Julie Kumfer takes a no-frills approach to housing.
The 51-year-old housekeeper lives in a modest one-bedroom apartment in the Wells Street corridor of Fort Wayne. There are no swimming pools, tennis courts, tanning booths or state-of-the-art workout equipment.
What Kumfer does have is a $450 monthly rent payment.
Some of the places can be really expensive, she said. If you want all of the amenities, you have to pay for it. I can afford what I have.
Over the past three years, more than half of adults nationwide have had to make at least one sacrifice to cover their rent or mortgage, according to a MacArthur Foundation study.
The Chicago philanthropic organization this month said some people have taken on additional work, put off saving for retirement or moved to a less safe neighborhood to keep a roof over their heads.
The MacArthur Foundation found many renters and homeowners spend more than 30 percent of their income on housing – an established benchmark for financial distress.
Housing affordability might be especially bleak for renters, however. U.S. Housing and Urban Development Secretary Shaun Donovan late last year said, We are in the midst of the worst rental affordability crisis that this country has known.
Many experts, including those at the Joint Center for Housing Studies of Harvard University, point to the recession, the housing crisis that plagued the country after 2008 and shrinking household incomes as reasons.
Tighter lending standards, credit problems related to the economic downturn and other issues have more Americans turning to the rental market. Harvard researchers said U.S. households paying rent climbed to 35 percent in 2012, compared with 31 percent in 2004.
There are 43 million rental households in America. The National Apartment Association reports the rental industry annually generates more than $325 billion.
Beth Wyatt is executive director of the Apartment Association of Fort Wayne. She said the region’s variety of rental options and history of affordable housing still make it an attractive place to live.
Over the past month Wyatt has fielded several calls from Chicago-area residents about Fort Wayne’s offerings.
I’m not sure what it is, but we’ve seen more requests for information, Wyatt said. They’re looking for income-based and affordable housing. We have such a diverse mix of rentals from luxury to mid-range.
Even so, affordability is becoming more difficult in Allen County, based on Census figures.
In 2012, the median monthly rent was $654, compared with $506 in 2000.
Homeowners also saw the median mortgage payment rise to $1,068 from $830 during the same period. The Census averages all mortgage payments and doesn’t specify the length of the loans.
The housing collapse exposed the potential risks of the American Dream, including plunging home values, the high costs of relocating, and the financial and personal havoc caused by foreclosure, Harvard University researchers said. They credit those risks for helping grow rental demand.
The situation has created a renewed appreciation for renting, which offers greater ease of moving, the ability to choose housing that better fits the family budget, and no responsibility for home maintenance, the researchers said.
The trend has Jim Frey confident his Beachwood, Ohio, company is making the right decision to build condo-like rentals in Fort Wayne.
Frey is senior vice president of land acquisition and entitlement for Redwood Acquisition, which is building Maplecrest Luxury Apartments, a 95-unit complex on the city’s northeast side.
The rentals come with two bedrooms, a den, two full baths and a two-car garage. At least three similar developments are on tap as well.
We have quite a few pre-leased, Frey said. A lot of people saw their homes lose value during the recession and don’t want that to happen again. It created a market.
Jim Calkins agrees.
The businessman owns several rental properties in Fort Wayne, including Coventry Court West, Fairview Court and Candlelite apartments.
He recently bought four homes along Getz Road near Covington Road. He plans to rent the houses.
We’ll see what the market can bear, he said, adding that monthly rent could range from $900 to $1,200.
They’re being renovated now, he added.
Kumfer, who lives on Wells Street, says such rentals are out of her range.
What some of these places are asking for rent is as much as paying a mortgage, she said. I don’t know how people can afford it.