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Show The National Enterprise, August 17, 1977 Page fourteen Apartments Continued from page one When the vacancy rate reached .7 percent, he says, apartment owners figured the time was right to raise rents. Fitzpatrick verifies his inforrents by about 0 percent This was to last October. make up for increased costs, she explains. Generally, when this happens, many renters move a step down, to a cheaper apartment. The more expensive units suffer the 15-2- apartment house contractors, Prowswood still comprises only about 5 percent of the total market. (which include both materials and labor), rental rates must be high. But, in the Salt Lake ters here, historically low. Fitzpatrick describes the typical owners of a rental unit in the state as small. area, those rates have been When rental rates were hiked last year, renters reported some vacancy factor soon thereafter. But, they did not factor the vacancy say, last long, and the market has since absorbed the increase. Lee Van Dam, property manager for Prowswood Inc., says the company is building more multiple family dwellings this year than it did last year. But, he adds, the rents are higher in these new units. We are building apartment units this year in our Foxpoint portion of Old Farm, and the rent there is significantly higher than in our other units, Van Dam says. "Of course, there are more amenities, he adds. Citing indoor and outdoor swimming and tennis facilities and a country club atmosphere, Van Dam says the company figured how much it would cost to build apartments, and then figured what kind of amenities would have to be provided in order to charge that much rent. I think this year we could build as many units as we wanted to, and they would he said, saying be filled, demand for multiple family dwelling units has noticeably increased during the first half of this year. Van Dam describes Prowswood as the largest builder of multiple family most. The costs of maintaining apartments have multiplied significantly during the past year. According to the manager of one Victoria House apartment complex, maintenance costs have shot up from 20 percent of income last year to 42 percent his year. Rents have got to go higher, she says. At the same time main- tenance costs have shot up, .building costs have been on an upward swing, particularly in the western United States. According to figures reported by Architectural Record in July, average construction costs in the western part of the nation are rising 1.1 percent higher than those for the nation. During the last year, costs rose 8.9 percent in the country. In the western portion, they rose 9.8 percent. During the first three months of 1977, construction costs rose 5.2 percent in the country as a whole. In the western portion, they rose 6.0 percent. And in the Rocky Mountain states, the situation is worse than in the rest of the west, according to the magazine. In the mountain west, costs rose 11.3 percent be- - st tween March 1976 and March 1977. In the Mississippi and Western Central states, costs rose only 8.4 percent. In order to support these surging construction costs mation, saying apartment owners generally raised their dwellings in the state, building twice as many units as the second-largebuilder. But, he adds, there are so many at COMMERCIAL DISPLAY V, 364-078- There are no trendset- he DECOR & DESIGN STUDIO says. f Builders build on intuition, depending on the kind of financing they can get. Convention -- Trade shows exhibits -- Grand openings - Seasonal trims - Flags - Banners Pennants -- OUR JOB IS MAKING YOU LOOK GOOD! In the Apartment House Association, she says, 80 percent of the members own buildings with between two INVESTORS EARN 12 and eight units. Most are homeowners who rent a portion of their houses, she says. And thats why rents are so low. 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