Rent shock: Residents reeling from double-digit increases in Dayton area
DAYTON — Alan Limke knew the rent for his Dayton apartment would go up in September, but instead of the simple 3% increase specified in his lease, he will pay 9% more instead.
“I’m not happy about it,” said Limke, 56, who is divorced and rents a one-bedroom apartment downtown. “I’m a veteran teacher, so I’m fine. I can afford it, but…I won’t get a 9% or 10% raise this year. We are in negotiations now. We would be lucky if we got 2 or 3 percent.
“I have to change some things in my life.”
Limke is facing what many tenants in the region and the country are facing: rising rents outpacing wages among the worst inflation in about 40 years.
Rents saw a record 11.3% increase nationwide in 2021, according to real estate research firm CoStar Group. The average rent for a studio apartment in the city of Dayton is $907, an increase of 20% over the previous year, according to data from Rent.com. The average one-bedroom rent in Dayton is $1,026, an increase of 12%, and the average rent for a two-bedroom apartment is $947, an increase of 3%.
Market rents have been rising for years, said Jennifer Illanz, chair of the board of the Greater Dayton Apartment Association. Average rent growth has typically been around 3-4%, but recently it has moved to an average growth of 7-8%, Illanz said.
“The region and the country lack rental housing,” she said. “Occupancy rates are at an all-time high, putting further pressure on our nation’s limited and aging housing stock and putting upward pressure on rents.
Some of the contributing factors include inflation, supply chain and labor shortages which are further weighing on the housing industry, Illanz said.
“Along with the cost of maintenance supplies, construction costs and salaries, it had a huge impact on the communities,” she said.
The scorching housing market had a big impact on rising rents, Illanz said.
“As housing prices rise, this has pushed up market rent prices,” she said. “In addition, people who sold their homes turned to renting because they couldn’t find a new home to buy. With limited availability, this has pushed communities to raise rents even further.
rent shock sticker
There is a misconception that owners of rental properties enjoy significant markups, according to the National Apartment Association. But according to a 2021 survey by the organization, only 9 cents of every dollar is returned to owners as profit. The rest is spent on the mortgage on the property (38 cents), operating expenses (17 cents) and property taxes (15 cents). There are also capital expenditures, including roof and HVAC replacements and other major repairs (11 cents) and payroll expenditures (10 cents).
It’s cold comfort for Corenda Williams, 26, who said she received 30 days’ notice in December that the rent for her two-bedroom apartment in Moraine would drop from $769 to $1,100 (43 per cent).
“I was definitely angry because I just didn’t have it in my budget,” said Williams, a home health aide and single mother of four children aged six months to 9 years old.
“I base my bills on a certain percentage, so when I have 30 days to come up with a lot more money…it becomes a question of budget. I’m definitely having trouble.
Dipping into her savings helped to some extent, as did relying on lots of overtime, but Williams said she still had to live paycheck after paycheck, sometimes owing people money. here the end of the week.
Skyrocketing gas prices aren’t helping, she says. Williams drives a Yukon Denali for her 25-mile commute to work, a vehicle she chose in part because it offers three rows to haul her kids.
She said she looked for a place that charges lower rent but couldn’t find one.
“I looked at other options and worked on my credit so I could buy, but there’s no way to get a place to move in,” Williams said. “When there’s a place open, you have to have three times the income, and no one has three times the income to move in somewhere for a first month. It’s just crazy.
What can be done?
So what’s the long-term solution to slowing soaring rents?
“Build more units,” Illanz said. “We need more housing at all costs.”
Adam Blake, vice president of housing for CountyCorp, a nonprofit housing solutions organization that serves middle- and low-income residents, said he’s worked for the organization for 15 years and doesn’t had never seen the highest rental rates and lowest vacancy rates in the Dayton area.
“The norm was maybe 1 or 2 percent a year,” Blake said.
CountyCorp is home to “roughly 100% vulnerable populations,” he said. This includes disabled veterans with HUD-Veterans Affairs Supportive Housing (VASH) vouchers or people with Housing Choice vouchers.
“We are 99.9% busy,” he said. “I think we have a vacancy in 80 of our self-owned and operated units.”
People with housing benefit vouchers often find nowhere to live because landlords aren’t required to take a paying tenant with them, Blake said.
“And if you are a market rate private owner, why would you put your unit through the required inspection protocol when you have a waiting list of people for that unit who have no requirements that come with it. ?” he said.
Miami Valley Nonprofit Housing Collaborative retained Bowen National Research in June 2021 to conduct a housing needs assessment of Dayton and Montgomery County. This assessment showed that 46% of tenant households in the county earn less than $30,000.
Households earning $60,000 or more a year make up nearly 60% of all owner-occupied households, according to the assessment. Between 2021 and 2026, all of the projected growth in homeowner household income in Montgomery County is expected to occur among these higher-income households, driving increased demand for high-end housing.
Christian Gallegos, 25, said the rent for his three-bedroom Dayton-area apartment, which he shares with a friend, rose 10.4% in 2020, from $770 to $850, before to climb 64% and 78% in 2021 to $1,400 and $2,500, respectively. .
“I had to find at least another job or a side hustle to be able to pay my rent and my bills,” he said, noting that his friend had done the same. “Everything has increased in recent months.”
Dayton isn’t the only community seeing rent hikes, according to Rent.com. Miamisburg and Beavercreek saw average one-bedroom apartment rents rise 21% and 22%, respectively, while Springfield and Kettering rose 16% and 13%, respectively.
Lebanon increased the average rent for a two-bedroom apartment by 17%, while Fairborn and Miamisburg both increased by 10%.
Limke said he’s grateful to have a stable job and a good place to live, but rising rent for his Dayton apartment will mean a change to his “default” dining pattern, with buttermilk sandwiches peanut and jelly adorning the menu. twice a week and macaroni and cheese with tuna on the way out.
Jobs working at STEM camps this summer will help Limke offset the upcoming rent hike. Even if he had to move elsewhere, Limke said he realizes he “would run into pretty much the same thing from the economy as a whole.”
“If I were to buy a house now, I’m going to pay a bit more…so for now I plan to stay put,” he said.
The housing shortage is driving up rents in the Dayton area and much of the rest of the country.