The Other Side of the Boom | Features
First-time home buyers pushed out of the market
By Craig Manning | September 25, 2021
Zach Endres and Taylor Peterson find themselves in difficult situations. As you read the headlines about booming property sales in Traverse City and the housing shortage almost daily, Endres and Peterson live the reality in the middle of the apartment hunt. And to hear their stories from the past 12 to 18 months, hear about long waiting lists in local apartment complexes, homes selling well above asking price, and vacation rental competition for tight vacancies – all of which lead to a lot of frustration.
Zach Endres has been looking for a house in Traverse City for almost a year. He grew up in the area at the age of 27 and has long dreamed of settling here permanently. In a way, that plan is going well: Endres recently took up a new position at Cherryland Electric, is vice chairman of the East Bay Township Parks Commission, and has saved a tidy sum of money on the down payment for his first home. But since Endres started looking for a home around the same time the local market hit its spike in 2020, he has learned that finding a starter home that fits his price range could only be a pipe dream.
“There are very few properties in the Grand Traverse region that are even in mine [mortgage] Pre-approval, ”says Endres; he pre-approved a $ 175,000 loan. “And my agent didn’t even show me a house unless it was $ 140,000 or less because the houses were almost guaranteed to be sold for $ 30,000, $ 40,000, 50,000 above asking price. It’s hard for someone like me as a first-time buyer. I feel like I’ve done pretty well so far, but as a first-time buyer, I can’t afford to buy this $ 250,000 home. And because the market is so inflated, the opportunities just aren’t there [for lower-priced homes]. “
So far, Endres has made an offer for a “fixer upper” that was listed for $ 140,000. Endres offered the asking price; another buyer offered $ 175,000.
“I was pre-approved for this, so I could have raised this $ 175,000,” says Endres. “But that doesn’t leave me any extra money that I can put into the house to make it livable. And this house needed a new roof, new doors, and new flooring. It was all vinyl flooring and was peeling off. [That house] needed at least $ 20,000 and some love. And if you get the most out of what you can afford, you can’t afford to invest. “
Endres is ready to take on the “repair” part; he describes himself as “pretty handy” and says he enjoys doing this type of work. So far, however, even the fixer tops have ended up outside of its price range thanks to the dynamism of the bidding war market.
It doesn’t get any easier for locals looking for rental housing. Take Taylor Peterson, a local hairdresser in her twenties who rents a chair at O’Hair Hair Styling & Tanning in downtown Traverse City. Peterson has spent the past few months hopping from one housing situation to the next in search of something permanent, but comes up against hurdle after hurdle.
Peterson had lived in a house near the airport with several other tenants for nearly three years. When she found a new apartment, she informed her landlord that she was moving out and he promptly found a new tenant. But Peterson’s new living situation failed before she could even vacate her room. Left without a backup plan, she moved to an office a friend rented through a local business. That turned out to be another temporary measure: the landlady found out, cited a rule not to use commercial buildings for residential purposes, and gave her three days to vacate.
Since then, Peterson – along with a friend who recently separated from her fiancé – has been trying to find a stable, stable apartment in Traverse City. For most of a month the only accommodations they could find were in the form of expensive vacation rentals.
“We’re really trying very hard to find a place to live,” says Peterson. “We had to switch from Airbnb to Airbnb for three weeks. Now we live in another house, but it’s under construction so it’s not exactly ideal. And I’ve been on a waiting list at the Bay Hill Apartments for five or six months now. When I applied, they told me I only had to wait two months and here we are six months later. “
Another hurdle for potential renters like Peterson is that some local apartment complexes do not allow pets or have restrictions on the type or size of pets allowed. For animal lovers – Peterson has a German Shepherd – these restrictions can take an already short list of local housing options and narrow it down further.
“I’ve called every possible apartment complex in Traverse City,” she says. “And most importantly, even if you can find one, dogs are not allowed. And if they allow dogs, it’s only a 25 pound limit; I have a 100 pound German Shepherd. And he is a great dog: he is very good, he has a good education. But you can’t tell anyone that and make you believe it. “
For now, Peterson is just hoping that one of her waiting list spots will become vacant and she can claim a local apartment. Meanwhile, she pays $ 500 a month to live in a house under construction – a price that will go up to $ 750 when construction is completed in November. In addition to the car payments and the $ 640 she spends each month renting her downtown chair, she says, “it just adds up”. Even if she does get an apartment, she has to decide whether she can afford to take it.
“A one-bedroom bedroom in Traverse City costs $ 1,200 a month or more,” she says. “I don’t think anyone in this city can really afford that. I know a lot of people who can’t afford it. Then they move to Buckley or Kingsley, but that’s still a ride. And I work right downtown. I don’t want to be that far out of town. “
What’s next for these two young professionals? For Endres, the strategy is simple: save as much as you can in the hopes of getting a higher mortgage pre-approval. A higher loan maximum, he hopes, will put him in a more realistic price range for property in Traverse City.
For Peterson, however, the calculus of finding an apartment in Traverse City and affording himself to think about one thing local business development organizations like Traverse Connect don’t want young professionals to leave northern Michigan forever is pressing.
“I definitely thought about moving out of the state because it’s cheaper than Traverse,” says Peterson. “You can find a one or two bedroom apartment down in Florida that is a lot nicer than anything else in Traverse City, and a lot cheaper. I’ve been up here for nine years, I moved up from Illinois and would love to stay. But it’s just extremely expensive. And every time they say they’ll build affordable housing [here], they don’t. They think it’s affordable, but it really isn’t affordable. “
Editor’s Note: This story originally appeared on Traverse City Ticker, an online sister publication of Northern Express.