Goodbye, renters market: Rents grow as demand increases – Irvine Real Estate – Irvine Homes for Sale

by Robert Mack on March 21, 2011

in Latest News

The good times are over for renters. At the start of the housing bubble, the rental market stumbled as landlords were forced to cut rents to hold onto existing renters and attract new ones. Many landlords offered concessions and discounts to fill their units. Now rents are on the rise again — not because the economy is improving but because it remains stagnant.

It’s a classic example of supply and demand. As Americans have lost their homes or continue to put off buying a home, there are more renters than ever. With inventory constrained, landlords increased rents. In 2010, rents nationwide increased an average of 4.2%. In 2009, by contrast, landlords offered greater discounts to attract tenants, and effective rents fell 5.9%. According to Axiometrics, an apartment-market research firm in Dallas, 2010 was one of the best periods for landlords in the past 15 years and may mark a turning point in the short term. (Bing: What’s the difference between effective rent and asking rent?)

Rents recently rose again at the Lofts of Greenville, a luxury property in Greenville, S.C. Built in 1900, The chic, renovated textile mill, built in 1900, achieved full occupancy in February. Before that, the landlord, responding to strong demand and low vacancy, made incremental rent increases and eliminated concessions such as one free month. Rates there now start at about $780 for one-bedroom units — 16% more than the average monthly rent in the area — but apartment hunters have not turned away.

Posted on Irvine Orange County Real Estate Market News

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