Apartment Rents Rising Nationwide To Highest Average In Five Years

Grumbling over the rising price of rent? You’re not the only one — across the country, it’s becoming more expensive to rent, with rates rising at a pace that hasn’t been seen since before the financial crisis. Fear of even higher rents might be keeping tenants in their apartments as well, as the vacancy rate was the lowest it’s been since 2001.

Many people are likely turning to rentals instead of buying a home,  because even though rents have been higher since 2009, the current sluggish housing market and strict lending conditions is making it difficult to own a house or apartment. Add in a lack of new construction and there are more people fighting to squeeze into smaller areas at higher prices.

Real estate research firm Reis Inc. says asking rents rose to $1,091 per month, a 1% uptick from the first quarter and the biggest jump since 2007. Once you take out perks like months of free rent to entice renters, the average effective rent rose 1.3% to $1,041.

“The improvement in rents is pretty pervasive,” said Ryan Severino, Senior Economist at Reis. “Even in places like Providence and Knoxville, which you don’t think of as hotbeds for apartment activity, landlords felt the market was strong enough to raise rents on their tenants.”

For those looking for the best bargain out there, you might want to check out Wichita, Kansas, which has a monthly rent of less than half the U.S. average at $510.

US apartment rents rise at highest rate since ’07 [Reuters]

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  1. Loias supports harsher punishments against corporations says:

    That’s why I bought a home.

    • Tegan says:

      Oh hey, welcome back!! How was the wedding?

    • Sunflowers says:

      I would love to buy a house, however despite our pristine credit and my husband and myself’s decent-paying jobs, we just don’t have $30k+ sitting in our bank account for a down payment right now. Mostly everyone I know who has purchased a home has done so with the help of relatives providing DP money. We also live outside of Washington DC, where home prices are so ridiculously expensive, that a “starter home” is in the neighborhood of $400k if you want to live anywhere reasonably close to DC. It sucks, so I guess I will just continue to pay ever-escalating rent.

      • lettucefactory says:

        Same situation, same geographic area.

        People think I’m crazy not to own a home given our combined income and awesome credit scores, but where the hell would we get that kind of down payment? My parents live on social security!

        But rents only go up and up. It makes me a little ill – a problem I can’t fix…

        • VintageLydia says:

          We get the same flack. Again, same region. We’re a single income family, but that income is very good, especially when you consider our age. Back “home” we could afford a decent home in a decent neighborhood with good schools even without much of a DP. Here? I’d rather rent in the nice neighborhoods than buy in the crap holes. Job might transfer us down south and we plan on living with my MIL just long enough to save for a DP because we are sick and tired of renting :/

      • Jane_Gage says:

        It’s not recommended, but you can use a portion of your retirement account towards the DP without penalty. You just have to be careful to do it correctly.

    • 4Real says:

      Good for you now you have to pay taxes, but new things that break in it and never able to move out quickly,

      • Smiling says:

        ^This. Even with a “fixed” monthly payment for a house that is lower than my 2 bedroom apartment, we never spent so much money in our lives. Something was always needing to be done. Plus, we spent our free time working on the yard, upkeep, etc… Then, if something starts to look outdated, you have to contend with that. I won’t even get into my bitchy bored neighbor who harassed everyone, measured people’s tree heights, etc… Living in a nice apartment community is more our speed. We have everything taken care of, a pool, a workout room, use of a beautiful clubhouse etc… Plus, it is much newer with way better interior amenities than we could afford in a house.

        Renting is good for some of us, and buying is good for others. But I can assure you that buying is not an automatic solution for price hikes or anything else, as lots of unexpected and expensive things can go wrong with a house. Having a house isn’t the be all end all.

      • limbodog says:

        Correction: you can move out quickly, you just need to find a tenant. (I did, and after reading this article it is clear I charged too little)

      • scurvycapn says:

        Yeah, us homeowners are so screwed! If an appliance breaks, I don’t get to settle for a barebones model. Now I have to put forth effort to choose the model that’s right for me! I also am burdened with the freedom to make whatever changes I want to my house too. I wish I could just have beige carpet and off white walls everywhere!

        Oh, and those property taxes! Woe is me! I pay less than $1,000 a month for my four bedroom home including taxes compared to the three bedroom that I had the privilege to pay $1,200 a month for in rent! And now I am deducting thousands of dollars each year on my tax returns! It’s so terrible I tell you!

        • RvLeshrac says:

          Most apartments will allow you to install your own appliances, you just have to take them with you when you leave, and are responsible for any damages they cause.

      • MrEvil says:

        But property tax is deductible from your Income tax, and I believe that’s on top of your standard deduction. When you rent you’re paying your landlord’s property taxes, but not getting the deduction for paying them.

  2. Blueskylaw says:

    1). Gas price increases
    2). Grocery store shrink ray
    3). Rental costs increase
    4). Utility costs rise
    5). Taxes increase
    6). Food costs increase
    7). Banking fees INSANELY rise with new fees at every turn

    8). Incomes decrease?

