Share and share alike
Struggling homeowners in Baltimore can raise extra cash by letting a room through a local housing organisation. Lydia Stockdale investigates how the model could help under-occupying tenants in the UK
St Ambrose Housing Aid Center, based in an attractive town house on a quiet residential road seems a world away from the Baltimore of guns and gangs portrayed in hit television series, The Wire. It’s actually only around two miles away from the location used as the home of the Barksdale Crew, but far from being here to investigate drug meets and police corruption, Inside Housing is on a mission to find out more about something altogether more community-minded: the home sharing programme St Ambrose has been running for nearly 30 years.
Historically the programme has mainly served as an assisted living scheme through which older homeowners, who want somebody to help around the house, are matched with sharers willing to do it in return for reduced rent.
Recently though, it has appealed to whole different set of clients. Homeowners who and are finding it difficult to keep on top of their mortgage payments and are potentially facing foreclosure - which means the bank will repossess the home, sell it and keep all the proceeds - are increasingly seeking out St Ambrose’s programme in order to gain an additional source of income.
‘The vast majority of homeowners who approach us are at least looking to alleviate some financial strain through home sharing,’ explains programme director Rebecca Sheppard.
‘This includes people who absolutely need the money to continue in the home. A lot of times people will call us when they are approaching foreclosure, when they’ve experienced a lay-off and they do it as a preventative strategy.’
St Ambrose’s scheme had a spike in demand between 2009 and 2011 when the number of homeowners and would-be sharers approaching the not-for-profit organisation rose by 150 per cent, with more than a thousand individuals expressing an interest, she adds.
The home sharing programme costs St Ambrose - a non-profit organisation which offers homeownership and foreclosure prevention counselling, and also develops housing for rent and sale - $200,000 (£124,965) a year to run, and operates with one full-time member of staff and a part-time employee, along with volunteers and interns.
It currently has 150 homeowners either matched or waiting to be matched with a sharer. In total it oversees 220 such pairings each year, which includes replacing lodgers who have moved out.
The team’s workload is unlikely to dwindle anytime soon. Figures released by Realtytrac, which publishes a database of foreclosures, show a 29 per cent rise in the number of default notices being issued and foreclosure auctions scheduled on properties in Maryland - the state in which Baltimore is based - between August 2011 and August 2012, when there were 620 new filings.
Just as opening up their home to a stranger has been one way for people struggling financially in Baltimore to meet their housing costs, it has also been suggested as a potential option for UK social housing tenants who are deemed to be under-occupying.
Under the ‘bedroom tax’, which will be introduced in April 2013, working-age tenants with one spare room will have to pay an average of £14 extra per week to their landlords if they want to remain living in their current home. Tenants with two spare rooms will pay an average of £25 per week.
The Department for Work and Pensions has amended what it counts as income so that from October next year tenants will be able to keep cash they receive from letting their spare rooms while retaining their full benefit entitlement.
In Baltimore, home sharing is seen as a way of keeping people in their communities, as well as bringing in new people.
‘For us it’s a neighbourhood stabilisation issue - we’d rather them find a solution that allows them to have cash and to stay in their house, rather than watching that property go downhill,’ explains Gerard Joab, executive director of St Ambrose Housing Aid Center, speaking from the organisation’s meeting room in a converted drawing room of the property on East 25th Street.
There are financial advantages for the sharer too, he adds. ‘They can save on their housing costs to be able to afford, after a year, the down payment on a house or the security fees to get a rental apartment, or whatever it is they need to improve their housing lot.’
It is important to stress, however, the role the organisation has in overseeing all of this. Sharers pay between $10 (£6.20) and $40 (£25), set on a sliding scale dependent on income, to be part of the programme. Homeowners pay a $40 enrolment fee, along with a match fee, which is a third of the first month’s rent. In return they receive mediation and conflict resolution services.
St Ambrose, which does not make a profit from the home sharing programme, visits the homeowners’ property to get an idea of what the living arrangements will be. Then they interview the owner to find out more about their expectations.
‘We’ll ask, do you like cats, they’ll say, no I hate cats and I don’t want any smokers and I don’t like this or that,’ explains Karen Griffin, director of resource development at the organisation. ‘There’s a filter - we would never send somebody who has cats to somebody who hates cats.’
The team draws up the contract between the homeowner and sharer, and also helps set rents. Ms Sheppard and her colleagues do not dictate what the rent should be, but they point out if they think a homeowner’s expectations are too high.
‘Ultimately the decision is up to them, but we advise them on how much to charge based on what we know of similar spaces,’ she says.
An easy process
Millie Hrdina, 67, has found 10 short-term lodgers through the home sharing programme over the past nine years. ‘When you put an ad in the paper, you have to deal with a lot of people, whereas when you deal with St Ambrose, you put your preferences and tolerances down, and they don’t send you anyone who isn’t within those,’ she says. ‘Plus they do background checks to make sure people are able to pay their rent. I am also able to interview them over the phone, and then in person at my home.’
One of Ms Hrdina’s lodgers claimed she was in an alcohol recovery programme during this interview, but once she’d moved in she would roll in drunk every afternoon and on one occasion, became threatening, so Ms Hrdina called St Ambrose.’They got her out within 24 hours - they showed her the contract she had signed,’ she recalls.
‘If something does come up in the home, whether it’s to renegotiate the rent, or it’s something interpersonal, we do go and help mediate,’ says Ms Sheppard. ‘As you can imagine, when people start living together there’s adjustment, a new lifestyle, personality difference - we’re able to help facilitate the early months of the match when people are negotiating compatibility and learning each other’s habits and tendencies.’
Around 85 per cent of matches are successful with both homeowners and sharers getting what they want from the arrangement. This means clients like Ms Hrdina continue to be happy to share. ‘If it’s done in the right way it can be a good experience for people,’ she says.
Eileen and Ben’s home sharing experience
Eileen Lewis, 66, has been renting out the spare rooms in her large, detached home for the past 12 years. She’s better off now than she was when she first signed up to St Ambrose Housing Aid Center’s home sharing programme.
She had gone through divorce and moved into her mother’s home. When her mother died two years later, ‘funds were tight’, she says.
‘But I had these rooms in my house - I wanted an additional income and also to reach out to people who were having a bad times and to help them until they got back on their own two feet.’
Up until 2007 when she retired, Ms Lewis was a mental health counselor working in homelessness shelters - she now works part-time teaching swimming, and also teaches people who didn’t achieve their high school diploma at a local college.
She says she’s ‘never felt unsafe’ in her own home. ‘I feel St Ambrose has my back and they have the renter’s back too. They’re there to help with conflict if it should arise.’
‘They do background and credit checks on everybody to make sure they have a job and can afford the rent,’ she adds. ‘They check in with me at least every six months to ask how things are.’
Ms Lewis is currently letting her attic bedroom out to air traffic control student Ben Ware - at 22, he’s the youngest person she’s shared her home with.
She usually charges $525 (around £325) a month, including bills, but because Mr Ware only stays in her house in Catonsville, a town just outside Baltimore, three nights a week while he’s at college, Ms Lewis charges him a reduced amount.
Mr Ware, who began living here in January, and expects to stay for another year, says this is the first time he’s rented a room. He says sharing a house has been trouble-free. ‘I tend to keep to myself and I keep everything clean so there haven’t been any problems.’