naked capitalism

The boarding house faded from the American landscape over two generations ago. But mortgage payment stress is leading to a modern variant: more homeowners renting out part of their residence.

This New York Times story is anecdotal, but if trend grows, we may see attempts to quantify it, particularly since agencies frequently vet prospective tenants.

From the New York Times:

When Barbara Terry fell behind on her mortgage payments earlier this year, she did the previously unthinkable. Through a local housing organization, she and her daughter, Imani, 9, rented part of their single-family house to a stranger.

“I had to do something,” said Miss Terry, 46, who helps formerly homeless people move into new housing. “I said, I am not going to lose this house. Thinking about having a stranger was not a pleasant thought. I have a daughter. But the positive part was that I needed extra help, and I wanted to help someone.”….

Modest but growing numbers are turning to agencies nationwide like the St. Ambrose Housing Aid Center Homesharing Program in Baltimore, which screen boarders to find appropriate matches and relieve some of the fear of strangers.

“We’re seeing greater numbers of marginal people,” said Kirby Dunn, executive director of HomeShare Vermont, one of several hundred programs around the country that have been formed since the 1980’s to help elderly or disabled homeowners exchange spare rooms for income or, more often, help around the house, but now being pressed to meet different needs.

“Historically,” Ms. Dunn said, “the people who come to us have been looking for someone to provide services in the home. But now, money is the bigger issue for folks. There’s definitely an increase in people looking for a revenue stream.”

Ms. Dunn said volume at the agency was up this year, with three or four times as many people seeking rooms as seeking boarders….

Roy Miller, a housing counselor at nearby Belair-Edison Neighborhood Inc., said most of the distressed homeowners he saw were unwilling to rent part of their houses to strangers, especially if there were children at home. Most home-sharing agencies have fewer than 100 matches at any time.

But Miss Terry did not know where else to turn. She was behind on mortgage payments, but the idea of placing an advertisement in the newspaper or online scared her — anyone might show up at her door. (In the current movie “Kit Kittredge: An American Girl,” in which a Depression family takes in boarders to save its home, a motley assortment of strangers unsettle family life.) Miss Terry turned to St. Ambrose, she said, on the advice of her supervisor, who said the agency would screen potential housemates to find a match.

Like other home-sharing agencies, St. Ambrose conducts background checks on both parties….. A 10-point questionnaire sorts candidates’ feelings about pets, smoking, overnight guests and other points of compatibility…

In some communities, local zoning laws or homeowner associations may limit the number of nonrelated people who can live in a house. Ms. Brennan said that home-sharing could help some people caught in the housing downturn, but that its benefits were limited.

“Where we see it being of value is if someone is having short-term problems,” she said. “The average stay of a sharer is about a year, and some are much less… It’s a stopgap.”…

Agencies have different procedures for resolving conflicts, none of them perfect. Ultimately the onus is on the home-sharers. In Maryland, owners have to give renters 60 days’ notice to break their arrangement; renters must give 30 days’ notice.

At the Human Investment Project, also known as HIP Housing, in San Mateo County, Calif., Laura Fanucchi said her organization called both parties every three months, “to see if there’s any red flags.” But the organization cannot help with eviction, other than to refer the owner to appropriate government agencies….

Renée Drell, executive director of HomeSharing Inc., in Bridgewater, N.J., where home-shares rose 14 percent last year, said that as mortgage payments, heating costs and taxes have all risen, homeowners are asking for higher rents to share their homes, often more than seekers can afford.

But Ms. Dunn, of HomeShare Vermont, said people should not look at home-sharing only as a last resort or a financial Band-Aid. “When you look at the data on people living alone, they tend to die younger and be sicker. We’ve done surveys, and people say they’re happier, sleeping and eating better, and feel safer in their homes with someone around. If I sold you that as a drug, you’d pay thousands of dollars.”