Rentpocalypse NH

Art by Lalo Alcarez

In Oregon last month, Governor Kate Brown signed a statewide rent control law. Like many states, Oregon has a shortage of rental properties. This law caps annual rent increases to seven percent plus inflation, which amounts to a limit of about 10 percent this year. It also exempts new construction for 15 years, and landlords may raise rent if renters leave. This isn’t doing a whole lot to help anyone, which is why landlords didn’t fight it. They were more afraid that the state would remove the current ban on local rent control policies. It will do little to help those who are at the low end of the income scale, who will continue to spend upwards of half of their income on rent.

The budget calculation formula from the 60’s that is still in use today, warns that we should spend no more than 30 percent of our income on rent. Anyone who spends more than that is considered “cost burdened.” Anyone spending 50 percent or more is considered “severely cost burdened.” It is not the wealthy that are “severely cost burdened.” It is your barista, the clerk at the cash register, the server taking your order, the person stuffing you into a chairlift, the person who cares for your grandmother - the workers of the service economy that we all rely on. It might also be your grandmother. Elderly people are a fast growing segment of the homeless population. 

A 2018 report by the New Hampshire Housing Finance Authority found that NH has a rental property vacancy rate of 1.96 percent. A vacancy rate of 4-5 percent is considered a balanced market for supply and demand. The survey found that the median rent for a 2 bedroom apartment has increased 19 percent over the last five years. In Carroll County that increase was 11.7 percent. It was 31 percent in Coos. The last recorded vacancy rate for Carroll County was 1.4 percent in 2016. The sample rate has been too small for the study for the last two years. 

The 2018 report from the National Low Income Housing Coalition found that a minimum wage worker earning $7.25 an hour would have to work 96 hours a week to afford a one bedroom rental. The average wage of a NH renter is around $15 an hour. The wage needed to afford a two bedroom rental is $22.32. Right now, the average rent for a one bedroom in NH is around $900. It’s upwards of $1200 for a two bedroom.

In addition to having very high housing costs, NH also has very low unemployment. So far that low unemployment has done little to raise wages. Employers are only now starting to grasp that housing is a big part of their problem. Housing is one of the many problems that New Hampshire has been ignoring for decades. Adequate housing might mean people with kids and that means funding their education. We fund education through property taxes, and NH has the second highest property taxes in the nation.

When the economy collapsed in 2008, people lost their houses and moved into rentals. That caused prices to skyrocket. The collapse of the economy created the so-called “sharing economy” where desperate folks were trying to monetize their possessions by ride sharing or renting out rooms in their houses. Airbnb caught on, and quickly became a way for privateers to buy up housing and rent it for big bucks. Both events meant fewer rentals for working folks. A lot of the people whose finances were destroyed in 2008 never got back to where they were. The jobs created in the aftermath of the 2008 economic collapse were largely low wage service jobs. While rental costs have increased in NH by 19 percent over the last five years, for most workers, wages have not. Homelessness, however, has increased by 10 percent in the last 4 years. 

NH has a problem. We have an aging population. We have a housing shortage. We have a lot of low wage jobs. Raising the minimum wage would help, but it won’t solve the housing shortage. Even if we raised the minimum wage to $22 an hour, there still wouldn’t be enough housing. Some ideas: there should be no new commercial construction that doesn’t include housing. Building an outlet? Build up: stores and restaurants downstairs. Housing upstairs. That should be true of every single ugly new store built along the Rt. 16 strip. Locally, there are many empty buildings. Some of them have been empty for years. Turn them into housing.  (Also, build more housing.) A tourist economy needs workers. An aging population needs caregivers – and housing, unless you want Granny living in her car. Until then, there are many helpful YouTube videos on how to live in a car.

“A man’s car is his castle,” – said  no one, ever.   

Published as an op-ed in the March 8 edition of the Conway Daily Sun Newspaper