it?) research from Apartment List showed 49.7% of the 41M renters in the U.S. were "rent-burdened," or "cost-burdened," which is typically defined as spending more than 30% of your income on rent. (Actually, one of the first posts I ever wrote for Whiterock was about how much, percentage-wise, you should spend on rent.)
The DFW area mostly mirrored national trends. About 482.049 households in DFW -- 47.2% -- were paying 30% or more of their income to housing. From 2017 to early 2019, we added about 27,000 rent-burdened households. Median rent from '17 to '19 went up about 3.2% but median income in DFW went up 1.1% in the same span, hence the addition of more rent-burdened households.
The good news for all the DFW hustlers who like urban areas is this: out of the 25 largest cities in the United States, Dallas and Fort Worth are two of just six where renters can comfortably afford median rent via median income. Average per unit in DFW was recently about $1,160.
But all this changes with a layoff or furlough
Most people lack a robust investment portfolio or affluent parents -- and even if you have the latter, you may feel bad about going there. A lot of people need their monthly income in the form of work. When that disappears, your economic picture can change quickly. And even if you got a reprieve from certain loans and bills, those reprieves will start coming due later this summer -- and while the May jobs report was good (yay!), we don't know about the pace of rehiring, really.
So, let's say your lease was up at your current place and you didn't really love living there. You want to move, but you've been furloughed or laid off. Can you move? Or would it be safer to figure out some type of arrangement with a place you already have a good track record of paying monthly to?
The cases for staying put
- It might be easier.
- Maybe you could talk to the complex manager and note that you have been paying consistently, and offer to help them with social media, emails, painting projects, or something else.
- Should you be scared of moving during a potential pandemic bounce-back? Maybe.
- You need to focus on income right now and not get distracted by moving.
The cases for finding a new place
- You deserve to live in a place you like.
- Movers are working these days.
- If you bring over some friends with some pizza/beer and organize everything, a moving process can be done in 3-4 hours, relative to size of apartment.
- Getting into a new spot might help your headspace around job search and what you want to do.
- Just because this moment is very big health-wise and protest-wise doesn't mean you need to be static in your own life. YOLO.
OK. You want to move. But how do you convince a new complex if you're laid-off or furloughed?
Well, this isn't the answer you necessarily want to hear right now, but it's going to vary by complex. The laid-off/furloughed situation is actually a good use case for working with us at Whiterock, because we can help a little bit to navigate the conversations with the complex.
In general, a complex wants to make sure it will get paid monthly. That's part of their revenue structure. So, if you are laid-off or furloughed, they are going to ask about:
- Other sources of income
- Previous payment history
- Potentially other bills
- Job search
We have worked with some complexes in the past two months who have been very understanding on these issues, and welcomed new residents (remember: economically, apartments need residents too) with a deferred plan or a co-sign. We've seen a few complexes who take a harder stance, and it would be more challenging (but not impossible) to get a place in those buildings if you're laid off.
In short: it varies. We can help navigate the discussion with a complex, for sure, but you also need a clear picture of your financials, your savings, whether someone can help you out for a few months, side hustle income, and more.
It's totally doable and you can move if laid-off or furloughed, but it takes a bit more organization and context on the front-end.