The construction of a record number of new apartments in downtown Madison and the emergence of what some city officials are calling a “renter’s market” has many University of Wisconsin students anxious to feel the effects of lowered rent prices and an improvement in landlord services.
“The bottom line is that students are enjoying a much more favorable housing market,” City Council President Mike Verveer said.
Palisade Apartments, Lakelawn Place and Park Terrace West are all high-rise apartment buildings that have opened in the past two years, and The Aberdeen and 420 W. Gorham are similar apartment buildings that are scheduled to open in the fall of 2004. The construction of such apartments has increased the amount of housing available in downtown Madison, a housing market so tight in previous years that landlords have been able to dictate high rent prices and provide a minimal quality of services.
Now, however, the rental market may be slightly in tenants’ favor.
“Our prices have gone up with inflation, but it’s nothing like it used to be,” Ed Tallard, one of the owners of Tallard Apartments, said. “Some have gone down a little, and it has definitely been leveling off over the last few years.”
Verveer said reports from Madison Gas and Electric Company and anecdotal evidence he’s heard from landlords have indicated that a record number of rental properties remained vacant this year. Yet many apartment management companies continue to construct new apartment buildings because of alluring record-low interest rates on mortgages.
“They make the decision to go ahead and build anyways, knowing it’s more of a renter’s market, in order to take advantage of the low interest rates,” Verveer said, adding that builders know they likely won’t be able to get top-dollar rent when they first open their doors like they have in previous years.
In spite of a downtown housing market in tenants’ favor, many UW students say they have not seen lower rent prices or an increase in services from their landlord.
Allison Bichler and Katie Brown, both UW juniors, live in an apartment on Fahrenbrook Court owned by JSM Properties. Although they decided to stay in their apartment for another year, their rent will increase $50 per month.
“I think the landlords have the upper hand,” Brown said. “I feel like you’re at the mercy of what you can find.”
Bichler agreed, noting that rent near campus is still very expensive.
“Compared to students in other cities, we’re paying an arm and a leg,” Bichler said.
Other students say they are feeling the effects of a slow change in the market.
“My rent is going to stay the same price next year, which I was really happy about,” Lyndie Paquette, a UW junior who rents an apartment from Randall Court Investments, said. “That was actually one of the reasons why we decided to stay in this apartment again next year.”
Verveer said even with rent prices stabilizing, it is still very expensive to live in downtown Madison.
“I’m in no way arguing that rents are reasonable in this area. Rent is still high for what you get. I wish I could argue that rent is affordable on campus, but I can’t,” Verveer said.
Like Tallard Apartments, Madison Property Management is keeping its prices fairly stable with slight increases, according to Michael Greiber, corporate counsel for Madison Property Management. Madison Property Management owns more than 100 buildings downtown.
However, a representative from a rental company that owns more than 30 buildings downtown said “most” of the rent prices for their properties had been increased, with price increases ranging from $25 to $90 per month.
Both Madison Property Management and Tallard Apartments report a strong rental market so far this year. Tallard Apartments, which used to start showing its properties in January, began showing apartments in December this year because of the heavy volume of calls they received prior to January. Tallard said the shift in the apartment market has not affected his company so far.
“I think it’s affecting landlords who didn’t keep their places up, as well as affecting places located farther from campus,” Tallard said.
The current renter’s market may also lead to improved services from landlords. There has been concern in recent years about the level of services students receive from landlords. Verveer said a market favoring tenants will force landlords to take better care of their properties and invest some money in them.
“Landlords are really going to have to stay on their toes,” Verveer said.