    • fsnuffer says:

      What are you talking about. According to the government inflation is under control once they exclude gas, food, rental, and utility costs.

      • PHRoG says:

        Hey, it’s only the staples that we need to live that they don’t consider. :p

      • Blueskylaw says:

        Is this the same government that told you the air around Ground Zero was safe to breathe? By the way, you forgot your sarcasm tag :)

        • fsnuffer says:

          Yup. The same government that has told me diesel exhaust has not been proven to be carcinogenic. Talk to you later, I need to go out and huff a city bus.

          • RvLeshrac says:

            “Smells bad” is not the same as “carcinogenic.” Additionally, sucking in large quantities of CO2 will kill you, but CO2 isn’t carcinogenic.

    • scoutermac says:

      It is just the rich attacking the middle class.

    • Lokisince89 says:

      The private sector is doing FINE… Heard it on the news.

    • galm666 says:

      So you gotta ask, with the costs of things going up, where’s the value? If we’re paying more and getting less, where’s the money going?

      • Smiling says:

        Into the pockets of the rich.

        • wackydan says:

          Into the pockets of the gov’t… local state and federal is more like it.. Higher fees, taxes…. Our house was reassessed during this recession as a revenue grab by the county… property taxes went up $150 a year… Sales taxes went up…

          So there you go.

          • coffeeplease says:

            Nope sorry, corporations are posting record high profits and paying record low taxes.

            It’s going into the coffers of corporations.

  3. StevePierce says:

    In my home town in Michigan, Property Taxes have doubled in 10 years. City water rates have tripled, natural gas is also double. Cable and Internet services have increased by 50 to 75% since the state took away local control of rates and eliminated local property taxes on cable and phone companies

    The city just implemented a new inspection requirement for furnaces that will cost property owners an additional $200 for every boiler or furnace. This is above the annual inspection fees.

    Most of these increases were approved by voters or by politicians elected by voters. These voters are homeowners not renters.

    Renters, overwhelmingly are the worst for not voting in local elections.

    So if you don’t like your rent going up, get informed and vote in your local elections.

    • GrayMatter says:

      “The city just implemented a new inspection requirement for furnaces that will cost property owners an additional $200 for every boiler or furnace”

      Is this an ANNUAL inspection, an inspection when a NEW furnace is installed, or an inspection when the house is sold?
      –Annual inspection makes no sense
      –New furnace makes some sense, having seen the quality of some furnace installs
      –House inspection at sale makes a LOT of sense. Housing stock can deteriorate or zoning laws can be violated.

    • Kuri says:

      Eh, I guess I must be among the disenfranchised, as there’s a big difference between what they say they’[ll do, and what they actually do.

  4. Marlin says:

    Well duh. All the people that lost their homes now have s__ty credit so they have to rent. Since in some places they were tearing down or converting rentals to “townhomes” now there is more demand vs. supply.

    • Smiling says:

      You have to have pretty good credit to rent most places here. Maybe not crappy old houses, but if you want to live anywhere decent, you have to have good scores. Most luxury apartments won’t rent to people with foreclosures or bankruptcies.

      • aerodawg says:

        Still, people gotta live somewhere. If you can’t buy for whatever reason, then you rent. That’s pretty much the only two long term options for housing you have available to you…

  5. Overman says:

    We were renting for the past 7 years as the bubble was swelling.
    When it popped, we took advantage of the intrest rates and were able to buy our first home.
    Talked to my old landlord the other day, and he’s bumped the rent up 60%.
    Now my mortgage and taxes are cheaper than if I were renting the old place.
    Not sure how people on the “cusp” of financial responsibility are supposed to get over the hump.
    Seems like rents are raised to a point were its almost as much as owning, and I suspect there
    is an equation that landlords use to price rents to the local cost of living.
    So its possible that while real estate values have fallen, Bluesky’s reasons justify raising rates in rentals from Flint to San Francisco.

  6. dush says:

    It’s a great time to own a rental property.

  7. Will Print T-shirts For Food says:

    Yup, My fancy apartment complex raised their rental rates by $240 per month, and I’m moving. With my ex. I wonder how that’s gonna go…..

  8. SirWired says:

    Current lending standards aren’t making it difficult to own a home at all! It’s more difficult than during the recent looney-toons lending spree (leading to the crash.) But it certainly isn’t more difficult than before the crash.

    • SirWired says:

      shoot… the end should have read “than before the bubble”

      • RvLeshrac says:

        Yes, but if you buy a home, you’re going to be called a dirty, irresponsible, low-life sack of shit in a few years when you’re unable to pay for it because your income has continued to decrease.

        What’s the point?

  9. MaytagRepairman is stealing socks while fixing your dryer. says:

    The area I was renting an apartment in before the peak of the market, was converting apartment buildings into condominiums left and right. When I moved away to the next town over I could only remember 3 apartment complexes left and 2 of them were in dire need of remodeling.

  10. EdnasEdibles says:

    I have a condo that I’m renting out (can’t sell it) and for 2 years the rent was ridiculously low because there was so much competition. I was losing $300/month because the rent was lower than my mortgage. Just this year I’ve been able to charge a higher rent. So yes, the rent price increased but it was super low for 2 years.

