Jeff, Dennis, and Peggy sit down to discuss the cost of living in Sparks, NV and get into some of the problems with living here when it comes to affordability in the housing market. After remembering what it was like when they each moved into a home or apartment years ago, they discuss some serious possibilities and challenge the opinions of anyone listening.
We have an issue though. And that issue is that it’s getting more expensive to live in both Sparks and Reno. Many people are feeling the pressure that they just can’t afford living here anymore. But why is that?
Is it the Tesla effect? That’s one possibility because with Tesla building their gigafactory, it promised to bring over 10,000 jobs which made Reno and Sparks a hotspot to live. The only problem with that is that land values, rent, and the cost for homes increased too. As people wanted to move here, it became obvious that you could make a lot of money selling or renting homes.
Not to mention there was the promise for huge tax discounts for large companies if they moved to Nevada. We saw, Tesla, Apple, Amazon, and so many more larger companies look at our state as a great place to set up shot and bring a boost to our economy. But at what cost?
One caveat to all this was that some other cities or counties saw financial incentives for having these larger companies but even they couldn’t support the growth so other neighboring cities had to provide a place for these new residents to live. Sparks and Reno is a prime example.
The trouble with that is Reno and Sparks had to support this growth while other cities and counties got the financial tax income from housing the new companies such as Tesla’s gigafactory.
The next question is did it provide jobs locally? Well yes, and no. It did provide jobs and there were many people here locally that got a job, but it didn’t employ the promised 10,000 jobs. Many people here in Nevada didn’t have the job requirements to get hired. So Tesla hired out of state as well.
It wasn’t all like that though. Tesla did provided some union work but even that was not something that would be consistent forever.
But back to the issue of the cost of living here in Sparks. Because of stuff like this happening, it’s getting more expensive to live here. Many people can’t afford the raising prices of homes and many locals are having to work multiple lower paid jobs just to make ends meat. Which brings up another issue which is the fact that sustainable wages are not being met.
It boils down to the fact that growth is expected to continue but you have to ask yourself, are the locals being neglected?
What Sparks does need is more affordable house, not luxury housing.
It wasn’t too long before this episode aired that Sparks broke new ground on more luxury apartments with a 1 bedroom apartment start at $1200 and up. Sure the new apartments offer many luxuries but it’s not solving the problem when say a single parent who is trying to make ends meat already has to work multiple jobs and isn’t sure how they are going to make it next month when rent is said to increase again. They can’t find another place because all of the out-of-towners have taken up any available spots to live. Many people are simply just getting priced out of this city.
And some places, while increasing rent, are not doing enough to take care of their residents either. A few apartments, (one of which Jeff once lived in and he recently revisited), are hiking up their rent regularly, but their steps are falling apart, the surrounding areas are not being well maintained and the buildings themselves are in shambles. So where is that money going?
This also is effecting local businesses too. Some places are having to close up shop just because it’s getting too expensive to run their business especially when they are compeating against larger companies that are capable of paying the higher rents charges.
In all fairness though, it’s not always because the landlord is just trying to make extra money. Remember when we talked about the city not getting some of the tax incentives? Well, some other ways the much needed funds can be found is by increasing rates that landlords or home owners have to to pay. It really can be a double edged sword!
Taking responsibility for your own expenses…
We can’t just blame it on our local city though. While things are getting bad in many places and it has nothing to do with how we spend our money, we all should look at our spending habits and how we live too. For example, splurging on expensive coffee every day when you have bills that are stacking up. For many, having control of their finances will make the difference in how you live. Do you feel you have control of your finances? If the answer is no or “I’m not sure”, then maybe it’s time to take a closer look at that and take charge.
Dave Ramsey has a program to help you by talking about 7 baby steps to get out of debt and prepare for retirement. This is a course that will cost you money but you can check out the course at smartdollar.com.
A cheaper approach is checking out the Motley Fools book: You Have More Than You Think. It’s an older book but still has a lot of information on how to view your finances and look at where all of your money may be going.
The Possibilities of Gentrification…
So let’s take a step back again to the concept that locals are being priced out of their homes. Enter the possibility of gentrification.
What is Gentrification? Well, Merriam Webster defines it as the process of renewal and rebuilding accompanying the influx of middle-class or affluent people into deteriorating areas that often displaces poorer residents.
In short it is the process of working out lower class locals for more desirable residents. But could this be the path to gentrification? It certainly is possible. But that is something our residents have to conclude.
In this episode we talked about some myths surrounding gentrification. An article from the Washing Post talks about five myths regarding this notion with one myth we mentioned which is that it lowers crime; However a study from NCJRS (National Criminal Justice Reference Service) says it may actually increase crime.
Washington Post talks about other myths – show notes
So What’s one possible solution to all this?
Inclusive Zoning – Developers set aside portion of homes for low income
Questions to you, the listener
- Do you feel your city is struggling with affordable housing?
- Are you a landlord? Do you have a different view on things?
- Are you renting or owning your home? Is it a struggle for you or someone you know?
- Do you feel the cost of living in your area is reasonable?
- What other advice or thoughts do you have about this topic?
Links and research
KOLO News article about the Tesla Effect:
https://www.kolotv.com/content/news/Housing-Crisis-The-Tesla-Effect-440208653.html
KOLO News article about new luxury apartments
https://www.kolotv.com/content/news/Ground-broken-for-new-Sparks-apartment-complex-489775401.html
Washington Post article: Five myths about gentrification
Study from NCJRS about crime rates regarding gentrification
https://www.ncjrs.gov/App/publications/Abstract.aspx?id=125395
Dave Ramsey’s Smart Dollar Program
Montley Fool’s: You have more than you think – Get it on Amazon
Another article about impacting housing affordability
https://dsnews.com/daily-dose/08-07-2018/call-less-zoning
Oops…there is an update!
The article about Trump’s apartments mentioned in the episode were actually about how he discriminated against tenants and also how he was a nightmare of a landlord. He was sued for not taking care of his apartments and was said to simply find ways to push them out. See some of the articles explaining it here and here.
This episode’s shout out!
Are you a resident of either Sparks, NV, Reno, or live in a surrounding neighborhood? Do you have a business or non-profit that serves the local community? We are interested in providing a free shout-out to you and your business or nonprofit organization in one of our episodes!
All we ask is that you help us by telling your friends, family, and customers about the Sparks of Interest podcast.
We are willing to do the recording for you or if you have a 30 second commercial already, we would be happy to air that instead!
If you are interested please send us your contact information along with a little bit of information about your business or non profit organization to mailbag@sparksofinterest.net
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