The construction of new apartments has reached a record last year, but all of this new supply is apparently not enough to cool competition on the market. Obtaining a rental becomes even more difficult, according to a new backcafe report, an apartments search site.
Last year, the developers carried out nearly 600,000 multifamilial units, according to the American census. It is the highest level since 1974 and an increase of 34% compared to 2023. New York City, Dallas and Austin, Texas, led the number of new rentals.
Despite this, at the national level, the competitiveness of the rentals increased at the beginning of this year, according to the competitiveness index of the Rentcafe rental. This is largely because an increasing number of tenants do not move.
Lease renewal rates increased to 63.1% at the start of this year, compared to 61.5% at the start of last year, according to Rentcafe. Much of this is probably due to higher mortgage rates and high prices on the housing market for sale.
The occupation of the apartments also lies firm at 93.3%, slightly higher than at the beginning of last year. In addition, the owners offer longer rental periods, which then causes prolonged renewal periods, depending on the report. Consequently, each available apartment has an average of seven candidates.
Looking locally, Miami has the highest occupancy rate. It is the most competitive, with an average of 14 candidates for each unit.
“In recent years, Miami has established himself as” Wall Street South “, attracting large banking institutions and investment companies, while existing industries such as technology and health care continue to grow, making more workers come,” wrote Veronica Grecu, creative writer and principal researcher for Rentcafe. “In addition, the lack of tax on Miami Location at the crossroads of the Americas remain major prints for professionals and businesses. ”
The Midwest, however, leads to the overall rental competitiveness. Ten of the hottest 20 best rental markets are in the region, the suburbs of Chicago arriving in second position behind Miami. Others include Detroit, Lansing and Grand Rapids in Michigan, as well as Cincinnati; Milwaukee; and Minneapolis-St. Paul at Minnesota.
The rents, who were trying, are increasing again. Nationally, rents increased by 0.3% in February, the first monthly advance in rents after six consecutive months of decline, according to Apartmentlist. February is the start of the historically occupied season on the rental market, and rents should increase throughout the summer. However, rents are still 0.4% lower than they were in February from last year.
After a period of record rent growth in 2021 and the first half of 2022, the national median rent now fell below its August 2022 peak of a total of 4.6%, or $ 67 per month, according to Apartmentlist. The typical rent price, however, is still 20% higher than in January 2021.
“The growth of rents from one year to the next has now been negative since June 2023, but in recent months there are signs that a return to positive growth is on the horizon,” according to the authors of the Apartmentist report.