Every home my parents ever owned was eventually foreclosed on. In the late 1980s, they lost their first home, a tiny two-bedroom house on E Street in Rupert, Idaho, after my dad broke his back. They lost their second home, a log cabin we built in the mountains of Utah, after my dad lost his job working for a conveyor belt manufacturer.
Those foreclosures, and the lasting impact they had on my family, have given me a lifelong interest in the housing market. That interest has only grown in my adult life, as I've lived through the ups and downs of the 21st-century real estate market and the impact it has had on the economy.
Think about it: If you turned 18 in 2000, you are now 36 years old and have never lived a single day of your adult life in what would traditionally be called a "normal" housing market. You entered college or the workforce just as the housing boom of the 2000s started to take off. You entered your late 20s just as the housing market (and the economy in general) imploded. Now, you are entering your mid-to-late 30s just as a housing shortage is causing the market to boom and housing to become unaffordable again.
(Side note: And we wonder why a whole generation of people who've been locked out of the economic opportunities their parents had access to are angry and disillusioned with capitalism. It "might" not be the participation trophies their parents gave them. Instead, that disillusionment may be a rational response to a lifetime of experiencing a deeply dysfunctional economy.)
Addressing America's latest iteration of an ongoing housing crisis will require policy solutions. It will require politicians at the local, state, and federal level to make tough, often unpopular decisions.
But given that that isn't likely to happen anytime soon, homebuyers will have to rely on a growing number of startups leveraging technology to create efficiency, transparency, and cost savings in real estate transactions. One of those startups is Clever, a St. Louis-based company that recently closed a $500,000 seed-fund round.
(While that may not sound large to coastal readers, in the Midwest, where early-stage capital is incredibly scarce, $500,000 is a significant achievement.)
Clever's premise is simple. For homes selling for less than $350,000, the platform allows owners to sell their home for a flat $3,000 fee, using the services of the company's full-service agents. For a home selling for $349,000, the cost savings is more than $7,000. For homes selling for $150,000 (aka more affordable homes) the savings from using Clever is still $1,500.
Lowering transaction costs is an important step toward making housing more affordable.
"My co-founder and I are both active real estate investors in St. Louis," said CEO and co-founder Ben Mizes. "While Clever is not specifically an affordable housing solution, we know, from investing in neighborhoods in St. Louis where affordability is a real issue, that every little bit of savings helps. We're proud that Clever can be part of the solution and help make home ownership a reality for today's buyers."
Of course, making housing affordable for many Americans won't happen by saving $1,500. However, how often do politicians prioritize any initiative focused on making housing more affordable? Politicians--particularly at the local level--often treat affordable housing options like they are a highly contagious disease. On the other hand, startups like Clever see making the housing market simpler, more transparent, and ultimately more affordable as a market opportunity.
And for Clever's seed-round investors, that apparently was an idea worth investing in.