2008, a year that will forever remain infamous as the period during which millions of Americans lost their jobs, their homes, and their lives. In 2008, the United States economy crashed in a devastating manner, primarily because of what is known as the US Subprime Mortgage Crisis. Housing prices were inflated well above where they should have been, as the Financial Crisis Inquiry Commission claims, primarily because of subprime lending, mortgage underwriting, predatory lending, mortgage fraud, and negative equity. As a result, the market crashed and housing prices plummeted, creating a dangerous climate for those that had no part in it in the first place: The Millennials.
In 2016, data scientist Mark Uh wrote an article for Trulia asserting that from 2008 to 2014, the percentage of renters increased by 5 percent, with home ownership falling by the same amount. This seems like a small number until you stop to think that the new percentage of renters now falls around 42 percent, nearly half of all Americans. Uh goes on to point out an even more horrifying fact: “average rents in the top 50 markets have risen 22.3 percent, while incomes nationally fell 5.8 percent in the nine years since 2006.”
With such a high demand, is it any wonder that apartment complexes can get away with ripping off some of America’s most vulnerable, the poor and young?
To better understand the issue, I spoke with one of our community’s top authorities on the issue of housing. It was a pleasant, warm Saturday evening when I sat down with Watson Realty, Nocatee’s top performing realtor, Judy Lassiter, who has over 12 years of exemplary experience.
When I asked her why she wanted to become a real estate agent, Lassiter said,
“I liked the fact that, for the sake of my 4 younger children, I could make my own hours. I love homes. I love looking at homes. I love showing homes. And helping people find a place to call home that they truly loved was an exciting thought to me.”
And it shows. Her passion for homes, and positively impacting the lives of others is one of many reasons why communities across Jacksonville respect her so much. Emboldened by the positive energy that exuberated from Lassiter’s every word and emotion, I pressed on.
When asked what she would say is the primary difference between owning a home, and renting an apartment? Lassiters’ answer was both wise and stunningly simple,
“If you own a home, you’re building equity in the home, and it’s yours. But with an apartment, you’re basically throwing money down the drain. You’re not getting any equity, but you are paying a mortgage, just somebody else’s mortgage.”
It sounded like a pretty good deal to me, but I was curious about prices. I wanted to know if rent per month was cheaper per square foot than a mortgage. Lassiter’s answer was firm, “In Jacksonville, Florida, it is definitely cheaper to own a home, than to rent a home.” So, if it’s both cheaper to buy a home than to rent, and better for the consumer, why are so many people renting? Lassiter explained that, due to the market crash, banks placed much stricter requirements on qualifying for home ownership.
A recent article from CNBC by Shawn Carter sums up the issue perfectly, “it’s not because they’re lazy or unmotivated or self-indulgent, [but that] houses and even apartments are too expensive for most young people.” In a world where anybody can instantly spend money to buy something, and credit is so aggressively pushed to consumers, it’s very easy to rack up debt and ruin one’s credit. Apartment complexes, auto lenders, and payday lenders take advantage of the poorest and the young by charging way too much simply because they can. This can have lasting consequences for those looking to buy a home for the first time.
I asked Lassiter about her personal experiences with young first-time home buyers. Lassiter told the story of an old-school young American couple; the stay-at-home mother of two kids, with another on the way, diligently looking after the next generation while the father brings home the bread. They’re ready to settle into their first home, the American dream. However, due in part to the inflated nature of rent and the still-healing market, they didn’t have enough to meet the required down payment. Many realtors would have stopped there, but not Lassiter. Lassiter was determined to help them find a home to raise their family in, and after some research, found out about the Florida Hardest-Hit Fund, a program that gives $15,000 to the first-time home buyer who can use it towards down payment and closing costs. Not only that, but also the money doesn’t have to be paid back as long as the family stays there for five years. She stood by their side and was able to see the happy couple move into their new home only a few weeks later.
Despite the myriad of obstacles in the way, Lassiter was adamant that, in her experience, buying a home is within the grasp of the youngest generation as long as they prepare early. I asked Lassiter for her bucket list of tips on how to prepare for a fiscally sound future at an early age. “Start saving money early… avoid frivolous spending … put together a budget … work hard … [and] do not get into credit card debt. Use one or two cards just to build up a credit history,” is what she said.
There’s no doubt that the explosion of apartments and rise of rent past the average rise of income is a problem, but there is light at the end of the tunnel. The world may be filled with predators who aim to suck every dime possible out of anybody they can; but wonderful, passionate people like Lassiter, who help others in small and simple ways every day, exist too. The good in us always wins over the bad. Responsibility may be an important factor, but Lassiter proved to me the value of kindness, and just how much going above and beyond one’s job can have far-reaching impact. A chain of kindness links the world together.
by Matthew Dal Porto