Rising rents could spark more buyers
WASHINGTON – April 14, 2011 – Apartment bargains once dominated the housing market, but those bargains have slowly faded away. As vacancies decrease and rents rise, renters are finding fewer deals.
Analysts expect vacancies to decrease even more and rents to continue to rise through 2013 as the economy continues to improve.
In 2011, rental activity recorded its best start for the year since 1999, according to Reis Inc. Vacancy rates have fallen to mid-2008 levels and rents have increased for the past five quarters, now averaging $991 per month nationwide.
Renters are finding the fewest deals near the coasts, such as in New York, Washington, D.C., Boston, Los Angeles, San Francisco, Seattle and San Jose, Calif., that have low vacancy rates. Also, a boost in these cities’ economies is sending rents higher. New York City alone has seen double rent increases compared to the national average and has the lowest vacancy rate in the nation.
The best rental deals can be found in Las Vegas, Tucson, Ariz., Phoenix, and several cities in Florida – all areas where unemployment and foreclosures remain high. According to Reis, Las Vegas was the only city to see rents fall last year. In Florida, Orlando and Jacksonville made CNN’s list of top six cities where it makes more sense to buy than to rent.
However, analysts say that bargains across the country are getting fewer, and renters should expect to see an increase in rents over the next three years.
Source: “Rental Market Swings Back in Favor of Landlords,” MSNBC.com (April 12, 2011)