We’ve heard an awful lot about the housing market, as of late. Those Adjustable Rate Mortgages are adjusting, and the results aren’t pretty. Foreclosures abound. People are losing the roofs over their heads.
As a pastor, I’ve been told to sign on to an ARM on several occasions. Thank God, I never did. But the people who were trying to talk me into it (often bankers) were quite persuasive.
Actually, what was compelling was simply trying to figure out some way to be able to afford a home. Pastors are often in a difficult position, nowadays. We often don’t make enough money to live in the area in which we minister.
The D.C. churches are just starting to figure this out, as more and more new pastor negotiations begin to crumble around cost-of-living issues. I think congregations might be waking up.
It’s just difficult. Our calling committees are filled with people in their sixties, who bought their homes when the a high mortgage equaled two years’ salary (revised on 4/8, I originally had one year, but I was advised that it was two). Now, mortgages can be ten times a year’s salary. And, of course, churches never have enough money.
In the PCUSA, each church used to have a manse (or parsonage, or church-owned home). And it worked out pretty well, because the age expectancy was low. But then, people began to live well past their retirement age, and when they hit 65, they moved out of the manse, with nowhere to go. While most Americans relied heavily on the housing equity to get through their twilight years, pastors had nothing to draw upon.
So, churches began to sell their homes and pastors began buying their own places. Which worked for a short time. But then housing costs ballooned. This is fantastic news for the Boomers who are about to hang it up, but it’s not working out too well for a new generation of pastors entering the ministry.
What’s the future of housing for pastors? Here are some options:
Church-owned home. This could be great, especially if you live in an urban area, where there’s no way to afford a place in the neighborhood. But, there are some considerable problems with this arrangement. I know. I lived in one. Other than the equity thing, maintenance is often an issue, because the church members are not so fast and furious about getting things done. And, of course, then they’d rather do it themselves than hire a professional. And I won’t even mention the faux-Laura-Ashley bountiful rose borders that I had to look at for three years (they put them up just for me, without asking. Because they knew I would love them).
Church-owned home, with an equity account. I’ve heard of congregations setting these up. The pastor lives in a manse, but also has an account where equity can accrue at the rate that it would if s/he owned the home. Potential problems? We miss out on significant tax advantages if we don’t own our homes. Plus, I don’t think the equity accounts consider the fluctuations in housing prices.
Shared-equity home. This is what I have now. We own two-thirds. The church owns one-third. There are all kinds of good and bad things about the arrangement. A couple good things: we live in a neighborhood that we could never afford, close to the church. The arrangement takes a lot of pressure off of us. I mean, we have enough money to live comfortably. A couple bad things: we assume all the costs for taxes, maintenance, lawn care, etc. And the church will get one-third of the profit (or loss). And, like a manse, the house is tied to the job.
Living far away from our church was never an option for us. It’s just terrible environmental stewardship, among other things.
So, what do you think our future options will be? What’s better? The manse or owning a home? What should seminarians look for? What do you know now that you wish you knew earlier?