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Apartment rentals stay hot

The Forum latest under construction

Apartment rentals stay hot

Apartment rentals stay hot

Construction continues on the Forum S...


      With construction of one new apartment complex well underway, and three slated to follow in the next year, Statesboro appears to be on the brink of another multi-family residential building "boom" as single family home ownership continues to decline across the southeast and the rest of the country.
      "Even though we won't be open until next summer, we are leasing bedrooms at an unprecedented rate," said Mitch Fender, head of community operations for The Forum, a 780-bed apartment complex that is currently being built on Highway 301 South near the Statesboro Bypass. "Of course, we will rent to anyone that meets the criteria including young professionals and families, but most complexes like ours are really designed with the needs of the student in mind."
      Joey Maxwell, owner of Maxwell-Reddick & Associates, Inc, believes there is a niche in the housing market right now that isn't being met, and potentially an opportunity being missed by developers.
      "I have worked with a number of developers over the years, including those developing single family residential neighborhoods and multifamily housing, and I have seen the marketplace really change in the last three years," he said.   "Neighborhood residential development is virtually nonexistent, there simply isn't a demand for it. There is a tremendous demand for residential rental property right now, particularly for the young professional."
      Recently released government statistics seem to bear out Maxwell's assessment of the current housing marketplace. The American dream of homeownership has seen its biggest drop since the Great Depression, according to new 2010 census figures released last week.
      "Gone are the days when a young person could graduate from college, buy a house, and come out of the mortgage closing with money in their pocket and a big screen television," Maxwell said. "They need to rent, build up their credit, and save some money. The apartments that are being built are great and are needed, but don't really cater to that market."
     Unemployed young adults are least likely to own, delaying first-time home purchases to live with Mom and Dad. Middle-aged adults 35-64, mostly homeowners who were hit with mortgage foreclosures or bankruptcy after the housing bust in 2006, are at their lowest levels of ownership in decades. Measured by race, the homeownership gap between whites and blacks is now at its widest since 1960, wiping out more than 40 years of gains.
      "The changes now taking place are mind-boggling: the housing market has completely crashed and attitudes toward housing are shifting from owning to renting," said Patrick Newport, economist with IHS Global Insight. "While ten years ago owning a home was the American dream, I'm not sure a lot of people still think that way. Given depressed housing values that could continue for at least another four to five years, it now makes more sense in most cases to rent than own."
      The analysis by the Census Bureau found the homeownership rate fell to 65.1 percent last year. While that level remains the second highest decennial rate, analysts say the U.S. may never return to its mid-decade housing boom peak in which nearly 70 percent of occupied households were owned by their residents.
      "In the U.S., there's still a strong cultural pull toward homeownership, because in normal times it's always been seen as a way to build net worth and equity," said Dan McCue, research manager at Harvard's Joint Center for Housing Studies.   But with many former homeowners now renting, he said, clearly that dynamic has changed: "It puts a renewed focus on rentals, and on ways to create new opportunities for low-income households to build their wealth."
      In addition to the Forum, the three new apartment complexes that are slated to come online in Bulloch County within the next 24 months are the Monarch Douglas (450 residents), the Varsity Lodge (500 residents), and Aspen Heights (800 residents). Each of those is also designed to meet the needs of university students, but not necessarily the new rental demands resulting from the collapsed housing market.
      "We have a number of professionals moving here that cannot sell their property elsewhere, or just aren't ready to buy right now," said Shannon Grindler, managing broker of Coldwell Banker Tanner Realty. "A number of people took such a loss on their home when they sold it, they are either not willing to take that chance again, or don't have the liquidity to purchase right now. I have rented a number of my listings to people in this situation."
      Whatever the reason(s) may be, the overall demand for rental properties in Statesboro remains very hot.
      "I really feel that our marketplace is underserved, and I believe that developers are beginning to hear that message," Maxwell said. "I know that banks are very interested in lending for multifamily development, and for the immediate to perhaps, long-term future, that is the type of new, large scale type of residential housing development that we will probably see."

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