The rental crisis is easing, according to a new survey, which shows that tenants are benefiting from an increase in supply.
“That’s exactly what had to happen,” Ken H. Johnson, Ph.D., an economist at FAU’s College of Business, said in prepared remarks.
“Additional supply appears to be coming from the delivery of units under construction, an increase in unit density, and the conversion of many Airbnb-like units to long-term rentals.”
Florida Atlantic University and two other schools conduct this monthly survey.
Its October report showed that 70 housing markets (down from 38 in September) had lower average rental rates.
Springfield, Massachusetts; Austin, TX; Seattle and New York are among the metros where rents are falling. The average rental rate in the United States was $2,040, down 0.9% from September.
Florida leads the United States in rent growth
Florida was less affected by the downturn as rental rates there remained high in some markets.
Cape Coral-Fort Myers led the United States with both the largest year-over-year rent increase (17.16%) and the largest premium (17.37%).
Most rents in Florida are falling month over month, but Cape Coral-Fort Myers saw a 1.76% increase in October.
“The significant increase in Cape Coral-Fort Myers is very disheartening, but not surprising,” said Shelton Weeks, Ph.D., of Florida Gulf Coast University’s Lucas Institute for Real Estate Development & Finance, in prepared remarks. .
“The monthly index report highlights the continued cost of Hurricane Ian. There are signs of recovery, but affordable housing is expected to remain an issue in this market for months to come.”
A premium is the amount above the long-term rental trend that tenants must pay. Rents generally only increase by 3 to 5% per year.
Vegas posts lowest annual increase
The FAU report showed that Las Vegas posted the smallest annual rent increase in the country at 1.58%. Minneapolis had the smallest premium at 1.03%.
Bennie Waller, Ph.D., of the University of Alabama’s Culverhouse College of Business, said that over the past two months rents have slowed and returned to a more normal year-on-year trend. other.
“It’s clear that much of the country is starting to shed these steep increases, which have been so devastating to consumer budgets,” Waller said in prepared remarks.
Comments are closed.