The single-family home rental sector is growing by leaps and bounds in and of itself within the housing industry as well as within the rental market. Driven primarily by Millennial demand and low rental-home inventory, single-family rental prices throughout the nation rose +2.9% y/y in July 2019, according to CoreLogic.
Single-family home rent growth in August 2019 was propelled by low-end (less than 75% of regional median rent prices) rentals. Low-end rental prices increased +3.5% compared to high-end rental price gains of +2.7%. In fact, again according to CoreLogic, annual increases in the low-end rental market have “consistently outpaced” high-end single-family rentals since May 2014.
Molly Boesal, principle economist with CoreLogic, said, “Rent increases on entry-level properties continued to outpace the rest of the rental market, This trend should continue in the near term with strong demand from younger Millennials who indicate they prefer to rent rather than own a home.”
Metros having limited new construction, low rental vacancies, strong economies and low unemployment posted the highest rent growth in July 2019. Phoenix rental growth came in at +7.2% y/y in July and experts attributed that growth to a +2.9% growth in annual employment. Orlando’s annual employment growth rate of +3.8% pushed its annual rent growth to +3.5%.
Check out the metros with the largest rates of y/y single-family home rent growth in July 2019, according to CoreLogic:
Metro Single-family Rent Growth in 7/19
Phoenix-Mesa-Scottsdale +7.2%
Las Vegas-Henderson-Paradise +5.7%
Tucson +5.7%
Detroit- Dearborn-Livonia +3.5%
Los Angeles-Long Beach-Anaheim +3.5%
Charlotte-Concord-Gastonia +3.5%
Orlando-Kissimmee-Sanford +3.5%
Atlanta-Sandy Springs-Roswell +3.5%
Boston +3.3%
Austin-Round Rock +3.2%
Seattle-Bellevue-Everett +3.1%
Also read: https://timandjulieharris.com/2019/08/29/nine-month-inventory-climb-ended-in-july.html, https://timandjulieharris.com/2019/10/02/home-prices-in-20-us-cities-show-most-lethargic-rise-since-2012.html, https://timandjulieharris.com/2019/09/12/affordability-improves-for-1st-time-in-16-months.html
