Taking advantage of an increase in homeowners turned tenants, apartment landlords are raising their rents and expect to continue to do so.
During the first quarter, monthly apartment asking rents increased 2.2
percent year-over-year, reaching an average of $1,070, according to
Reis, a property research firm.
Vacancies are at lows and developers are trying to rush projects of
multifamily housing to meet the increased demand from renters, but
continued constraints on lending has put the brakes on many projects,
particularly in smaller markets.
“I’m optimistic about the multifamily sector, certainly for the next two
years,” Kevin Thorpe, chief economist at Cassidy Turley, a commercial
property brokerage, told Investor’s Business Daily. “We’ve entered a
period of sustained rent growth.
The reason behind analysts’ optimism: Young professionals are
increasingly turning to renting and more than 3 million former
homeowners, who have been displaced by foreclosures or short sales, are
turning into renters.
Demand for single-family home rentals is increasing too, according to
CoreLogic. A four-month supply of single-family homes is now available
for rent, which is down from five months a year ago, according to