Yes, apartment rents are on the rise. But it’s becoming a renter’s market across many U.S. metro areas, where landlords are expecting more supply.
Rents rose 2.9 percent in the third quarter, versus a year earlier, the Wall Sreet Journal reported. That’s also an increase from 2.5 percent in the second quarter. The boost comes from factors including a weaker sales market — tight supply nationally has driven up prices — and a strong economy that’s spurred more demand.
“There definitely doesn’t seem to be the pressure to buy that was there a little bit earlier,” Greg Willett, chief economist at RealPage, told the Journal.
The share of occupied apartments during the third quarter climbed to 95.8 percent from 95.4 percent in the second quarter, the report said.
Sun Belt cities have seen the most growth, with Las Vegas and Orlando seeing rents push up by 6.6 percent and 6.5 percent, respectively. Tampa also saw a 4.9 percent uptick.
Meanwhile, the markets that were once most desired by developers — New York, Seattle and Portland — are now feeling the impact of oversupply. Those three markets each saw 1.7 percent in rent growth. Chicago saw 1.3 percent.
The rental market in Manhattan specifically remains sluggish. The median net effective rent in August was down 2 percent year-over-year. Prices in the luxury segment dipped 3.8 percent. [WSJ] — Meenal Vamburkar