Back on October 14, 2013, the Missoulian ran a story called “New housing developments on Russell Street could reduce rental rates.” Since then there’s been no reporting on the new apartments, a fact I’ve found strange, especially since many drivers are going by each morning, afternoon, and evening wondering what’s going on.
What’s more, I’ve heard KGVO News Talk mention the lack of information out there on this while driving by those same apartments in the morning!
Something tells me something funny is going on, mainly because it seems so hush-hush. So who’s profiting? Certainly not renters – the Missoulian article makes it clear that the going rate for these new apartments will be $840 a month.
I guess in that case I should just shut the hell up and get in my place, huh? I pay $665 for a two-bedroom apartment, and even though its tough getting by on two poverty-level incomes, we manage. And it might be more in-line with actual market averages in Missoula.
I can’t imagine what a person making minimum wage ($7.90) must be going through in Missoula if they want a two-bedroom apartment…and that’s why I made some charts:
I should be looking at the $3.5 million the project is worth…to investors, Missoula top dogs, and of course as the contractors working on the site.
How Many Apartments Are In Missoula?
See, there’s two more building projects taking place along Russell Street and they have a combined value of $19.5 million. Throw in these new digs on the corner with Mount and the whole kit and caboodle comes in at a cool $25 million.
Those 3 projects will hold 344 apartment units, which – if going at the fair market value of $840/month – would bring in $288,960 a month, or $3.4 million a year. In 20 years you’ve got $69.3 million – a helluva lot more than it cost to build those places.
In 2013 there were 33,491 apartments in Missoula and according to a Missoulian article this past April, there were more than 9,600 two-bedroom apartments.
Let’s do some more math. If you’ve got 9,600 units at $840 a month you’re pulling in $8 million a month, $96.7 million a year, and $1.93 billion over 20 years. Folks, this is a big industry.
See, after a certain amount of time that all becomes profit. Sure, there’s some maintenance and upkeep hassles, but that’s so miniscule that it’s not worth complaining about. I mean, really, does it make you forgo that Hawaiian vacation each winter?
Now we’re getting into the realm of the landlords, many of whom are not happy in Missoula. Another 344 units means that they might feel pressure to lower their current rates closer to that fair market value, or perhaps – God forbid! – under it.
Oh, and hear them gnash their teeth and howl when the idea of subsidized housing comes into it – as if you wouldn’t need a subsidy to be paying some of these rents in the first place.
What About Vacancy Rates?
It’s that vacancy rate that they’re really worried about, something that was pegged at 4.3% last September, meaning that there’s that many available apartments in Missoula at any given time. If that doubled then the idea is that the rents would go down, but anyone in Missoula knows that’s rubbish. We have to sign one-year leases – no rents are going down. It might mean once a year when tenants change the landlords will have to get up and do some work, but that’s about it.
The Building Associations
That’s troubling, that banks can just come in and scoop that up. I think a lot of it leads back to the Montana Building Industry Association and what pull they may have in Helena with the governor and the legislature. I’m pretty sure they’re not concerned about hardworking and struggling two-bedroom renters in Missoula, that’s for sure.
They have a local branch here in Missoula, the Missoula Building Industry Association. Now, you remember those financial numbers from above, right? How much you wanna bet this is a powerful group of people in Missoula that gets their way and probably can pull the strings of local government officials? I bet most stay in power longer than the officials. (Membership is only $495 a year)
Fair Market Value in Missoula
That’s what’s so silly – if you’re a city fat cat in Missoula like Engen and his cronies, then that means you can sue people instead of just having a hissy-fit on the street like you or I would be forced to do. Engen can waste money to get his way, but if I point out that $840 a month is in no way fair with my wages – and hell in a handbag, there’s no HUD housing! – then what recourse to the law do I have?
Maybe $300 an hour down there at Dewey, Cheatem, and Howe, but I’m not expecting a whole lot else. In other words, if you’re poor in Missoula, you should be used to getting screwed by now and the idea that you’d even speak up about it is such idiocy on your part that you should probably be taken to the City Detention Center, or what we used to call a jail.
Don’t ever forget that Anaconda Company in 1917-18 forced the legislature to pass the Alien Sedition laws in Montana – the first in the nation during WWI – to stamp out what it considered ‘unwanted talk’ concerning its operations. There’s strong precedence for the stamping-out of those that want to speak, and when the city has but one newspaper – the Missoulian, controlled by corporations and pretty much in bed with the city administration – haven’t they done so already?
When there’s no reporting on the issues that you drive by each day, what are you to think, who are you to turn to, where will the answers to your questions come from?
Maybe they’re not supposed to come, simple as that. I can’t help but think that’s the case when I drive by those new apartments on Russell and Mount in Missoula.
Here's what the new Mount and Russell apartment-area used to look like: