Rental Prices Hit Record High in July 2015
Digested from “In Demand: Top Cities for Multi-Family Rentals”
Commercial Property Executive (8/24/15) Otet, Amalia
Rental prices rose 6.5 percent to a record high of $1,155 in July 2015. A major contributor was the growing population of renters.
A recent study explored population and rent growth from 2006 to 2013 in 11 major markets: Atlanta, Boston, Chicago, Dallas, Houston, Los Angeles, Miami, New York, Philadelphia, San Francisco and Washington, D.C. Each experienced an increase in renter population during that time. Atlanta had the smallest change, at 6.5 percent, while Philadelphia saw the greatest change, at 28.2 percent. These renter population changes also affected the share of the population living in rental households.
The study — conducted by New York University’s Furman Center and Capital One, in conjunction with data supplied by the American Community Survey — also noted a decrease in rental vacancy rates in all cities except Miami and Washington, D.C., which saw more supply come online during that time than did other cities. Despite that increased supply, however, Washington, D.C., saw the greatest increase in median rent — 21 percent, from $1,082 in 2006 to $1,307 in 2013.
Only three of the 11 cities saw median household income rise faster than the median gross rent, which means many renters are now paying a higher percent of their earnings for housing. In seven of the 11 cities, more than 25 percent of moderate-income renters are rent-burdened.