Meaghan and Stephen Jones make raviolis and garlic bread for dinner in their Chattanooga apartment on Tuesday. The two realized that a house would require too much of a financial commitment, which conflicts with their plans of becoming missionaries.Amber Leigh, an apartment-dwelling mother of four, lost her $240,000 home to foreclosure after a car slammed head-on into her husband’s vehicle, leaving him disabled.
The family didn’t pay the bills, so the bank took back the house.
AFTER THE FALLDespite the fall in home ownership, it can be cheaper to buy a home today.The monthly payments for principal and interest on a 30-year, fixed mortgage at the prevailing rates for a median-priced home in 2006 was nearly $905. The comparable payments to buy the median price home in Chattanooga with today’s lower rates and home prices would be under $691 a month.Source: Based upon 6.8 percent average rate for a 30-year mortgage in 2006 when the median home price was $153,000 compared with 4.15 percent, 30-year rate today for a median price home of $142,145.Apartment dwellers talk about why they rentResidents of Waterford Place, a Shallowford Road apartment complex, speak out on why they chose an apartment over a home.Casey LongPersonal: 26, single, sales and marketing.Status: Considered buying a home in 2009, but maintenance concerns steered him toward an apartment. He likes not worrying about fixing hot water heaters and air-conditioning units.Quote: “The main kicker was, when you get a home and you’re more obligated, you’re not as mobile as you want to be,” Long said. “With the economy being unstable, and if it bottoms out, you’re stuck with the house.”Outlook: Long would reconsider buying a home when he starts a family. “When you get kids and they start going to school, then you want to go ahead and do that,” he said.Meaghan JonesPersonal: 23, married, missionaryStatus: Shopped for homes, but couldn’t make the finances and location work. For less than a home payment, Meaghan and her husband, Stephen, were able to live in an apartment closer to work.Quote: “I wouldn’t say it was disappointing when we looked [for a home], but we felt like if this is all we can afford on our budget, this is pretty crappy,” she said. “Plus, we didn’t want to make that investment in a housing market where it’s so hard to sell.”Outlook: Jones said the 800-square-foot apartment can get cramped when entertaining more than two to three other couples, but since they plan to leave in a year to serve as missionaries in Asia, they aren’t too worried about the long-term outlook.Jean BainPersonal: 83, single, sold her old home in 2005.Status: She moved into an apartment complex as a temporary measure while she searched for a new house, and never moved out. She doesn’t miss the property taxes and insurance payments, which equal about four months of her current rent.Quote: “One day I didn’t have any hot water, but I knew it was the hot water heater, so I called up the office and within an hour I had a new hot water heater,” Bain said. “If it happened at my old house, I would have had to go buy a new water heater myself.”Outlook: Her rent, currently $660, is going up this year, and if it gets too high, she plans to move into a smaller apartment. But though she liked her house, she has no plans to move back.Julie BestryPersonal: 40s, single, works as a professional organizer in Chattanooga areaStatus: For many years, the former television program director moved from city to city, telling herself that one day she’d settle down in a small home. However, the convenience of apartment living has her hooked.Quote: “In terms of reducing any levels of stress that I have, it’s like living in a hotel,” Bestry said. “Yes I have to do my own dishes, but if anything goes wrong with the plumbing, help is a phone call away.”Outlook: As a single woman with few do-it-yourself impulses, Bestry has no desire to buy her own home.Apartment living by the numbers12,722 — Approximate number of planned and completed apartment units760 — Approximate number of vacancies6.5% — Vacancy rate$702 — Average rent$43 — Average increase in rent from 2010Source: Real Data Apartment Market Research, news archivesHome buying by the numbers2,739 — Home sales, first half of 2011$425 million — Value of homes sold, first half of 2011139 — Average days on market, first half of 2011$124,400 — Median sale price for new and existing homes, first half of 2011Source: Greater Chattanooga Association of RealtorsApartment additionsNew and planned apartments being developed in the Chattanooga area will boost the number of rental units this year by more than 15 percent.Year Total Dwellings Vacant Units Average Rent Average Square Footage2007 10,183 392 $663 9712008 10,487 725 $658 9582009 11,088 1,104 $661 9612010 10,983 845 $659 9692011 12,722* 760 $702 964 through January 2011, unless otherwise indicated*includes units currently under constructionSource: Real Data Apartment Market ResearchArea homes sale dropDespite an uptick in sales last year, the number of Realtor-assisted sales of single-family homes in Chattanooga in 2010 was still 19 percent below the level three years earlier before the recession hit. Median home prices have dropped nearly 8 percent since 2007.Year Homes sold Total sales Days on market Median sale price2007 7,315 $1.2 billion 112 $138,8122008 6,173 $1.04 billion 123 $136,0002009 5,678 $879 million 128 $129,2342010 5,926 $909 million 129 $127,900Source: Greater Chattanooga Association of RealtorsRise in rentalsUnder development:Little Debbie Parkway complex — 280 unitsApison Pike complex — 248 unitsConcord Road complex — 150 unitsFort Oglethorpe complex in the Lakeshore Cove subdivision — 322 unitsCity Green — 282 unitsHayden Place — 267 unitsThe Constance — 24 unitsRecently CompletedAmberleigh Ridge Apartments at Panorama — 315Lakeshore Cove Apartments, Fort Oglethorpe — 322Total — 1,888 new unitsSource: News archivesHome starts declineHome builders started only about one fourth as many single-family houses last year as they did five years ago.Year No. of home starts2005 — 4,4842006 — 3,9842007 — 2,9272008 — 1,7122009 — 1,3582010 — 1,2252011 (first six months) — 601Source: The Market EdgeFeds jump on rental bandwagon in a big wayThe Obama administration has announced a proposal to convert more than 250,000 homes owned by Fannie Mae, Freddie Mac and the Federal Housing Administration into rental properties, with another 850,000 homes waiting in the wings as they move through the various stages of foreclosure.Fannie and Freddie own or guarantee about half of the nation’s mortgages and almost all new mortgages, according to The Associated Press, and the housing downturn left them with a growing pile of delinquent mortgages.Officials have been working through the backlog of foreclosed homes, but the number is estimated to jump in coming months, the AP reported.The plan to convert the homes into rental properties could stabilize neighborhoods, argued Edward DeMarco, acting director of the Federal Housing Finance Agency, though the idea was attacked by others who fear that it could distort an already distended housing market.The deadline on the Obama administration’s request for information is Sept. 15.
With the family’s credit ruined, Leigh decided to look for a safe place to raise children with the perks of suburban living without the credit requirements. She turned to one of a half-dozen new luxury apartment complexes in Chattanooga that are targeted at a formerly reliable home-buying demographic.
The $1,265 per month she now pays in rent is only slightly less than her $1,500 mortgage payment, but there’s no hassle, no commitment and no upkeep.