The Rental Market, Capitalism-Style

We - my partner and I - are trying to get an apartment.  She currently lives in a two-bedroom, and with her roommate moving out to live with her partner, and me moving down there to live with my partner, it doesn't make economical sense to stay in an $1850 a month two bedroom with an exorbitant amount of space for young professionals.  Especially since I am, as of yet, still facing unemployment once my class ends.

So even though "moving" is probably a lot what hell is like (that, and maybe a never ending visit to the dentist or gynecologist), it is ideal from both an economical and a personal perspective.  My partner has lived with her Stuff for three years in one place, and I have lived with my Stuff for three years in another place, and combining our Stuff (probably more of hers than mine at this point) may necessitate a new stage in our relationship.  One where we are in neither her space nor my space, but a smaller, shared space that belongs to us both.

All that is easily said.  So, as we've recently discovered, is saying "let's move into a one-bedroom!"  How hard could it be to move from a two bedroom unit in one complex to a one bedroom in the same complex, you might wonder?  Surely it's like all other apartment searches we've ever made (between the two of us, we've done this probably four or five times...that's plenty of experience, one would suppose.)  We don't even really want to move anywhere - just to a smaller unit in the same place.

Oh, dear readers, how wrong we were.  Nothing could have ever prepared me for the pure batshit irrationality of the rental market in this greater-DC condominium.  There are many things that fuel this irrationality.  Part of it is because my partner lives in a lovely garden condo complex where each condo is owned by someone different. So there is no overarching condominium office where you can put your name on a list or coordinate multiple showings.  Instead, every negotiation is with a new owner, which means there is no regulation or bench line for pricing.  One 630 square foot unit can be priced at $1450, while another 530 square foot unit with comparable specs can be priced at $1550.  I'm pretty sure they just price it based on their mortgages.  Or malicious whim.  It's hard to say at this point.

Dealing with multiple owners also means there is no standard for each apartment.  Some of them have hardwood, some have carpet.  Some have had their bathrooms redone, some are still in original form.  Some original features have been worn pretty hard, some have been better taken care of.  Some have new cabinets and granite counter tops in the kitchen, some still have the original oven and dishwasher.  Some have new windows, others don't.  Some renovations are professionally executed, others are a little homemade.  With every unit being so variable, you really don't know what you are getting until you see it.

But the point, we've found, is not to see it, not even to care whether it's worth the money or whether the features are ideal or whether we really want to hold out for hardwood or an eat-in kitchen or whatever.  The point is to sign a lease as soon as freaking possible.  It doesn't matter if you really aren't sold on a place - you must convince the owner that you and only you are the destined future tenant for the unit.  Why?  Because there are at least a dozen other winsome and articulate and appallingly rich young professionals just like you trying to do exactly the same thing.

Basically, one of these apartments can be posted on Craigslist at 3 p.m., and if you email them half an hour later, you are number five in line.  That's how high the demand is.  But even your placement in line doesn't matter much - these apartments don't go first come, first serve.  What counts is you making it to the designated showing decided based purely on the convenience of the owner.  That might mean Saturday at 2 (sorry if you had plans this weekend - if you don't make it to the showing, you're utterly SOL).  It might mean tomorrow at 4:30 (oh, is that usually when you're at work?  Guess you'll have to leave early on less than 24 hours notice!).  If you make it to the showing - and you must make it to the showing - you will be obligated to sign an application and authorize a credit check on the spot, plus make out a check for $25-$45 for your own credit to be scoped.  My partner's had hers run through whatever magical system they use upwards of four times in two weeks - it's so great to pay for the privilege of repeatedly being assured that you are a respectable, bill-paying citizen.

Making it through the application stage is nothing.  There are probably still ten other people, maybe more, who have done the same thing.  This whole securing an apartment process might involve four stages where you see the apartment, have a phone interview with the owner, have a personal interview with the owner, fill out a credit check/application, have your references called (and they will call your references), and then possibly still not be offered a lease.

You might get really, really, really close - a verbal agreement on the phone, a written agreement through email, even set up a time to sign on the dotted line - when capitalism body slams you against those sweet hardwood floors.

The problem is, as you might suspect, ka-ching ka-ching, a case of the Benjamins.  Being both desperate and in a high-income tax bracket makes people do strange, strange things.  Such as bidding on rentals.  Yes!  To secure a one bedroom, one must bid on it like it's the Queen Jewels at Christie's Auction House!  And this means, of course, that the most desperate and most wealthy always wins.

Let me tell you, dear readers...I now know there are some very desperate and very wealthy people out there.  One who will, for example, bid on a $1550 apartment for $1800 a month, a full $250 over the listed rent, plus covering painting costs.  Or another who will offer a full 12 months rent upfront, somewhere around a $16,000 one-time payment for one unit.  (Why they don't drop that on a down payment for condo of their own, I have no idea...the market is not logical, only driven by the principle that s/he-with-the-most-cash-wins.)

Desperation for housing inflates these units to obnoxious, impossibly high levels.  There are two sides to this capitalist inflation - one side are us prospective renters who stomp on each other and wave our wallets around to entice future landlords.  The other side are the owners, who take advantage of the irrationality of the market and ride out the capitalism for all its worth.  In our experience, owners may even narrow down their list of applicants to a handful of those who's credit checks have cleared and who made similar bids, and then ask them to name their "best offer," thereby ensuring the price will go up even more than the original bids.  Sometimes I feel like we're trying to get our kid into a NYC nursery school.

Clearly there is no way this can be sustained - at some point (I hope), people are going to realize that $1800 for a one bedroom without a washer and dryer in unit and no covered parking space is absolutely outrageous.  By bidding against each other, we create a ridiculous housing bubble that ensures only semi-wealthy people live in the condos, and pretty soon not even semi-wealthy people will be able to afford to live there.  We are not just pricing ourselves out of the market - we are pricing everyone out of the market.  I'm not sure where the invisible hand is yet, because the market hasn't self-corrected as far as I can tell - even if it all comes crashing down a few years from now, there will still be suckers like us paying inflated prices for months on end.

Capitalism only works because everyone is participating, competitively bidding on a supposedly scare product - myself included.  It also feels like there aren't any other options - surely if we want an apartment under these circumstances, we have to play the capitalism game.  We can't tell the owner, "You know, I think your original rate is already inflated, so I'm going to price you a little lower since it reflects the actual value of the unit," and we can't call a meeting of all the prospective tenants and say, "Alright, y'all - who really needs this place?  And let's agree to cap the bidding, okay?  It's us versus the owning class!  We need to work together in collective solidarity until we all have homes!"  If I thought Marx could really spare us from what we've had to do thus far, I would have tried other tactics.  But resistance doesn't work on an individual level, and this is a clear case in which I'm totally pwned by capitalism.  Part of the sinister logic of capitalism is that it shuts down all other paths, and leaves no option but playing Monopoly.