By Mollie Bryant
About two weeks ago, Brandon Mischlich found a flyer on the door of his Knoxville, Tennessee townhouse. The flyer, distributed by a fellow renter, warned Tanglewood Apartments residents the complex’s new owners planned to almost double their rents.
Mischlich’s lease was set to end July 31, but he hadn’t received any notice about an updated lease or rent amount from the new owner, Rand Property Management, a real estate company based in Knoxville.
He visited the leasing office and learned the company planned to raise his rent from $815 to $1,560 per month. A property manager said rents at the complex were below the market rate, and Rand planned to add amenities like a dog park, gym and redo the sidewalks.
“I was like, ‘Why don’t you get all that done and then increase it when you have actually put the value in?’” said Mischlich, a Veteran who works for DoorDash.
Streetlight spoke with Mischlich and four other Tanglewood residents, who said they currently pay about $800 to $1,000 per month to rent two-bedroom townhouses. They said the leasing office told them their rent will go up to about $1,600 in their next leases.
Facing pressure from renters organizing around this issue, Rand has abandoned plans to immediately double rent for at least some of its Tanglewood residents. Rand didn’t respond to emails seeking comment.
Rand regional manager Shannon Uleski told residents that tenants with leases ending in July and August could sign new agreements at amounts closer to their original rents, Mischlich said. On Monday, he received a one-year lease offer for monthly rent of $930, including a new $25 fee for water service, he said.
Some states limit the percentage that landlords can raise rents, but in Tennessee, it’s legal for landlords to increase rents by any amount. A state law even bans cities from taking steps to regulate rent, including placing caps on rent increases.
And Tennessee law doesn’t require landlords to give renters advance notice of rent increases, either, said Emily Cala, staff attorney for Legal Aid of East Tennessee.
“Unfortunately, this property isn’t unique. This is happening all over,” she said. “We’ve seen a lot of places where people have lived for 15 to 20 years get bought, and then they can’t afford to live there anymore because of the rent increase.”
The strain from such housing disruptions is felt acutely in Knoxville, where affordable rental homes are tough to find.
The Knoxville metro area led the nation in rent growth last year, and since peaking at 99% in 2021, occupancy rates are still high. The city is investing in affordable housing, but that construction is losing a race against steeply rising rents.
All these factors are pushing some Knoxville renters in different directions—into financial strain, out of housing, toward homelessness, eviction court, or into neighborhoods further from their community and jobs.
Tanglewood sold for more than double the apartment’s appraised value (twice)
Tanglewood sold twice last month at prices that greatly exceeded its most recent county property appraisal.
According to Knox County’s property assessor, Tanglewood has an appraised value of about $3.2 million for the 2023 tax year.
On July 18, the complex sold for about $7.6 million to 4501 Tillery LLC. According to the Tennessee Secretary of State’s website, the LLC is connected to Chattanooga business owner Nick Ferrantino. His LinkedIn page and a Better Business Bureau profile say that Ferrantino owns real estate company KeyHomeOffer and is the founder of Low Key Investments. Sites for the companies say KeyHomeOffer buys properties and Low Key Investments sells single and multifamily homes to investors.
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On July 20, two days after buying the apartments, the LLC connected to Ferrantino sold Tanglewood to Rand Property Management for $10.5 million.
Some Tanglewood tenants whose leases end soon were frustrated by the short notice to make an important financial decision.
Last week, the apartment complex’s leasing office told Edith Hall the rent for the two-bedroom townhouse she shares with her daughter would increase from $800 per month to about $1,600 when her lease expires.
“I was a little bit shocked,” she said. “It’s an older complex. It’s not like it’s really new.”
Hall, a tutor for Knox County Schools and director of children’s ministries for Bookwalter United Methodist Church, said she can’t afford the new rent. She’s considering moving to another county, but that would place her and her daughter further from their jobs.
Tanglewood residents said many of their neighbors are older adults and people with disabilities living on fixed incomes. One renter worried: “They’re not going to be able to afford these price increases, and I seriously have no idea where they’re going to be able to go. … I just would really hate to see my retired neighbors on the streets. They don’t deserve that.”
Knoxville’s affordable housing construction isn’t keeping pace with the need
Nationally, renters have coped with inflated rents and a short supply of affordable places to live for years, particularly during the pandemic. Rents continue to rise and remain above pre-pandemic levels.
Last year, rents for multifamily housing in the Knoxville metro area rose 10%—the highest jump in the nation, according to a National Association of Realtors report.
Zillow and Apartment List estimate the median rent for a one-bedroom rental in Knoxville is about $1,200. Two-bedroom units usually cost about $1,500 to $1,700 per month, the sites say.
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Renters have few options but to pay higher rents, as Knoxville has few open rental units. Occupancy rates in the Knoxville area have been astronomical since 2019, settling at 97% last year, according to a Knoxville Area Association of Realtors report from May.
City spokesperson Eric Vreeland said that Mayor Indya Kincannon was unavailable for an interview. While noting that state law bans cities from regulating rents, he said that since 2020, more than 1,500 affordable housing units have become available in Knoxville. About 650 more affordable units are under construction, the city website says.
But those units aren’t enough to meet the need.
Cala said evictions due to not paying rent are affecting more middle-income renters. Low-income renters are having a much harder time finding places they can afford, and more people are seeking homes outside of Knox County, she added.
“People are sometimes signing leases that they actually can’t afford just to be able to get in somewhere, and they’re turning around and getting evicted from there,” Cala said.
At Tanglewood, residents have been circulating a petition asking Rand to phase out the rent increase over several years until the apartments reach the market rate for rent. The petition also asks Rand to give residents with leases ending July to October 60 days to find housing.
In Tennessee, Cala said, landlords can’t retaliate against renters for organizing.
“Obviously, if they don’t re-sign a lease, then they’re not a tenant and they can get evicted even if they are organizing,” she said. “If they want to try to make change, they could try to approach the management, organize and see what they can get done respectfully and if they’d be willing to talk to them about it.”
Connect with resources mentioned in this story
- Apply for services with Legal Aid of East Tennessee or learn how to volunteer
- Read Statewide Organizing for Community eMpowerment’s Knox County eviction defense guide
- Knoxville residents can dial 211 to connect with local housing support resources
Contact Streetlight editor Mollie Bryant at 405-990-0988 or bryant@streetlightnews.org. Follow her reporting by joining our newsletter.
Streetlight, previously BigIfTrue.org, is a nonprofit news site based in Oklahoma City. Our mission is to report stories that envision a more equitable world and energize our readers to improve their communities. Donate to support our work here.
