In the past year, there has been a significant increase in the construction of apartment buildings by developers. According to RentCafe, over 500,000 rental units are expected to be completed by the end of this year.
However, despite this surge in new rental options, renters are still facing challenges when it comes to finding an apartment. This is highlighted in another report by RentCafe which states that “more rental options haven’t made things easier for renters.” In other words, even with more supply on the market, it is still difficult for renters to find suitable homes.
One contributing factor to this trend is that many renters are choosing not to move and instead renew their leases due to the hassle involved in finding a new place. As stated by RentCafe: “This has resulted in lease renewal rates increasing from 60.2% last year up to 62.2%.”
Ironically enough,the high competition for available apartments is actually causing more people stay put rather than move out and look elsewhere.This means that those who do want or need a different living situation must act quickly before someone else snatches up their desired unit.
Additionally,the cost of financing and purchasing single-family homes remains high,making renting a more attractive option for potential buyers.In light of these factors,RentCafe predicts that we will see similar trends continue into next year as well with most renters staying where they currently reside.
Of course,this all varies depending on location.As with most real estate matters,trends can differ greatly based on geography.Nationally,the competition among rentals remains fierce.However,in Miami,it was reported as being one of hottest markets due its thriving tech and finance industries,no-tax policies,and strategic position as gateway into Latin America.Suburban Chicago came second thanks largely because its affordability along with numerous corporate relocations/expansions.Finally,”hipsturbia” continues fueling demand throughout areas such Arlington Heights,Barrington,Deerfield,Evanston,Glenview,Naperville,and Oak Brook in Illinois.This has resulted in an overall occupancy rate of 95.4% according to RentCafe.
RentCafe also released a list of the top competitive markets for apartment renters.In addition,Louisville,Kentucky was named as the fastest-growing market for renters followed by North Carolina’s Piedmont Triad region.However,the limited availability of apartments posed challenges in both areas.Lehigh Valley,Pennsylvania was deemed as the hottest small market for apartment hunters due to its lack of available units.
