Apartment Rents are Suddenly Rising Faster
Rising Rents Spark Protests: More would-be buyers are being forced to continue renting as rising home prices push them out of the market, which, in turn, is heating up rental demand and prompting landlords to raise rents.
The growth rate in rents had been slowing for the past three years because builders focused on adding more rental inventory.
But the shortage in for-sale inventory is reversing the trend; in the third quarter of the year, rents rose 2.9 percent compared to a year ago, according to RealPage, a real estate data firm.
The cities seeing some of the biggest rent increases include Las Vegas; Orlando, Fla.; and Phoenix—all which saw rents jump between 6 percent and 7 percent over the past year. Rents are up more than 4 percent in Jacksonville, Fla.; San Jose, Calif.; Tampa, Fla.; Riverside, Calif.; Salt Lake City; and San Diego.
“Momentum in the apartment market’s performance during the third quarter slightly surpassed expectations.”
The apartment occupancy rate is at 95.8 percent. Apartment construction continues to pick up, with new multifamily starts up 37 percent annually in August, the U.S. Census Bureau reports. Many of these apartments are in the luxury sector.
“With so much high-end new product finishing in the near term, the leasing environment will be competitive in that luxury apartment niche,” Willett says. “At the same time, product shortages remain for moderately priced rental housing. It’s tough to find available apartments at the middle- to lower-end price points across most neighborhoods.”
Higher rent costs are prompting some tenants to take part in rent strikes, which are often seen as renters’ last option to not get priced out. During a rent strike, tenants withhold their rent checks in an attempt to pressure landlords to negotiate rents and typically to improve building maintenance, too. Tenants may need to brace for more rent hikes ahead. Many landlords say they plan to raise rents even more over the next few months.
Tried of renting? We know that Buying or selling a home can be a long, stressful process, so it’s imperative to make sure you have a good plan in place for each part of the process. This will help you keep everyone safe and happy and will reduce the risk of stress and anxiety.
Not quite ready to buy a home? You may qualify for the Lease with a Right to Purchase program. Call me CALL 801-809-9866 and I'll give you the details on how you may qualify to get into the home you want, get settled and then purchase it when you are ready!
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