Dickinson rental prices and occupancy in free fall
DICKINSON, N.D. -- Rental prices in Dickinson are the lowest they’ve been since the oil industry planted stakes here, but people aren’t flocking to fill up rental properties.
While residents might be excited about the cheaper prices, property companies are having a difficult time renting out units and houses that once had a waiting list.
Amber Lengyel, who manages the Dickinson Meadows apartment complex and oversees multiple properties in the city, said it’s an unstable market.
“When we opened (Dickinson Meadows) in October of 2014 we were renting at the $2,500 to $3,300 range and now we are over half that cheaper,” she said.
Dickinson Meadows currently has 63 percent occupancy rate and the other properties Lengyel oversees aren’t doing so well either.
Dickinson Place Townhome, a low-income housing complex, used to have a waiting list, Lengyel said. Now there are vacancies that can’t be filled.
“When I first moved here three years ago at Dickinson Place Townhomes … I had a wait list a mile long,” she said. “Now at that property we have something like eight vacancies and nobody on a wait list, and it’s incredibly hard to fill because market rent and low income are competing. So why would anyone want to jump through the hoops of having to do all of the paperwork with low income and you know all of the rules when they can honestly go get a nicer, if not as nice, place where it literally takes a half hour to sign a lease to move in?”
Northern Place, an affordable housing apartment building under construction, will also be overseen by Lengyel. The 36-unit complex will be priced cheaper than the other affordable housing options, she said.
“It’s going to be a challenge,” Lengyel said about filling the units.
Alex Burkhalter, founder of Housing Solutions, the company behind Northern Place, previously said while the economy has slowed down, it’s still important to have the affordable housing option in Dickinson.
“Our believe, as well as the (North Dakota Housing Finance Agency), was that this was a needed project for Dickinson,” he said.
Realtor Diana Zietz of Continental Real Estate said the firm has an estimated 190 rentals with 30 percent vacancy.
The U.S. Census Bureau states that the average rental vacancy rate for the nation is 7 percent while the Midwest sits at 7.7 percent vacancy.
Zietz said the problem Dickinson has right now is an abundance of rental properties.
“When people were moving into the area, those buildings were starting to fill up even at the higher prices,” she said. “Now that people have vacated, there is an abundance of properties and we haven’t seen that in the past. This is probably the worst that I have seen it.”
Zietz said even with the lower rental prices, there are those who still aren’t able to afford it.
“The troubles that we are having right now are people have limited income, they’ve had cut wages and or no jobs so when they apply for a rental application, you know, they have to have enough money to pay for the rent even with the lower rents,” she said.
She said she would guess that one out of every three or four people qualify for a rental because of loss of jobs or credit scores.
“It makes it real difficult,” she said.
Lengyel said there was more troubles with renters at the height of the boom whereas now it seems like most of those people have left.
“Now you’ve got the more responsible people and the better tenants that you would want to rent to in the first place,” she said.
Zietz said she doesn’t believe prices will keep dropping as rapidly as they have been and the market seems to be slowly getting back to a normal pace.
“It’s starting to stabilize somewhat,” she said. “The prices have stopped dropping as much as they were or have slowed down on dropping on prices. They are more affordable for renters right now.”
Zietz said Continental currently has a one-bedroom, one-bathroom unit that rents for $450 a month and a two-bedroom, one-bath townhome with a garage for $850.
“I would hope to find a happy medium, not where we are right and not where we were a year or two years ago but somewhere in between,” Lengyel said.