Rentals on the rise

The slowdown in real estate has stimulated the rental market for both renters and rentees.

Property managers said they are seeing more applicants seeking rental housing and more homeowners opening up their homes to renters.

"We've definitely seen a lot of people who are renting out their house because they can't sell it," said Jennifer Crane, owner of Crane Property Management.

The majority of homeowners in that category were trying to sell their homes for reasons of necessity, such as accepting a job in another city or moving into a nursing home, Crane said. Some had tried to sell for as long as 10 months before opting to rent.

Homes for sale in Ashland had been on the market an average of 152 days as of Friday, according to Colin Mullane, the chairman of the Southern Oregon Multiple Listing Service Statistics Committee and a broker with Re/Max Realty Group in Ashland.

The average wait for a sale has been steadily climbing. In the first six months of 2007, existing Ashland homes were on the market an average of 98 days before they sold. For the same time period this year, that number jumped to 113.

Beating those trends was cause for celebration for former Ashland schoolteacher Julie Romberg, who sold her home Thursday after it was on the market for two months. She is going into the Peace Corps in September and was considering renting out her home if she could not sell it in time.

"It's a relief," she said. "I know that a lot of places are still on the market. I'm feeling very lucky."

Having the sale behind her will make it easier to relocate to Portland when she returns to the U.S. two years from now, she said.

The high end

Higher-end homes are also popping up in the rental market much more often than before.

That could be because it is harder than ever to qualify for "jumbo loans" of more than $417,000, which have a different set of criteria and higher interest rates than smaller loans, Mullane said. Of the 302 existing homes on the market in Ashland, 180 of them are listed at $420,000 or above, he added.

"The only part of the market that is moving is the lower part of the market," he said.

Renting out a home, especially at the high end of the market, is not the windfall it may seem. A $1 million home may only fetch $2,500 per month in rent payments, not nearly enough to cover a $6,000 monthly mortgage payment, Mullane said.

With those margins, more people are also looking to rent homes and can get more for their money, said Everett Eichler, owner of Classic Property Management.

While the bulk of Eichler's renters are college students and retirees, an increasing number of his clients are coming from home ownership and are more selective about the properties they are willing to rent and how much they are willing to pay for them, he said.

"A lot of times people will say, 'Well, gee, I'm just paying somebody's mortgage,' but you're paying far less in rent than what it would be in mortgage payments, and you don't have to do upkeep," he said.

Rent before buying

Although the rental market has expanded, there are actually fewer vacancies because more people are looking to rent, Crane said. In some weeks, her company rents out half of its properties before they are advertised.

Part of that is due to an increase of people who could buy a home choosing to rent instead, Crane said.

"We have a lot of applicants who have the financial means to buy, but they don't want to buy right now because of the market so they're choosing to rent for a year, which I do think is different than the past," she said.

For buyers, renting can be an attractive short-term alternative, giving them more time to find the perfect house, Crane said.

Melanie Wilkinson, the branch manager at Bank of the Cascades, decided to rent a condominium when she moved to Ashland from Boise, Idaho, to buy herself time to find her ideal house.

"Maybe within a year, year and a half, I will be looking at purchasing," she said. "The economy &

as far as I'm concerned in terms of buying a house &

now is the time because the rates are still good and there are more homes on the market."

Renting first gave her time to get to know Ashland and figure out what part of town she would like to live in. Living in a condo also led her to consider buying one, expanding her options, she said.

"I think that real estate will always be a good investment, but you have to go in at the right time," she said. "Buying real estate should never be an impulse purchase. It's not like buying a pair of shoes."

Staff writer can be reached at 482-3456 ext. 227 or .

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