If you think rent increases have spiked in multifamily buildings since the beginning of 2021, check out increases of nearly +13% for single-family homes.
Single-Family Home Rentals Experiencing Highest Rent Increases in 5 Years
Asking rents for single-family homes have soared nearly +13% year-to-date through the end of July, according to Yardi Matrix. This is the biggest jump in single-family home rents over the last 5 years.
Multiple Causes
Demand from priced-out homebuyers and investors is flooding the single-family home rental market. City residents who had decided to wait out the pandemic in suburban home rentals added to this demand. Plus, fewer homes are being built which further stifles supply. (Housing starts dropped -7% m/m in July and home builder confidence is at a 12-month low.)
Accelerating Price Increases Began in Spring 2021
According to Yardi Matrix data, single-family home rents began shooting up this spring. In March, asking rents increased +7.2% y/y, +8.6% y/y in April, +10.5% y/y in May and +12.8% y/y in July.
CoreLogic indicated that rents for all single-family homes across the country, including renewals, jumped +7.5% y/y in June alone.
More Investor Dollars into Single-Family Home Rental Sector Implies Even More Rent Spikes
Check out another of this week’s posts “Biggest Increase in Tenants in History” for a more detailed explanation of additional investor dollars coming into this market sector. Suffice it to say that billions of investor dollars are flowing into single-family home rentals. Those billions will only mean steeper rental prices for single-family home tenants.
Thanks to Yardi and TheRealDeal.
