This post was written for the June 2022 Carnival of Aros on “House and Home”
With housing prices rapidly rising across the country, I’ve gotten used to seeing dozens of thinkpieces and well-meaning articles about how home-ownership is the key to building wealth, and that continuing to rent is just draining your money away instead of building equity. While there is room to argue about whether this is always the case, that’s not what’s activating my pet peeves today. Instead, what gets my goat is the way that such articles so often position rental vs. owned housing as a matter of whether you can afford a downpayment, with little acknowledgement of some of the other factors that can affect housing choices.
In particular, rather than simple profit or cost, what keeps me in rentals is a combination of flexibility and risk – particularly the flexibility to live in larger communal settings instead of small nuclear or individual households, and without having to take on the long-term financial risks of having to hold a forced partition sale in civil court or spend hundreds of thousands to buy people out everytime someone wants to move out.
I’m also increasingly frustrated by how much these discussions revolve on the assumption of a nuclear family household model, with discussions of the relative merits of renting vs. buying all revolving on the assumption that these decisions are being made by either individuals or married partners. As an aromantic and non-partnering person who prefers semi-formal group living with platonic friends, this just doesn’t accurately reflect my reality.
I’ve spoken previously about my current living arrangement, and how much I enjoy group living with friends (currently 5 of us total). Within that arrangement, I effectively rent a full bedroom, and a share in a bathroom/kitchen/living area/balcony, for an incredibly affordable price, thanks in part to rent control, economies of scale, and being willing to take the smallest room (for reference, I pay under ~$1500 USD; a studio or 1 bedroom in my area is more like ~$2000-3000) . And since I prefer having lots of people around and like spending time in common areas, this works out great for me!
It’s also a style and cost of living that is basically impossible to replicate in a buyer’s market built for nuclear families, as “family”-size housing for this kind of social living isn’t generally sold in fractions.
I’ve done the math before, when looking at the cost to buy housing in my area instead of renting. If I look at the cost of say, a four bedroom in a more affordable neighborhood a few transit stops away from me, I could theoretically reasonably afford ¼ of the cost for it. Unfortunately, I can’t buy just a share of a house the way I can buy a single slice of pie, even if that’s all I’m hungry for.
Instead, the only things I could hope to qualify for a mortgage for would be something like a studio unit in a condo tower, which due to economies of scale and differences in target markets would likely cost 3x as much as my current living arrangement (and easily 2x as much as my theoretical ¼ of a house), and outstrip what I can reasonable pay for.
The next logical question would be, if you can afford ¼ of a house, why not find three other ¼ ers and go in together? The answer is that this entails significantly more long-term financial risk for all of us. Even if we could initially afford to all go in on a mortgage together (and find a bank will to approve this nontraditional arrangement), the risks if things go wrong are significantly higher, as each person could be find themselves held liable for up to the the entire mortgage debt if things go wrong, not just their theoretical quarter share – more than 4x the risk they’d be taking on if they made a smaller purchase individually. You might be able to mitigate some of that with careful lawyering, cohabitation contracts, and use of civil courts, but all of those come with their own additional risks, not to mention added financial and time costs (and lots of stress in the meantime).
As much as I sometimes complain about that one recent popular tumblr post and others like it that catastrophize the risks of buying property or cohabitating without the protections of marriage (which just isn’t an available option for everyone, especially if you number more than two!), there’s a reason that almost all financial advisors start of their introductions to how to co-own property as an unmarried couple with, “we generally suggest that you consider not doing this”. While the risk might be worth it for some (I’ve seriously looked into it myself), it does still involve taking on significantly more risk; and while you can mitigate some of it with a lot of money and paperwork, you can’t get rid of it all. And that’s just for regular couples – the risks get even more complex if you’re a group of friends or a complicated polycule or extended family that wants to split a house 3 or 4 or even 5 ways.
Instead, the general advice for cohabitating couples and friends who want to buy property is to have a single head of household purchase a more modest home in their own name and with their own funds, and then simply become the landlord themselves, bringing us practically back to where we started: you either rent from a landlord, or you yourself must become the landlord.
Of course, even this relies on assumptions of both wealth and nuclear families. A member of a well-off couple might be able to stretch their finances enough to cover the initial mortgage for a small condo with space for two. But if you are a group of friends looking to split a 4 bedroom house? Unless you are fortunate enough to have a very wealthy friend or a particularly affordable area, it’s unlikely any single person’s savings can stretch that far. And even if they could, it’s a huge amount of liability to ask anyone to take on.
Unless, perhaps, we could give someone a small financial incentive to take on that liability from the rest of us, so that we can all live together in a style we choose? Well, that’s exactly what for-profit landlords do (assume long-term risk in return for short-term financial profits), and we’re back where we started.
That’s not to say that this is the best solution to this situation, or that it should be – in a more ideal world, maybe people could just buy shares in a common living space. Maybe larger groups could access marital-like legal recognition and the ensuing protections to make shared ownership less risky. Maybe there would be more novel and accessible types of homes to consider buying. And there definitely could be ways for individuals to trade off profit and risk without the massive and growing power imbalance of current rental markets.
But in the short term, I’d like it if more discussions of the pros and cons of renting vs. buying could at least break away from assumptions of romantic-sexual nuclear families and acknowledge that other shapes of households or ways of living might require very different kinds of analysis.