Nationally there's a boom for apartments and Milwaukee is helping to lead the way.
Nationally there's a boom for apartments and Milwaukee is helping to lead the way. Back to the full article.
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Any thoughts on why the Milwaukee area has such low rates of home ownership? It’s really odd to be among some of the priciest cities in the country, especially considering the cost of area real estate. Are area wages or rates of saving really that low? Is our population unusually transient/unwilling to settle down here?
@Devin – That was definitely something that stood out to me as well. A bit beyond the scope of the article, so I had left it out for the time being.
I just went digging into the data and found that in 2005, Milwaukee ranked 22nd lowest in home ownership. All of the cities that have less than Milwaukee now had less than Milwaukee then. Without a really valid statistical validation (or other evidence), I would guess the metro area got hit pretty hard by the foreclosure crisis than others AND was already at a lower ownership rate.
Knowing that rentals are often denser than owner-occupied single family homes, I would suspect Milwuakee’s position as the 14th densest city in the country (by population-weighted density) is also a factor. Milwaukee might just have more rental style units per capita than other cities for a variety of historic reasons.
Without any stats to back me up, I think there are several reasons Milwaukee has a higher rental rate.
1) Duplexes. As noted on this site previously, Milwaukee has one of the highest duplex rates in the country.
2) Forclosures. Forclosures hit, and continue to hit, Milaaukee pretty hard wiping out a lot of home ownership that we did have.
3) Neighborhoods. A lot of neighborhoods in Mulwaukee are still struggling. Lots of new transplants (especially if they are young and/or white) look to live in the corridor from bay view to shore wood which is dominated by apartments and duplexes.
In addition to what Michael (#3) said, I’d add that Milwaukee also has a pretty decent stock of studio apartments (the small and inexpensive ones, not just the expensive ones) compared to a lot of cities. These are important rental options for students, younger folks, and single people with lower incomes. Many southern and western cities do not have as many studios because they’re more common in older, denser cities.
Also, if I recall correctly, Milwaukee has a relatively high level of college students in its population. There are lots and lots of UWM and Marquette renters, in addition to those from the smaller schools. I don’t think those numbers are quite so high per capita in some other large cities. Take Oklahoma City, San Antonio, Charlotte, Jacksonville, Kansas City, Albuquerque, Phoenix, Indianapolis for example.
Milwaukee has some of the highest property taxes in the country. Combine high taxes with low/flat growth in home prices for the past decade and renting tends to be the better option financially [0]. This would explain Milwaukee’s relatively low rate.
[0]: http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html?_r=0