The rental market, in the United States is heating up again with rents increasing at a pace. This surge can be attributed to factors, including demand from renters, a scarcity of available rental units, and the impact of inflation.
Rapid Rise in Rental Prices
As per the data provided by Apartment List, the median rent for a two-bedroom apartment reached $1,941 in October marking a 6.3% increase compared to the same month last year. This uptick represents the rate of rent growth observed since 2014.
The surge in rents can be primarily attributed to demand from renters. The number of individuals opting for renting has been steadily increasing across the United States for years now. This trend is expected to persist. Factors contributing to this include population growth, rising incomes, and a preference for renting than owning property.
Simultaneously there is availability when it comes to units. Several factors contribute to this situation such as decreased construction activity, an upswing in short-term rentals like Airbnb accommodations, and conversions of units into condominiums.
The combination of demand and limited supply is placing pressure on rents. This trend will likely continue in the future.
Rising inflation is also contributing to the increase, in rent prices. In October the Consumer Price Index (CPI) which measures the price change of goods and services for consumers rose by 6.2%. This marks the inflation rate in 31 years.
Landlords are feeling the pressure of rising inflation as they face expenses for labor, materials, and maintenance. Consequently, they are passing these costs onto renters through rates.
Looking ahead it is expected that the rental market will continue to be competitive and rents are likely to keep increasing. However, as inflation starts to stabilize in the months the pace of rent growth may slow down.
Real estate professionals can provide assistance to both renters and landlords during this rental market period. Consider these tips;
Take your time to explore options; Don’t settle for the first apartment you come across. Compare prices and amenities to find the deal.
Be prepared for higher costs; Due to rising rents, it’s important to be financially ready to pay more, than what you might have paid in previous years.
To increase your chances of qualifying for an apartment and securing a lease it’s important to have a credit score. Landlords are placing emphasis on credit scores nowadays. Additionally having a credit score can help you obtain an interest rate, on your lease.
Below are some tips for landlords;
- Set the price; Conduct thorough research to ensure that you’re charging an appropriate and competitive rent amount.
- Be discerning when selecting tenants; Carefully screen tenants to ensure they meet the qualifications and are a good fit for your property.
- Maintain your property; Keep your property in condition to attract and retain tenants effectively. If you’re aiming to thrive in the real estate industry consider working with a real estate coach or mentor. They can provide guidance and support throughout your journey. A real estate coach will offer their expertise and insights while a mentor can share their experience and knowledge to help you achieve success.
Here are some advantages of engaging in real estate coaching or mentorship;
1. Gain insights; Learn from professionals who possess extensive knowledge and can provide valuable insights into the industry.
2. Develop skills; Receive the training and support required to develop crucial skills needed for success in this field.
3. Accomplish your goals; Obtain the assistance required to set goals and work, towards achieving them in the realm of estate.
In conclusion, the rental market is constantly. Requires real estate professionals to stay informed, about the trends in order to offer valuable services to their clients. By doing they can position themselves for success, in this industry.