When James Snider got laid off from Texas Instruments during the 2001 tech bust, he quickly landed another job with a technology trade group.
After eight years handling marketing and business development for the group, Snider lost that job in 2009 during the Great Recession. This time it was very different. Once bringing in as much as $120,000 a year, Snider, then 55, would spend the next three years virtually unemployed except for one-off jobs such as house painting.
Like Snider, others around the country have had to make sacrifices to pay the mortgage or rent. While the housing market and economy are on the mend, challenges remain. During the past three years, more than half of all U.S. adults have had to make at least one sacrifice to cover their rent or mortgage, according to a recent survey from the MacArthur Foundation.
We were able to make our mortgage payment primarily because we had been saving our whole life for that rainy day.
— Homeowner James Snider
Although the unemployment rate had declined to 6.1 percent in June — the lowest since September 2008 — a record 92 million Americans remain out of the workforce as more people give up searching.
A dwindling labor force is not good for housing, according to Octavio Nuiry of real estate information company RealtyTrac. “With the pool of employed homebuyers shrinking, there are fewer homebuyers with jobs,” he said. “For housing to pick up steam, the labor force participation rate needs to increase.”
That’s not good news for the self-storage industry. If Americans can’t afford to buy or upgrade homes, then they might be less likely to use storage units; moving is the main driver of self-storage rentals in the U.S.
Managing the money
Snider was able to hang onto his home in Southlake, a suburb of Dallas-Fort Worth, through wise money management.
“We were able to make our mortgage payment primarily because we had been saving our whole life for that rainy day,” Snider said. “Little did we know that rainy day was going to last three years.”
Snider’s wife, a stay-at-home mom, went to work as a substitute teacher; their high school-age son pitched in with part-time jobs. Snider found what work he could while searching for an elusive full-time position.
Holiday celebrations and vacations got cut, and Snider began wearing old yard-work clothes each day to save nicer duds for professional events.
“We barely watered the lawn,” he recalled. “We had the shabbiest lawn in the neighborhood with a bunch of dead bushes.”
Help from strangers
Snider found the most humbling experience was not taking jobs like a $10-an-hour gig at the State Fair of Texas but rather accepting the benevolence of strangers.
As soon as you get laid off, find a way to cut your budget 15 percent.
— Homeowner James Snider
“Out of the blue, an envelope would show up with no return address,” he said. “Inside would be a couple hundred dollars.”
Because Snider’s mortgage payment didn’t include taxes and insurance, the annual tax bill of about $10,000 always brought thoughts of selling, but because of refinancings, the monthly mortgage bill already was comparable to renting a two-bedroom apartment. Snider said he would sell shares of stock each year to pay the tax bill.
Housing challenges persist
Teresa McNiel, a Realtor at Coldwell Banker who has spent more than 25 years in the business, said lack of affordable housing is keeping some buyers on the sidelines.
“Above $350,000 is a really slow sale, but if it’s priced under $200,000, it’s gone quickly,” she said.
Several builders recently have broken ground on affordable housing in her town of Waxahachie, south of Dallas, to ease the shortage. But that’s not housing’s only challenge, McNiel said.
“Student loans are a big problem for the would-be homeowner,” she said. Some buyers with student loan debt try to qualify for a mortgage and can’t, while others aren’t bothering to try, she said.
“It’s not just the students, either,” she said. “Sometimes the parents have taken out the loans.”
In one recent instance, two parents she was helping couldn’t qualify for a mortgage based on the student loans they’d taken out for their college-age kids.
Now 60, Snider is employed again, thanks to a connection he made doing a job no one else wanted.
“One of the jobs I picked up was selling Teflon sheets at the State Fair of Texas to people drinking a gallon of beer and eating a turkey leg,” Snider said. “It was a little hard, but I did a decent job.”
The gig put him in touch with Robert Engstrom of Engstrom Trading, a Swedish business that imports the nonstick cooking sheets. It was seeking a foothold in the U.S. restaurant and food industry under the name FTX Nonstick!
Snider joined the company about two years ago and leads its U.S. sales team.
“The money is not very good,” he acknowledged, “but the potential is fantastic.”
Snider said he survived the lean years by being smart about spending. He advises people to take quick action if they find themselves in a financial bind.
“As soon as you get laid off, find a way to cut your budget 15 percent. Once you do that, then look for the next 15 percent. Before you know it, you are living on half the money you were before,” Snider said.
He also recommends that people struggling to pay the mortgage or rent join a support group.
“When days were bad, and the soles of my shoes were pulling away and my feet were getting wet, I could always go to [my networking group], and I was in a room full of people who were in the same boat,” Snider recalled. “That was good for me to be around people who were pulling together, and we could all laugh about our struggles.”