Cinda Bates and her son, Tim Bates, have a story that is very similar to thousands of other homeowners — now renters — in Kane County and around the country.
Cinda inherited an Elgin home in 1986, then lost it to foreclosure in 2009. Since then, she and Tim have lived in five rental units in Elgin and Belvidere. Some of those lasted just a few months, and two lasted for two years.
After the housing market crashed around 2007, homeownership declined. Many former owners were forced to rent and others became reluctant to purchase homes.
Cinda and Tim received notice in mid-June that the lease on their latest rental, on Elgin’s near west side, would not be renewed and they have until July 31 to find a new place to live.
Cinda scours Craigslist for apartment postings and says she does not remember a time when it was this hard to find an apartment here.
They’re not alone, local experts say.
“During the housing market downturn you saw a lot of foreclosures that put a lot of homeowners in a position where they need to rent homes now,” said Scott Parker, sales manager of John Greene Realtor in Naperville.
The recession and housing market crash caused a lack of jobs, slow income growth and student debt, which made renting a more viable option for many.
That increased the demand, putting more pressure on the supply of good rental housing throughout the Naperville, Aurora, Elgin and other Fox Valley communities.
Net rent per square foot increased by 7.6 percent in Kane County in the last two years and 8.5 percent in the Naperville and Aurora submarket, said Ron Devries, vice president of Appraisal Research Counselors. It’s also harder to find an apartment. Aurora and Naperville have an apartment occupancy rate of 97.1 percent.
Naperville had approximately 11,673 rental occupied units in 2013, according to the U.S. Census Bureau. The majority of those were multi-family units.
“I’ve never seen a landlord market like it is right now,” said Ed Kettley Jr., manager of Kettley Realtors. “I feel bad for those looking to rent. It is tough, and the rents are high.”
Kettley said he has seen rental rates increase by about 20 percent over the last three years. Because of tough competition and high rental rates, Kettley said that in places such as Aurora and other areas of the Fox Valley, buying might be a better option than renting for those who can.
“We’re looking at a limited amount of supply that’s been added to those markets,” Devries said. “And as the economy continues on the current path, we expect rents to keep moving up.”
The changes also have affected Yorkville’s housing market.
From 2009 to 2013, Yorkville has seen a 7-percent increase in the number of rental units, according to the 5-year American Community Survey by the U.S. Census Bureau. Because Yorkville has not added any new apartment complexes, the growth of rental units comes from homes being turned into rentals, said Krysti Barksdale-Noble, community development director of Yorkville.
“I don’t know if renting is a better option, especially since the rent has gone up, but I think it is their only option,” Barksdale-Noble said. The community saw 759 foreclosures in about six months in 2010.
According to Jim Pilmer, director of neighborhood standards in Aurora, the biggest change in the housing market lately is large corporations buying single-family homes as investments and turning them into rentals.
Those companies include Waypoint Homes, which owns 103 properties in Aurora, and American Homes 4 Rent, which owns 109 properties, Pilmer said.
“They severely limited the options that buyers had, forcing a lot of would-be buyers to rent,” said Andrew W. Stoll, owner of A. Will Properties, LLC, in an email.
In Aurora, which has 8,097 residential rental licenses, single-family homes account for almost 66 percent of the rentals. The city began licensing single-family homes around 2005.
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According to Elgin Community Development Director Marc Mylott, the number of rental licenses in Elgin has jumped from 2,300 in 2009 to 4,700 so far this year.
“The city needs more housing units, particularly for seniors and for those who might prefer to rent or, because of costs, have to rent,” Elgin Mayor Dave Kaptain said.
A few years ago the 93-unit Fountain Square on the River and the 116 townhome River Park Place in downtown Elgin changed policies to allow owners to rent their condos and house. Since the change, both developments have almost been filled.
Kaptain said an apartment complex in Elgin has not been built in decades, but within the last 12 months, some developers have approached Elgin inquiring about possibly building one.
As the demand for rental units rise, so do rates.
That’s also an issue for Cinda and Tim. In absence of a full-time job, Cinda works three jobs to make ends meet. Tim recently had foot surgery but expects to go back to work full time once he is healed.
In the meantime, they are hoping to find a two-bedroom apartment for under $1,000 that will allow three cats and three birds. They’re not looking for something permanent, just hoping to find an apartment they can stay in for a while and get resettled in their lives.
Janelle Walker is a freelance reporter.