By Betsy Calvert, The Daily Sun Staff Writer, December 28, 2021.
The sizzling real estate of Southwest Florida is being felt by service employees and lower income elders dealing with the heat of higher rents.
Some landlords have decided to get out of the rental business and sell properties while prices are at record levels.
With Sarasota County listed by Niche.com as the No. 1 county in the country to retire, and Charlotte County at No. 5 county, there’s a lot of buyers.
Housing is already an issue in the region and now a limited rental market is losing units.
Then, some remaining landlords decide to charge more for rent. If rental units are scarce, the price goes up, whether or not current tenants can pay.
That’s what happening now in the region, according to area experts.
Two landlords told The Gulf Coast Partnership they want to raise rents, because they can.
“They think they can get it, because everybody else is getting it,” Gulf Coast Partnership Director of Landlord Engagement Denise Dull said.
Meanwhile, she said, income isn’t increasing for her clients.
“One of our clients reported that she was paying $1,500 and her rent is increasing to $2,500 in January,” said Barbara Cruz, president of United Way South Sarasota County. “She has a full time job and is doing all the right things to support herself and her daughter. She has been actively looking for a new affordable place to live, but is struggling to come up with the first, last and security deposit.”
The problem may affect the poor or average renter to begin with, but eventually, it can bring down the whole community, Cruz said.
“Our community is facing an affordable housing crisis which will have a domino effect,” she said. “If our workforce cannot afford live here, they will leave. If local businesses cannot find employees, their businesses will fail.”
A rent that was $1,200 is now $2,000 or higher, said David Haynes, president of Tarpon Real Estate in Placida.
His staff of real estate agents are now scouring the area trying to find an apartment for one staff member — a renter.
“We’re having to expand our search area,” Haynes said.
To force an employee to move too far, they could decide to work closer to their home, he said. In this time of both labor and real estate shortages, he wants to keep his employees.
Most employees are not so lucky.
Across the region, landlords are ending leases so that they can raise the rent and bring in new tenants, said Carrie Walsh, Human Services director for Charlotte County.
As a result, many households are out looking for new units, said Libbie Scherer, property manager of Five Star Realty of Charlotte County.
Demand for housing in Charlotte County is coming from all over the country, Scherer said.
This year, her company has had 184 rental applicants from 27 states. Florida was the biggest source for Five Star Realty with 94 rent seekers.
The Florida applicants are often the people whose rental house was sold, or their rent rose dramatically, Scherer said.
The next largest numbers Scherer is seeing are from states with high costs of living, including California, Massachusetts, New York and New Jersey.
So when they end the lease to raise the rent or sell, do property owners upgrade the rental unit at least?
No, Scherer said.
“There is a huge increase in rents for seasonal and annual rentals,” Scherer said. “But not many need to upgrade during such a tight market, and we are not able to find enough remodelers or laborers in this market to do any major remodeling in the short time frames they want.”
One of the ways that philanthropy and government helps is by providing some of the cost of rental down payments, which run as high as $7,000 for a basic unit, Cruz said.
But once in their new apartment, families are finding they have little left over to handle the rest of their lives.
Federal aid for the pandemic has been a double-edged sword, Walsh said.
Outside of the pandemic, people often cannot use rental assistance because the rents available to them exceed their income. But during the pandemic, the rent caps were lifted to prevent a wave of homelessness, Walsh said.
“When that subsidy runs out, when we can no longer pay, we’ve put people in a situation where they cannot afford to say in that home,” Walsh told the Charlotte County commissioners at a recent workshop on affordable housing. “We are dealing with an unsustainable situation.”
Even people in private subsidized apartments are struggling as the cost of living increases, Dull said.
One elderly woman has only $30 left over after she pays her subsidized rent, Dull said. She has a dog, so she sometimes only manages to feed the dog, not herself.
Subsidized housing run by private companies do not lower rent to accommodate lower income as do government-run housing complexes. So a person dealing with poverty can be priced out of subsidized housing.
Dull is advising lower income households to get on wait lists for subsidized housing, even though 100 families might be ahead of them on the list. She also tries to put single people together in housing.
“You do what you have to do,” she said.
Subsidized housing cannot fill the gap. There is not enough, and working people with relatively low incomes generally earn too much to be eligible.
Charlotte County Commissioner Stephen R. Deutsch said the county should appeal to U.S. Housing and Urban Development for a new housing authority, which might open up new funding.
Walsh said HUD does not want more housing authorities, to which Deutsch advised to be the squeaky wheel.
“Anything we can do, we’re willing to do it,” Walsh said.
What’s needed is large apartment complexes, both Dull and Cruz said. It is needed in both Charlotte and Sarasota counties.
Those projects often objections from residents, such as a project on Charlotte County’s Harborview Road. Neighbors fought against it earlier this year, saying they wanted home owners, not renters. Hoping for some apartments, commissioners urged the developer to reduce the size as a compromise. The developer backed out of the deal.
“Private citizens, business owners and community leaders can advocate our Sarasota County commissioners to prioritize affordable housing to use a significant amount of the $84.2 million in funding from the American Rescue Plan of 2021, a COVID-relief bill Congress passed last March, to help build more afforable housing in our community,” Cruz said.
The problem also can’t be solved with individual home rentals, Dull said, or low income home ownership.
That means that low income home ownership through Habitat for Humanity is not a full solution.
Even if they build 30 affordable homes a year, she said of Charlotte County’s chapter, it’s not enough.
Dull works with area landlords and tries to keep a list of possible rentals for clients that come to the seven-county agency for help. She also tries to cajole landlords into renting to clients.
“I work as diligently as I can, making calls and schmoozing landlords as I can,” she said.
Haynes is working with builders and investors, treading the fine line between inviting them to build, but for workforce housing. In particular, he believes everyone — builders, investors and renters — will benefit from more duplexes and triplexes.
Charlotte County’s affordable housing plan calls this the “missing middle” ground of affordable housing in a county that is short on large, undivided parcels of land for large apartment buildings.
But they may try to build for the highest bidders.
“We have to try and find that balance,” Haynes said.
Haynes believes wages are going up as well in the region. When the Sunseeker resort opens in a year in Charlotte, staffing it will require a new level of creativity in worker housing, he said.
Perhaps employment offers will include housing, he said.
“It’s going to take out-of-the-box thinking,” Dull said. “There’s great leadership in (Charlotte) County and really smart people that are doing great things. The affordable housing today is not the projects of old … It’s really cool stuff. It’s community living that’s quite amazing, and might really be awesome.”