Rents are rising across the country. NAR research shows rents have been rising at a progressively stronger rate in recent years and projects they will rise another 3.5 percent in 2012. Vacancy rates have been trending down gradually and currently rest at 5 percent and that percentage is expected to fall even further in 2012 as demands for rent increase. Historically, 5 percent is seen as a “landlord’s market.”
A decline in apartment vacancy rates is the driving force behind rising rents in the near future for many markets. The U.S. adds roughly 3 million people each year, but the pace of new housing construction has slowed to well below the 1.5 million needed to accommodate the normal rising population.
On the Up and Up Talk to a Realtor® about rental rates in your area and trends over the past year? Do they have any clients who are currently renting but are in the market to buy a home, and if so, what are their challenges? Talk to renters in your area for insights into how much of their monthly income is allocated to rent. Would they prefer to own a home rather than rent? Have they had to relocate to a different home because their landlord raised the rent?