Rent growth shows signs of slowing down across many markets, according to the November report from Apartment List. But property owners need not worry.
The report noted that "Since January of this year, the national median rent has increased by a staggering 17.8 percent. To put that in context, rent growth from January to November averaged just 2.6 percent in the pre-pandemic years from 2017-2019."
Although we are finally seeing a slowdown in rent growth after two years of accelerated gains, this year's total growth is still up compared with pre-pandemic levels. This cooldown is expected since the seasonal dip in rent is typical for this time of year.
"The pace of rent growth has been cooling rapidly for the past few months, but growth is still outpacing pre-pandemic trends, with the slight uptick this month coming at a time of year when seasonality normally causes prices to dip."
"And while this month's growth rate was essentially flat, it's worth noting that we normally see rent prices decline in November. In the pre-pandemic years from 2017-2019, rents fell by an average of 0.5% from October to November." the report says.
The vacancy rate continues to rise slightly.
Our vacancy index spiked last April as many Americans, in the wake of the pandemic, found themselves unable to afford market-rate rents and instead moved in with family or friends. Afterward, vacancies began a steady decline, eventually falling below 4 percent.
"Our vacancy index spiked from 6.2 percent to 7.1 percent last April, as many Americans moved in with family or friends amid the uncertainty and economic disruption of the pandemic's onset."
But after reaching a record-low 3.8 percent in August, our vacancy index has risen slightly for three consecutive months and now stands at 4.2 percent.
"Although the recent increase has been modest and gradual, it represents a significant inflection point, signaling that tightness in the rental market is finally beginning to ease. The report says.
Addressing Vacancies through Property Management
When a rental property vacancy is looming, you need to get the next tenant lined up quickly. To do this, you will have to schedule showings, meet with applicants, collect applications and find a new tenant. Tenant screening is essential to prevent losses. These are the areas where a property manager can help you out.
Property managers can also assess your rental, using professional tools and industry knowledge, to find its ideal rent price. Your monthly income will increase if you set the rent price to match the market.
Many property management companies are affordable and have straightforward fee structures, so owners can plan and estimate their profits throughout the year. Plus, working with a property manager can maximize your profit.
Do you need help managing a rental property? Find out more about rental news, managing rental properties, and find helpful advice on maintaining your rental investments on the Illume Property Partners website. Contact us today.