-----Original Message----- From: David Brauer
The story is rising vacancy rates...but no falling prices, yet. Apparently, for a little while anyway, landlords are willing to tolerate a higher un-rented inventory rather than offer long-term rent breaks...they, like many investors, are betting the post-9/11 dip is shallow and quick. [TB] I've lived downtown for about 5 1/2 years. My personal experience has been rather flat rental rates. This year and last, I had a rent increase of between 1 and 2 percent, there was one year where I had no rent increase. Using the 30% of gross income standard, the place is easily affordable. What I have found is that additional amenities are being offered. 2 or 3 years ago we had computers put into the lounge located just off the laundry room. We have 4 computers with internet access and a good quality laser printer, copy and fax machine. Recently a continental breakfast was made available. As more properties become available (units are under construction just east of Loring Park on the old Mikolay property, the warehouse district has numerous additions) the downtown market will become even more competitive. I'm not sure that the same is true in all areas of town. Given the 14% population increase (1990-2000) in Loring Park, 21% increase in Downtown West and over 100% increase in North Loop, there has clearly been an increase in housing supply downtown. [D Brauer] Anyway, I need price data, not just vacancy data, to declare the crisis over. [TB] I think we need both sets of data. If we don't have availability we have a problem regardless of price. Not that many years ago, a lender would expect a 5% vacancy rate in evaluating the cash flow from a property to see if it would provide the cash to pay off the mortgage. A higher vacancy rate (higher than 1 or 2 percent) gives tenants a better chance of finding housing that is more appropriate for their needs. Unfortunately prices do not react to a softer market as fast as they react to a tight market. A seller of any product is more willing to try to increase prices (make more money on the same volume) than to lower prices (which may not increase volume). There is a wide array of people that need housing in Minneapolis. We don't want a city which only has housing for the very rich (who can afford it) and the very poor (for who it is subsidized). That middle 50% must have housing opportunities if this is to remain a dynamic city. Terrell Brown Loring Park _______________________________________ Minneapolis Issues Forum - A Civil City Civic Discussion - Mn E-Democracy Post messages to: [EMAIL PROTECTED] Subscribe, Unsubscribe, Digest option, and more: http://e-democracy.org/mpls
