Aspen Day-Flynn and her boyfriend, Travis Tolin, were thinking of moving back to her native Washington state this fall when their Phoenix landlord helped give them the push.
The monthly rent on their two-bedroom house jumped from $1,000 to $1,500 because the owner planned to renovate.
“It really pushed us out the door faster,” said Day-Flynn, a 23-year-old hairstylist.
She and Tolin, a 25-year-old tattoo artist, found an apartment that’s similar in size to their 986-square-foot (110-square-yard) Phoenix house for $1,600 in Ballard, outside downtown Seattle. While it’s among the priciest U.S. areas to live, the couple is earning more money there.
Phoenix long has been considered an inexpensive place to live, but that may be changing. Even some middle-class people are struggling to make ends meet as the desert city experiences some of the nation’s fastest-rising rents, jumping as much as 7% over the past year.
The metro areas of Miami; Knoxville, Tennessee; and Raleigh-Durham and Charlotte, North Carolina, as well as Washington, D.C.; Denver and Colorado Springs, Colorado, are among others with rapidly soaring rents.
Now the fifth-largest city in the U.S., Phoenix has become a victim of its own success as Californians seek cheaper housing and snowbirds fleeing winter weather buy homes or rent apartments that sit empty during the scorching summers.
Advocates say more initiatives are needed to create affordable housing, like a nonprofit financial institution that provides loans to build apartments for working families along the city’s light rail.
Better funding of the state’s housing trust fund also would help, said Joan Serviss of the nonprofit Arizona Housing Coalition. The fund that once provided $40 million to help with housing issues was capped at $2.5 million after the recession. She said that although state lawmakers this year approved a one-time injection of $15 million, it’s far from enough.
While it’s more expensive to live in Seattle, San Francisco and other cities known for a housing crisis and homelessness, Phoenix rents are outpacing salaries.
A worker in Arizona’s capital must earn nearly $20 an hour to afford an average two-bedroom apartment, according to the National Low Income Housing Coalition. The nonprofit says the average Arizona renter now earns about $17 an hour. The state’s minimum wage is $11.
“We are one of the least affordable places in the United States” for housing, said Mark Stapp, executive director of Arizona State University’s master’s degree program in real estate development. “It’s not only a social issue, it’s an economic issue. Employees need places where they can afford to live.”
Tenants have few options, with Arizona law largely favoring landlords. Rent control, like the 7% cap in annual increases that Oregon lawmakers approved this year, seems unlikely in a state largely controlled by Republicans.
A new luxury apartment complex with a pool and gym facing Phoenix’s light rail asks about $1,600 a month for a one-bedroom apartment and $2,330 for three bedrooms. Older single-family homes for rent nearby include an 890-square-foot (99-square-yard) historic house with two bedrooms priced at $2,300.
A $600 studio can still be found to the west or the south, but in older buildings without amenities.
Metro Phoenix has hovered near the top of several commercial real estate databases for fastest-growing rents over the previous year.
Yardi Matrix ranked metro Phoenix No. 4 nationally, with a 6.1% increase in apartment rents over a year. REIS by Moody’s Analytics put it at No. 2, saying monthly average rents in the Phoenix market surged 7% from the third quarter of 2018 to the third quarter of 2019. Only metro Miami saw a larger jump, at 7.5%, while the nationwide increase was just over 4%.
Home prices also are rising.
September figures from S&P CoreLogic Case-Shiller Indices showed metro Phoenix leading the way — at 5.8% — in the highest year-over-year gains for home prices among 20 markets nationwide, followed by the Las Vegas area with 4.7% and Charlotte, North Carolina, with 4.6%.
Evictions are also up, with courts issuing nearly 44,000 eviction judgments last year, slightly more than 2017, an Arizona Republic study found.
Carisa McAuliffe, her boyfriend and her two sons were evicted in September from a two-bedroom Phoenix apartment less than a month after withholding their $1,400 rent to protest problems like bed bugs.
McAuliffe, 37, said in her native California, tenants sometimes don’t pay to persuade landlords to fix problems. She didn’t know Arizona landlords can quickly evict tenants who withhold rent for any reason.
McAuliffe left her computer security job to sort things out. She and her boyfriend, who buys and sells cars, are staying with friends while the boys, ages 2 and 5, live with their grandmother.
Phoenix, like many other places, faces a shortage of affordable housing going back a decade to the Great Recession. Overall, the city’s housing supply is at about 4.7% — the national average, according to REIS.
Thomas Egan, president and CEO of the Phoenix housing nonprofit FSL, said the state needs about 165,000 affordable units costing renters less than 30 percent of their income. Just 2,000 units were built this year, he said.
Nationally, housing inventory has been tight since the recession, said Andrew Aurand of the Low Income Housing Coalition. He said there are fewer units available in coastal cities and metro areas with fast-rising rents like Phoenix, where people can spend more than a third or even half their earnings on housing.
Phoenix nonprofit development organizations like Chicanos Por la Causa pick up some slack, managing about 2,300 affordable and market rate units.
Native American Connections just opened a 64-unit development downtown where income, unit size and number of occupants are used to calculate rents ranging from a $440 studio for a lower-earning person to a $940 three-bedroom apartment for a family earning slightly more, CEO Diana Yazzie Devine said.
“It’s no secret that Phoenix is facing an affordable housing crisis,” U.S. Rep. Ruben Gallego posted on Facebook.
The Arizona Democrat said the new building ensures that individuals and families who work and attend school downtown can afford to live there, too.
Scott VanSoest, who manages a complex for the Foundation for Senior Living, which helps provide affordable housing for older people, said Phoenix used to be affordable “but now rents are out of control.”
Linda Stanley pays $236 of her $820 monthly disability check to live there.
“If I didn’t qualify to live here by being disabled, I’d be homeless now,” she said.