South Denver residents get creative on paying for housing

Sites like Airbnb can help people pay for their mortgage

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Janet Bardwell’s home in University Park has been in the family all her life. It is her childhood home and where she grew up. When her mother became sick in 2010, Bardwell moved back into the home to help care for her.

After her mother died, Bardwell wasn’t sure she could keep the house. For one, it was a large house. But she also wasn’t sure she could afford it.

“I couldn’t find a place that was in a neighborhood that I wanted to be in,” she said. “I had to figure out, ‘How do we cover this mortgage?’ .”

Over the past several years, Denver has continued to grow — from almost 600,000 in 2010 to an estimated 716,000 this year, according to U.S. Census Bureau records. Developers have tried to keep up with housing demand. But costs of apartments and houses had already started to climb. The new apartment stock coming into Denver is largely for luxury renters, which makes it difficult for those with lower and middle incomes to live in the city.

Housing by the numbers

Britta Fisher, chief housing officer with the Office of Economic Development in Denver, has been in her role for just over a year. Mayor Michael B. Hancock hired her after he began to change the function of the Office of Economic Development to focus on affordable housing. So far, Fisher said the city has started on 1,603 affordable units in the city this year, with another 458 breaking ground within the next year.

“Our construction pipeline is robust,” Fisher said. “We’ll be adding to that throughout the year.”

While Fisher said they are trying to spread those affordable units throughout Denver, city staff are also trying to pay attention to where vulnerable populations are living and where the most need exists. Unfortunately, those areas aren’t hard to find, she said. “It’s not hard to find need for affordable housing in Denver.”

The average rent for a one-bedroom apartment in Denver is $1,072 according to Apartment List. That’s up from $917 in May 2014. House prices are not much better. In May, the average house in the metro area sold for more than $555,000, according to the Denver Metro Association of Realtors. In May 2013, the average price a house sold for just over $308,000.

Now, people like Bardwell and Danielle Anderson, a mortgage broker and Airbnb host, are starting to turn to technology to help them pay the bills. Many young people assume they can’t afford a home in Denver, Anderson said. But if they are willing to rent a room in their house via Airbnb or a similar site, more possibilities open up.

“I’ve used those tools to be able to afford what I have,” Anderson said. “I am able to better help clients better think outside the box.”

In 2016, when she first started renting on Airbnb she took in nearly $7,600 in rentals. The next year she earned more than $14,600. In 2018, that number jumped to $16,400. Those rentals add up, Anderson said, noting that they almost pay her whole mortgage.

Keeping a home

For many in Denver, the issue is not only finding housing, but staying in it. And the city has been working on a number of ideas to help residents do that, Fisher said.

Various assistance programs exist, such as Rent and Utility Assistance, as well as the Temporary Mortgage Assistance program. The city also expanded the preservation ordinance on how long units must remain affordable to 60 years from 20 years.

For some of Denver’s most vulnerable populations — such as the homeless and low income families — staying in housing is crucial.

Cathy Alderman, vice president of communications and public policy with the Colorado Coalition for the Homeless, said the organization also works on programming to keep people in homes. The 2018 Point in Time survey, conducted by the Metro Denver Homelessness Initiative, counted more than 5,600 homeless people living in the Front Range.

She advocates for more housing options for the whole income spectrum because housing, she said, is often not a one-size-fits-all solution. Families and couples have different needs than a single person.

“In Denver,” she said, “people can’t really afford to live where they work.”

House hacking

When Bardwell was faced with the cost of a house mortgage, she began looking at ways she could make money while using the house. She recruited her sister to help find a solution and that’s when they came across Airbnb.

“I needed my home to generate more income,” Bardwell said. “I get to share this resource.”

Anderson calls this “house hacking.” Tools like Airbnb can help people pull in more income to pay their bills. In Denver, the city has specific laws and taxes on how short-term rentals are operated. People can only rent out their primary residence, and they must have a license through the city to rent a property. But it can be a valuable way for people to pay off a mortgage or keep their home.

Anderson, who is originally from Greeley, was living in Houston when she first started using Airbnb five years ago. She and her roommates started renting out one of the rooms in their house. When Anderson moved back to Denver three years ago, Airbnb factored in on multiple levels. She booked stays at houses in different neighborhoods throughout Denver to see which she liked best as a potential place to live. She also knew from the beginning that she would rent part of her home on Airbnb and had already factored it into her budget.

Having the rental income helps in “knowing I might be able to stretch my money a little bit farther if I wanted to,” Anderson said.

A similar route to Airbnb is renting out an accessory dwelling unit (ADU). Like Airbnb, Denver has specific rules and zoning codes for these units. An accessory dwelling unit can be a garage or shed that has been converted into a living space.

Anderson said she is looking into such a unit using the garage at her own home.

Although accessory dwelling units are not a full solution to housing, quicker buildouts mean they could help provide some desperately needed units. Accessory dwelling units could help aid in the housing crisis, Fisher said, but she also remains cautious about the trend as well.

“It’s not only about the supply but ensuring affordability in the supply,” she said.

A sense of control

Although Airbnb and other short-term rentals are just one way for people to build on their income, it is one that gives people more control. Anderson and Beverly Bravo are both more restrictive with their guests and don’t let them use the kitchen space. Hosts on Airbnb can decide whether or not they are marijuana or party friendly.

Homeowners can control just about everything about the rental on the Airbnb website. Owners can also block off times on the website, allowing people to rent only when they want guests.

With roommate rental situations, people are staying for longer periods of time. Typically, they also share the common spaces with owners. If you don’t like a person, you may be stuck in a rental contract with them. But with sites like Airbnb, those people are in and out of a house more quickly.

“If you don’t like the person, they’re not there long,” Bravo said.

Renting on Airbnb or similar websites is not for everyone. Bravo first tried Airbnb around three years ago, but decided it was too much work for too little money. The taxes put in place by the city were also challenging, she said. She recently started renting her room to a more long-term roommate instead.

All three women agreed that renting a home on Airbnb led to meeting interesting new people in the city. Many people have asked them if they were comfortable with having a stranger in their home. Bardwell was quick to point out it also could be strange for guests. “They’re walking into a stranger’s home, too,” she said.

As shared economies such as Uber and Airbnb become more prevalent, Anderson believes more people will start opting in to the technology available.

“It’s not new,” Anderson said, “but it can become the new normal.”

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