Today we have some rental news to share from our friends at Pierce-Eislen. If you’re an agent who also works with rentals, we’re sure you’ll find this interesting. And even if you never work with rentals, rent growth means that more people will be interested in discovering whether buying is a viable option for them this year. So it’s really a win-win!
National rent growth to push towards 4.5% in 2015; Western markets lead the pack
The 2015 Rent Forecast & Outlook Report for the US multifamily sector published by Pierce-Eislen noted that estimated rent growth in 2015 is still strong, expected to grow by 4.5% nationwide.
Although the forecasted rent growth will decelerate from last year’s average of 5.9%, it still represents faster rent growth than in recent years. “Technology-heavy Western markets with restrained supply growth are expected to lead the pack in 2015,” the report states.
San Francisco will continue to lead the way in 2015 with the highest rent gains among major US cities analyzed in the study. In fact, on an annual basis, many renters will pay on average $10,848 more in 2015 compared to 2012, as you can see in the map below.
If the national growth rate is 15% in 2015 as compared to 2012, San Francisco rental growth rate is expected to reach 35%, followed by Denver, with 32%.
Other major US markets with significant rent increases are: Seattle, Portland and Atlanta.
“The 10 weakest rental markets include Washington, D.C., and Northern Virginia. These metro areas are predicted to have no rent increases at all for 2015,” according to the Pierce-Eislen report.
The report also provides an in-depth analysis of the underlying factors that move prices in the market, like: new rental units supply, stable employment growth, effective rent growth in popular submarkets, stable occupancy rates and the increasing institutional and professional investor interest in the sector.
Please note that the data only refers to the “Lifestyle renters”, who are defined here: http://www.pi-ei.com/OurMethods/HowWeDefineTheApartmentRentalMarket.aspx
Tell us, do you ever work with rentals as a real estate agent?