KNOXVILLE, Tenn. (WATE) – “This is not a unique situation to Knoxville or the Knoxville area, it’s happening all over the country,” Boyd Center for Business and Economic Research director Bill Fox said.
Fox says what happened during the recession, more than a decade ago, there are more houses being built, it’s just the type and rate at which they’re going up, as the population grows.
“But the really key change was that since the Great Recession financial institutions have been less willing to loan money, a lot of people who used to build homes got out of the industry during the recession and so we’ve seen many fewer houses, both individual houses and apartments, and condos, many fewer being built than we would have expected,” said Fox.
According to the latest data provided by the City of Knoxville, the average cost of a one-bedroom apartment costs $840. In order to afford that, one would need to make $16 an hour, working 40-hours per week.
However if you only make the state’s minimum wage of $7.25 per hour you would need to work 89 hours a week.
“So it’s not surprising that the prices are going up, I mean there’s inflation in the economy, it’s running about two percent a year,” Fox said.
Fox says the most recent data collected shows at least one in five people in the Knoxville area spend at least of half their income on housing.
According to the U.S. Department of Housing and Urban Development, it’s considered affordable if you’re spending less than 30% of your income on housing.
Experts say that is where landlords can hike up rent prices because they know the demand is greater than the supply.
“It’s clear that the millennial population and those following it up, Gen Z and so forth, have not responded as quickly in terms of getting married, in terms of having children …” Fox said. “Birth rates, for example, are incredibly low in the U.S. even in the last decade they have plummeted and so what we’re having is a lot more single people or couples looking for places to live where one-bedroom apartments might be a norm for these folks and clearly the market hasn’t responded.”
The City of Knoxville’s Community Development is looking for residents’ input on its next five-year plan and wants the community’s input on what they feel will best serve the city’s housing needs in the future.
If you want to voice your concern you can do so by taking an online survey through Oct. 6, or at a community meeting. Two more meetings are scheduled: from 5:30-7 p.m. Sept. 25, and 10:30 a.m. to noon Sept. 26. Both meeetings will be held at the O’Connor Center, 611 Winona St.