Monthly rents nationwide are seeing rent increases averaging between +14% – +30%. Prepare yourselves, renters.
Rent Deals & Concessions Past Tense
The halcyon days of discounted rents and big concessions between mid-2020 and mid-2021 are completely over. Average listed monthly rents have jumped more than +14% across the country, according to Redfin.
In many major metros, rents have jumped +30% y/y. Take a look.
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Metros with Fastest-Rising Rents Y/Y
- Austin TX – +40%
- Nassau County NY – +35%
- New York NY – +35%
- Newark NJ – +35%
- New Brunswick NJ – +35%
- Miami FL – +34%
- West Palm Beach FL- +34%
- Fort Lauderdale FL- +34%
- Jacksonville FL – +31%
- Portland OR – +29%
Renters, Prepare Yourselves
Allia Mohamed, co-founder and CEO of Openigloo, an app NYC renters can use to review landlords, recommends that all renters learn as much as they can about their rights and protections. These rights and protections vary by location so just because a renter knows what’s happening with rents and renters in St. Louis doesn’t mean that renter knows what’s happening in rent- and renter-wise in Dallas.
For example, rent hikes in Oregon are limited to +7% plus inflation. In Santa Ana CA, legislation just passed that caps rent increases in most buildings to no more than +3% over any 212-month period. In St. Paul MN beginning May 1, rent increases will be limited to +3%/year.
Such largesse towards renters is not the case with most landlords in most places. Landlords most everywhere are free to raise rents in upcoming lease renewals to whatever they’d like. Some landlords, however, have to provide their tenants with notice of pending rent increases.
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In Seattle, landlords must offer their tenants notice of 180 days prior to any rent changes. Most renters throughout Washington state are guaranteed a 60-day notice. Also in Seattle, and in Portland OR as well, landlords may be required to pay moving costs if their tenants can’t afford to stay in their homes after a rent increase.
The bottom line for tenants: DO YOUR HOMEWORK AND KNOW YOUR RIGHTS!
Do Comparative Searches
Openigloo’s Mohamed suggests that renters research rents and rent increases of comparative apartments/houses in their current neighborhoods to get a sense of going values.
If other units in a tenant’s respective neighborhood/surrounding area are less, make a list of those units, suggests Patty Crawford, vice president of strategic accounts at Zumper, an online rental marketplace. (Zumper.com enables tenants to look up median rents in many places. Use it.)
Talk with Landlord
Having a conversation with the landlord can be most worthwhile. Ask whether or not and/or how much a pending rent increase for lease renewals would be. Perhaps the landlord would consider half the rent increase payment in the first six-months and the balance payment of the increase in the second six-months.
Ask whether or not the landlord has or is expecting vacancies. If yes, perhaps the tenant could offer to make referrals of potential tenants to the landlord in exchange for a rent concession/discount on any rent increase.
Moving Expenses May Outstrip Rent Increases
Even if the rent jumps at lease renewal time, moving expenses may cost more. Jay Parsons, vice president and deputy chief economist with RealPage, said, “Property managers routinely price renewal leases below what they’d charge a new tenant.” In fact, in 2021, renewal rent increases grew at just one-third the rate of new leases.
Zumper’s Crawford said, “Upfront costs such as movers and utility transfers can add up and might actually be more expensive than the rent increase.”
On the other hand, Openigloo’s Mohamed said, “If a steep increase puts you far above that threshold (more than 30% of income), I’d suggest finding something else. Even if (the renter) could tolerate the increase by cutting back in other areas, this may be unsustainable if the rent goes up again the following year.”
Thanks to CNBC.
