The new housing construction reached a record high last year, but all the new offer apparently is not enough to cool the competition on the market. According to a new report by Rentcafe, an apartment search, it is actually becoming even more difficult to get a rent.
Last year, the developers completed almost 600,000 apartment buildings according to the US people's count. This is the highest level since 1974 and an increase of 34% compared to 2023. New York City, Dallas and Austin, Texas, led to the number of new rentals.
Nevertheless, the competitiveness of the rent increased at the national level at the beginning of this year, according to Rentcafe's rental competition capacity index. This is largely due to the fact that a growing number of tenants has not moved.
According to the Rentcafe, the rental extension rates rose to 63.1% compared to 61.5% compared to the previous year. Much of this is probably due to higher mortgage interests and increased prices on the sales apartment market.
The apartment allocation also holds a company with 93.3%, slightly higher than at the beginning of the previous year. In addition, the landlords offer longer rental periods that, according to the report, lead to longer extension periods. As a result, each available apartment has an average of seven applicants.
Miami sees on site and has the highest occupancy rate. It is the most competitive with an average of 14 applicants for each unit.
“In recent years, Miami has established itself as 'Wall Street South' and attracts large banking institutions and investment companies, while existing industries such as tech and healthcare continue to grow and bring in more workers,” wrote Veronica Grecu, Senior Creative Author and Researcher for Rentcafe, in the report. “In addition, Miami's lack of income tax and its location at the intersection of America remains important attractions for specialists and companies.”
However, the middle west leads the total rental competitiveness. Ten of the 20 hottest rental markets are in the region, with the Chicago suburb behind Miami in second place. Others are Detroit, Lansing and Grand Rapids in Michigan and Cincinnati; Milwaukee; and Minneapolis-St. Paul in Minnesota.
The rents that had loosened are now on the rise again. According to the apartment list, rents rose by 0.3%in February in February, the first monthly progress in rents after six successive declines. February is the beginning of the historically busy season on the rental market, and rents are expected to increase all summer. However, rents are still 0.4% lower than in February last year.
After a period of record growth in 2021 and the first half of 2022, the National Median rent has now decreased by 4.6%or 67 USD per month below the height of 4.6%or $ 67. However, the typical rental price is still 20% higher than in January 2021.
“The rental growth of the previous year has been negative since June 2023, but in the past few months there have been signs that return to positive growth is on the horizon,” said the authors of the apartment list report.