At 29 years of age, Alexandria Ocasio-Cortez may have become the youngest women ever elected to serve in Congress. But that doesn’t mean she’s free from the hardships facing Americans who are living paycheck to paycheck.
Ocasio-Cortez, who shocked observers when she defeated Democratic political veteran Rep. Joe Crowley in a primary race back in June on her way to her overall election to the House of Representatives, described her current financial worries in an interview with The New York Times this week.
Americans are moving to new cities at the lowest rate since World War II.
“I have three months without a salary before I’m a member of Congress,” Ocasio-Cortez said. “So, how do I get an apartment?”
she argued that the need to squirrel away money to save for an apartment in Washington, D.C. is one of the “many little ways in which our electoral system isn’t even designed (nor prepared) for working-class people to lead.”
Scores of people on social media said they related to Ocasio-Cortez’s difficulties — and some even offered her a place to stay.
Alexandria Ocasio-Cortez can’t afford an apartment in DC…girl same
— Hayley (@hayhayallday) November 9, 2018
Quick someone add Alexandria Ocasio-Cortez to the D.C. housing Facebook page.
— Josh Fuller (@joshfuller124) November 9, 2018
Indeed, the congresswoman-elect’s hardships are familiar to many Americans who are just starting out in their careers and struggling to afford housing. “If you’re a person coming out of college and don’t have savings, these can be things that seriously impact your decision-making on what you’re doing with your career and where you can move,” said Chris Salviati, housing economist at real-estate website Apartment List.
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Over roughly the past two decades, rent prices have increased 61%, while incomes for younger households have only risen 31%, according to an Apartment List study. That explains why 7.9% of non-student millennials receive financial assistance from family members to pay their rents. A study from Zillow
estimated that 22.5% of millennials are living at home with their parents.
Moreover, socio-economic status influences the reasons people choose to move. People with college degrees are more likely to move for a job, while people without higher education are inclined to move to find somewhere that is more affordable, another Apartment List study found.
Americans are moving to new cities at the lowest rate since World War II, with just over 11% of people choosing to relocate in 2016 down from roughly 20% in the 1980s. And factors such as restrictive land-use laws, which have driven up housing costs along the coasts in particular, have made it far more difficult for people with fewer financial resources to make a move.
Some argue that the decline in mobility in Americans is even exacerbating the growing gap in wealth between the richest and poorest Americans.
But workers in certain industries, such as technology or, yes, government, are more likely to face the need to move to a new city for work, Salviati said. “If you’re any employee who works in these industries you need to think about how likely it is you’ll need to make one of these moves,” he said.
Read more: Less than 20% of apartments are affordable for middle-income black renters
Here are some ways that Ocasio-Cortez and others can reduce the financial burden moving for work can take:
Build up an emergency reserve in advance
Moving doesn’t come cheap. Paying a company to move the items from a two-bedroom apartment within the same town costs anywhere from $400 to $700, according to estimates from HomeAdvisor. Moving across the country is exponentially more expensive.
And that’s just one piece to the puzzle. “Whether you are buying and face closing costs or renting and face a security deposit plus the possibility of move-in or amenity fees, you’ll want to be prepared for these surprises,” said Danielle Hale, chief economist at Realtor.com.
Consequently, workers should consider setting aside money in their emergency funds on an ongoing basis in case they ever need to move for work, particularly if they work in a sector with high turnover.
Study your new housing market as much as possible ahead of time
Every city’s housing market is different. In New York, for instance, having a real estate broker can be a necessity. In Washington, D.C., however, many buildings will market their own apartments.
Zillow senior economist Aaron Terrazas advises that would-be re-locaters take between two and three months to study listings on real-estate websites to learn what types of units are on the market and how quickly they get scooped up.
This information won’t just come in handy for finding a place to live, but also for negotiating a lower price. “When it comes to negotiation, the important point is to have your pulse on the market,” Terrazas said. “That way you’ll have a sense of what prices are reasonable.”
Be wary of fraudulent listings, especially if it looks like a great deal
Over 5 million renters nationwide have lost money in rental scams, according to Apartment List. Movers are among the most susceptible to rental fraud because oftentimes they must choose housing in cities they don’t know well, sight unseen.
“If you’re not familiar with the city [where] you’re looking, you’re going to be at higher risk of landing on a fraudulent listing,” Salviati said. Anytime that someone’s asking you to put down some type of payment sight unseen, that’s a red flag you should look out for.”
Also see: Millennials spend a staggering amount on rent by the time they’re 30
Consider short-term housing possibilities or roommates
Since searching for housing in-person is recommended, many experts suggest that movers consider securing short-term housing, such as through a site like Airbnb or by crashing with a friend. While doing this can be costly, it will allow the person to get a feel for their new city, decide which neighborhood they want to live in and negotiate face-to-face to get the best deal.
And in cities like Washington, a better option for those having difficulty affording housing is to search for roommates rather than one’s own apartment. “One of the unique features of D.C. in contrast to New York is this culture of group living,” Terrazas said. “It attracts so many bright, talented young people that there’s a culture of shared living space.”
Indeed, many members of Congress choose to live together, given the high cost of having to maintain a residence in D.C. and one in their home district. Representative Carolyn Maloney, a Democrat who represents New York’s 12th congressional district, rents out rooms in a town home she owns in Southeast Washington to her fellow Democratic congresswomen.
Another possibility: Living like you’re back in college. “In large tech hubs like San Francisco, there are dormitory-like spaces where there’s shared bathroom and kitchens that charge much cheaper rent,” said Crystal Chen, data analyst for real-estate website Zumper.
Ask your new employer for a salary advance or reimbursement for moving costs
One benefit of today’s competitive job market: Employers may be willing to make more concessions in order to attract the best talent. “If you’re moving for work, see if you can negotiate an upfront bonus to help carry you through these expenses,” Hale said. “Additionally, a letter from your employer indicating your new salary will help with qualifying for both an apartment and a home.”
Jacob Passy is a personal-finance reporter for MarketWatch and is based in New York.
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