VADNAIS HEIGHTS, Minn. (WCCO) — With economic uncertainty, many people are choosing to rent — not own — their homes. And it’s changing one market that used to struggle.
Apartment vacancy rates are approaching record low levels. In fact, one apartment building in Vadnais Heights is at 100 percent occupancy. And the Twin Cities vacancy rates are about half of what they were a year ago.
This is very different from the way things had been for the last decade.
For less than $700 a month, you can get a tidy apartment in a good neighborhood. In fact, one management company says their rents are pretty much the same as last year.
“Our average rent in 2010 was $747 and our average rent is $747 today, so we’ve had no movement in rent increases in that one-year period,” said Sue Schnarr of MidContinent Management.
Stable rents may be one reason apartments are popular. The other big reason remains the lingering mortgage crisis. Many people do not want to take the plunge into home ownership in an uncertain economy.
“Less and less young people today are finding that to be the American dream,” she said. “They want to live in urban areas of the city and be able to walk to bars and restaurants and theaters.”
That desire to live in the city means the downtown vacancy rates have plummeted. Minneapolis — which had a 6 percent vacancy rate last year — is now at 1.2 percent.
St. Paul apartments were 7.1 percent vacant last year, and that number is now just eight-tenths of a percent.
Morgan Mercer is a college student and a WCCO intern. She said it’s tough to find the apartment she needs for this fall.
“I want a clean apartment or a house to live in with enough space that I can move around and not be stuck in a 9-by-10-foot room,” she said.
And there is one more thing affecting the demand for apartments. In spite of the down economy, there have been jobs created in the Twin Cities.
That often means people coming from out of state, looking for apartments.