Rent Trends Continue To Increase
Most of us pay either rent or a mortgage every month, and it is often our biggest expense. If you are renting or considering renting, you should pay attention to potential increases on the horizon. One of the biggest trends for the rental housing market in 2016 will be a continued increase in demand. According to a recent Zillow report, there were 43 million renters in America who spent $535 billion on rent in 2015. You read correctly right, that’s billion with a ‘B’. That number is up $19 billion dollars, or 3.7%, from 2014.
There is no denying that the number of renters in the United States and rental price levels have experienced a significant surge in the last year. More and more Americans are choosing to rent instead of buying a home, namely single millennials who are not tied down by family and empty-nesters downsizing their long-time family homes. A large segment of people can’t qualify for a mortgage, perhaps still affected by foreclosures from the housing bubble. In Phoenix alone, there were 599,000 rental households paying a total of $7,900 million in rent.
So will this trend continue in 2016? The general consensus says, yes. Just take a look around at all of the new apartment complexes cropping up throughout the Valley. This is partly because the population in the Phoenix metro area is expected to continue growing. According to the Maricopa Association of Governments, Phoenix added 63,800 people from 2013 to 2014. By 2040, the population is expected to grow by 2 million people. The cost of purchasing a home is also steadily increasing, and interest rates are expected to increase as well. This will be an interesting year, and definitely a good time to own investment properties!