Brian Tuttle keeps up his 16,000-square-foot Florida pad with help from five lodgers. (Photo: Jeffrey Salter)
It's a Thursday night>, and we're kicking back by the pool with fellow tenants in West Palm Beach, Fla. The air is warm, the music is blasting, and the beer is flowing. Our landlord is hanging with us, which is a bit awkward, but he's being cool, cracking jokes as he sips on a Bud Light Lime.
Sometime later we wind down the party to get some shut-eye before another workday. After saying good night, we scatter to our living quarters. Although some of us have a long way to walk, we'll still wind up under the same roof, in the 16,000-square-foot, seven-bedroom Mediterranean-style palace we share. And our landlord will be there too, 50 feet away from our room, in the grand master suite after all, it's his house.
Have you stayed in a mansion lately? With the housing slump increasingly infecting the homes of the well-heeled, owners of sprawling properties from California to Connecticut have decided to quietly take in boarders, charging rents that they hope will help keep them afloat. In Providence, R.I., there's a charming room for hire in a $1.6 million, 15,000-square-foot Dutch colonial on the National Register of Historic Places. A surprisingly reasonable $600 a month pays for a private suite that features a walk-in closet and marbled bathroom in a gated Florida community though the tenant had better like falling asleep to the sound of giggles or gunshots, because the room next door is a nine-seat home movie theater. Outside Seattle, boarders in one $1.5 million home get the added perk of using the family's Mercedes convertible and hopefully won't mind the occasional spell of house-sitting. (The landlords know which tenants they can trust with the keys, thanks in part to some well-placed security cameras.)
Naturally, the economy is a big factor in driving wealthy homeowners to rethink their living space. Many of them bought or built at a time when home prices were strong, construction was booming, and living large, with formal dining rooms and lavish game-filled man caves, was a testament to success. But today, the housing downturn is hitting the gated-community set especially hard. Five years ago, fewer than 1 percent of borrowers with mortgages of a million dollars or more were delinquent on their loans; today, almost 14 percent of such borrowers are delinquent, according to research firm CoreLogic, and that number has kept growing even as delinquencies have dropped among average-joe homeowners. At the same time, even though the economy is picking up a tad, larger homes are staying on the market longer and selling for less when they do move. Under these tough conditions, many mansion owners in need are opting to fetch a pretty penny by renting out their vast rooms. "Renting out a room definitely wasn't what they expected," says Dani Babb, founder of a real estate consulting firm in Orange County, Calif., but for avoiding foreclosure trouble, it can be "the next-best option."
Whatever their motivations, these homeowners are using the rent checks for expenses that, in the past, would have come from other income. Brian Tuttle, our craggy, blue-eyed landlord in West Palm Beach, had a real estate development business that he says is now in ruins. He spent $5 million to build and furnish his sprawling abode, but local sales records suggest it would sell for less than half that today. So he's relying on the rental income from five tenants each month to help pay the $1,400 electric bill, the $2,000 tab for insurance and his ex-wife's alimony. But challenges like Tuttle's sounded like an opportunity to us: After combing through Craigslist and revealing our journalistic identity to prospective landlords, why not pay up and try out the life of a mansion boarder for a few days ourselves?
In one sense, letting strangers crash in a private abode is a throwback to the late 1800s, when cash-strapped families turned their homes into boarding houses. Though there aren't hard numbers on how many folks are taking in lodgers, online listings and conversations with industry consultants suggest the trend is increasing among the upscale set. Real estate agents say homeowners like the arrangement because they can keep up outward appearances while keeping financial woes hush-hush. Indeed, many homeowners we spoke with didn't want to be written about for fear of neighbors or friends learning they've fallen on hard times. And the rentals often aren't popular with the neighbors. Pia Trigiani, a property association attorney in Alexandria, Va., says that restrictions on rentals including minimum-stay requirements are now among the most popular new rules within homeowners' associations.
Perhaps that's why there's no anxiety on display on the breezy afternoon when we arrive in Redmond, Wash., a ritzy community 30 minutes from downtown Seattle that's home to the Microsoft campus. Our new landlord, Dominic Nguyen, hands us the house key and says, "Make yourself at home." He jets off to run errands, so we snoop around. Our new digs feature Viking appliances, luxurious leather couches and 12 flat-screen TVs three per family member. We discover a private trout pond out back, a sweet set of poker chips in a silver case and a large soaking tub in the master bath. It's not until later that we're told there are 16 cameras positioned all around the 4,500-square-foot home, ensuring that a housekeeper or a renter doesn't make off with one of the autographed Michael Jordan jerseys in the bonus room.
Nguyen and his wife, Ha Ana Tran, say the cameras have been around since 2008; the boarders showed up a year later. A director at a software-consulting company, Nguyen owns rental properties on the side, and when the economy went south, he had to lower his rates. With the couple's cash flow dwindling, some of their favorite hobbies playing poker in Vegas , traveling to Asia and Orlando with the kids started to look financially unwise. But opening up their extra bedroom to a summer intern from the tech behemoth down the street and charging $900 a month for rent kept them from having to cut back, says Tran: "We can do things when we want instead of waiting."
