Get Email Updates for ECEDA

Corporate News

Subscribe to RSSSubscribe
Next »

RENTERS ON THE RISE: TRI-COUNTY NUMBERS ECHO NATIONAL TREND

June 19, 2011

Montgomery Advertiser
Article Source »

The tri-county saw a trend toward more renters, accord­ing to data from the Census re­leased last week.

Montgomery, Elmore and Autauga counties saw increas­es in both owner- and renter-occupied housing from 2000 to 2010, but the number of house­holds living in rental properties increased at a higher rate than that of homeowners.

Not surprising, said Mark Vitner, a senior economist with Wells Fargo.

"The housing boom kind of peaked in the middle of the decade," he said. "The rental numbers really went up toward the end."

And now, as lenders are re­quiring more money down and better credit scores from those looking for mortgages, apart­ment construction has re­mained a strong segment of the economy.

"We've had a lot more multi-family housing (constructed) in Elmore and Autauga counties," said Jo Glenn of the Montgom­ery Area Realtors Association. "Before that, most of the apart­ments were in Montgomery."

Glenn agreed that in the wake of the housing market crash, some people may be renting instead of buying be­cause obtaining a mortgage has become more difficult.

In Montgomery County, the number of owner-occupied housing units increased by 142 between 2000 and 2010. Renter-occupied units increased by 3,771.

Keivan Deravi, an economist and Auburn Montgomery pro­fessor, said that in Elmore and Autauga counties, where there was a limited supply of rental units in 2000, any increase dur­ing the 10 years could seem like it was large. He recom­mended looking at the actual number increase, not the per­centage.

He attributed the increase in rental occupancy in the River Region to a couple of factors -- the substantial jump in the cost of housing in the earlier part of the decade that made housing less affordable for some mar­kets, and job creation, includ­ing Hyundai Motor Manufac­turing America and its suppliers.

Though all three River Re­gion counties have seen popula­tion growth, Montgomery's growth, at about 2.6 percent, was much smaller than neigh­boring Autauga and Elmore counties at 24.9 and 20.3 per­cent, respectively.

"When the population began to disperse, there was a need for more apartments," Deravi said.

Elmore County Commission­er David Bowen said he and other leaders are "tickled pink" with the population growth, be it homeowners or renters.

"We've had growth in all areas of the county and we're satisfied with that," he said.

His district covers Wetump­ka, where a 56-unit rental com­plex is now going up. He attri­butes the growth to people being drawn to Elmore Coun­ty's recreation opportunities, low taxes and "smaller- town atmosphere than the big city."

Vitner believes the trend to­ward more people renting won't be one that changes any­time soon.

Vitner said home sales may improve late next year, but first, the glut of foreclosed homes needs to be cleared from the market. But even aft­er that happens, he said the economic downturn will not soon be forgotten.

"I think this recession has scared people into thinking, 'I don't want to be tied to an area. If I need to move, I want to be able to move.'" Vitner said. "Clearly, that thinking is going to stick around as long as the unemployment rate is around 9 percent."