When someone says the Kokomo housing market is “affordable,” that’s not always a good thing.
It’s a positive for median income homebuyers, who can afford a higher percentage of the homes for sale than in almost any other market in the nation.
But it’s less of a positive for home sellers and for landlords, who haven’t been able to raise rents for years.
The affordability tag is also a reflection of the city’s aging housing stock. With doubtful return on private real estate investment, there hasn’t been much of anything built for the past five years.
And in the years leading up to the 2008 collapse, most of the new apartment construction was subsidized through federal tax credits, adding a further layer of control on rents.
Local property manager Chris Mullinax of CRM Properties, said the rental market suffers from a basic lack of higher-end units.
He recently rented out a three-bedroom home near the Chippendale subdivision for $1,600 a month, and said three families were vying for it the day it went on the market.
“But the next level we have is probably something similar to what you’d see in Indian Heights, down around the $700 a month range,” Mullinax said. “There’s a market for higher-priced rentals, based on calls we get for nicer properties.”
That’s what an Ohio firm is banking on.
Developers Redwood Management are proposing to build 100 “luxury” rental units on a 36-acre parcel on Kokomo’s southwest side.
It’s a prime area, where $300,000 homes alternate with undeveloped, golf course-frontage lots. The parcel Redwood wants was once slated for an expansion of the Wildcat Creek golf course.
The big question is whether the project can command the rent level publicly quoted by their real estate broker.