That first intern is long gone, but the income stream remains. And Nguyen and Tran seem eager to make their boarders feel at home very much at home. Tran, whose personality is much bigger than her petite frame, bombards guests with jokes and personal questions. One night we plan to cook dinner on the six-burner stove top, but our plans get derailed when the couple insist we join them at a local sushi restaurant. "Don't you want to eat with the family?" Tran asks. At other times we find ourselves apologizing for being late for movie night, and we let Tran and Nguyen know what hour we're setting the alarm for in the morning. We haven't given any other adults such a detailed rundown of our whereabouts since middle school. (Our privacy doesn't seem to be a big concern for the couple's 8-year-old son, either; one night he barrels through the door of our room while we're changing into sweatpants.) Tran says her boarders so far haven't minded merging with the family over poker games and DVD-watching. If she got the sense that a tenant didn't want to hang with the family, she says, "maybe it wouldn't be a good fit."
And anyway, joining the household has its perks after all, we get to drive that Mercedes. It's a cold night, but we're dying to drive with the top down, so the soft-spoken, paternal Nguyen, gentleman that he is, gives us a blanket.
After the intimacy> of our Redmond digs, we're relieved a week later when we find dead bolts installed on our new room in West Palm Beach. The rules laid out by Tuttle seem simple enough. Rent is due the first of the month. Animals under 20 pounds are allowed. No male tenants, though, and this makes us squirm a bit no boys allowed overnight. For a grown adult and a paying customer, this seems like a throwback to summer camp. (Tuttle explains that it's necessary because he has a teenage daughter.) But as soon as we start to explore the stately manor, any annoyance changes to awe. The marble driveway leads to an eight-car garage; the cavernous dining room seats 30. Hand-carved moldings line the 26-foot ceiling in the grand room, and green onyx columns imported from Bolivia flank the tub in the master bath. We'll never go hungry, it seems, because there are six refrigerators, two ovens and enough granite counter space to cook for a king and his court. And we can let go of our anxiety about bedbugs in movie theaters; we'll be watching flicks in the home movie theater, curled up in one of Tuttle's leather recliners.
Photographs: John Granan (Redmond) and Jeffrey Salter (West Palm Beach).
It's a lot of space for one man, and in its nearly complete emptiness, it's a symbol of how far things have sunk for Tuttle, who estimates that his net worth reached $90 million before Florida's housing bubble burst. Indeed, conversations with other mansion landlords suggest that many of them are taking on tenants for psychological relief as well as financial help. During the height of his prosperous career as a graphic artist and game developer, Jesper Myrfors saw nothing excessive in the 13,000-square-foot home he renovated in Snohomish, Wash., where he'd host lavish parties and stage theatrical events. Today, he says, an investment in a start-up effort has depleted his savings, and taking on boarders seems like the logical move, but he's also just grateful to have some people nearby. After all, "our house is so big we don't use a lot of it." Indeed, some novice landlords say they aren't motivated by finances as much as by the desire to have camaraderie in a house that's just too big. Jim Verity, a designer in Providence, R.I., wants to find a renter with an entrepreneurial spirit whom he could mentor "and eat dinner with every once in a while."
For his part, Tuttle certainly has enough company including his invited reporter, he's renting to five women, all happy to share beers with their well-dressed landlord. Although the 51-year-old Tuttle has the personality of the eternal college kid, our company doesn't seem to cheer him up that much. And there are signs of hard times amid the grandeur. Many of the 1,000-plus light bulbs are burned out, and dining room drawers that once held fine china now serve as pantries for boarders. These days it's not uncommon to find Tuttle cleaning out coconuts from the pool or tidying up the family room. "I'm a damn slave to this house," he says. And many of the tenants have seen better days themselves. Danielle Acton, a 24-year-old secretary for the state government, is going through a divorce and calls her digs "the stepping stone to the next thing." Kelli Gallatin, 39, says she moved in to Tuttle's old entertainment room (he sold the air-hockey table and moved the pool table to accommodate her) to save money after her massage therapy clientele dwindled. Our housemates often seem embarrassed to live in a fabulous estate that isn't their own. "They feel as if they're not successful," Tuttle says of his tenants. Then again, having the freedom to sun by the pool or host a dinner party for 30 can brighten any renter's day. And if a sulking renter needs alone time, as Acton puts it, "You can go days here without running into anyone."
If Acton takes a walk around the neighborhood, however, she's likely to bump into another mansion boarder. In West Palm Beach, where 21 percent of the homes with million-dollar mortgages are in delinquency or foreclosure, local homeowners say amateur landlording is on the rise. And in Tuttle's development, the Banyan Lakes Property Owners' Association recently passed a rule requiring all tenants to go through a background check (paid for by the landlord) before being allowed to move in and restricting the number of times a year that a landlord can rent out the same room. Association manager Faith Kulla says the new amendment was a necessary step. "We didn't want people coming and going, like a boarding-house situation," Kulla says, adding, "it's rampant."
Whatever anyone thinks of the new rental trend, it can certainly disturb the peace: On our last morning in the mansion, we awake to the burglar alarm blaring. But there's no intruder on site; it's just one of the newest renters, who set it off when she stepped outside for a smoke. As we mosey through the long hallways to say goodbye, we're relieved to be going home.
Photographs: David Carmack (Providence) and Jeffrey Salter (Tarpon Springs).