  11. buddyedgewood says:

    Rents going up? Not here in Phoenix, they actually seem to be going down…

  12. mauispiderweb says:

    Brand new building across the street in North Brooklyn:

    1 BR = $3300/month
    2 BR = $3700/month
    3 BR = $5000/month

    People are moving in. WTF do they do for a living to afford the rent?

    • RvLeshrac says:

      The run businesses that are increasing the price of goods while decreasing the number of workers (and their salaries).

      WOO, FREE MARKETS!

  13. bhr says:

    I was talking to someone about this the other day and we came to the conclusion that same size units probably arent up much over 2006-2007. What is driving average rent up the most is that people who used to pay mortgages are now in many cases renting homes or larger units. Just because you can’t get a new mortgage doesn’t mean a family of five can suddenly live in a two bedroom apartment.

    Many of those foreclosed homes were bought up by investors and are being rented out to the same class of people who used to own them, at prices significantly higher than the average apartment rental.

    When the pool of expensive (relatively) properties expands the average price has to go up.

  14. srufus says:

    How about Rent-Control from government?

    • shepd says:

      How about all apartments never being maintained at all to offset rent control? And landlords upping rent by the maximum rent-control allows always no matter what?

      It’s a great idea if you already live in a rathole, though.

  15. 4Real says:

    mine went from $880 to $905 I was mad….

    • Smiling says:

      My two bedroom in Texas went from $1323 to $1383. Interestingly enough in 2000, when I looked at renting here, the same apartment was $1295. So, the net increase over 12 years has been less than $100. We didn’t live here then though.

    • Kestris says:

      Mine went from 455.00 to… 455.00. Unless my landlord yells at us for still paying the monthly pet deposit again, then it’ll go from 455.00 a month to 425.00 a month.

      2bd, 1ba duplex townhouse with a great neighbor next door- shares the wall, large back yard, awesome landlord who basicly said do what I want with the yard, let us repaint, retile and refinish the countertop in the kichen and bathroom, as well as repaint the rest of the house, pull out all the carpeting to reveal the original hardwood flooring and has a very fast response time to any maintance issues we can’t handle?

      Darn straight we’re staying put.

  16. lovemypets00 - You'll need to forgive me, my social filter has cracked. says:

    I see that in my area, mostly due to the influx of gas workers.

  17. scoutermac says:

    Yeah we were renting. We went looking for homes and ended up being able to buy a condo that was much larger than our apartment and it cost much less per month. We wanted a house but we could not justify paying $200,000 for a house that needed to be gutted.

    • tbax929 says:

      I bought my house in December 2010, and I’m paying quite a bit less than I was paying to rent. I should note that I was renting a luxury apartment in an affluent part of town. I bought near the local air force base. Even when I factor in utilities and maintenance, I’m still coming out ahead.

      We’re contemplating a move to another state in January, and when I look at what people are getting for renting out their houses in my area, I should be able to charge about $300 more than my mortgage.

      • cantiloon says:

        And could you afford to buy in that same affluent neighborhood? I’m sure the answer is no. It’s all relative and in Philly, I can assure you that from doing both over the last two years, that renting is much more affordable. You can get more bang for your buck if you don’t mind an hour plus commute into the city. I think people are missing a huge factor when saying “owning is cheaper” argument: down payment. Where I live, the absolute cheapest houses that aren’t in dangerous neighborhoods or the sticks start at 250K. You need at least 25K in cash just to pay about 5% of that when you factor in closing costs. Then you’re looking about about $1,600 per month with PMI and insurance. You can get that monthly down if you’ve saved up a huge chunk of cash, but that’s not realistic for most people, even with good combined incomes. You can get a house in the burbs for that 250K (including well over a year’s worth of rent up front) or you can get a beautiful (albeit smaller) apartment in a much nicer neighborhood, and you know you will never have to worry about tax increases or repairs. It’s all relative and really depends on your situation. Also, it’s just plain stupid to buy unless you know you will live in a place for 5-7 or more years. A lot of people aren’t ready to make that commitment.

  18. chatterboxwriter says:

    I’m stuck in a horrible rental for this very reason. We were going to buy a house, but then my husband was laid off and — even though he started a new job three weeks later — the mortgage company will no longer count his income toward our debt-to-income ratio. So now we have to wait until he’s been employed continuously for two years before we can try again. My house is a double block (duplex, for you New Yorkers) with horrible neighbors who scream and bang around all night long. The bathroom sink doesn’t work, the toilet tank parts are held together with a paper clip and a shoelace, and a faulty bathtub trap led to damaged ceiling tiles in the kitchen — so now there’s a big hole in the ceiling. Unfortunately, landlords here are taking advantage of the market to inflate rents. I live in a terrible neighborhood with constant crime and noise, and there are people asking $1,000/mo. for crappy little rentals (we pay $500/mo. now). I’d rather stay here at $500/mo. for another two years than move and pay twice that to live in the same crappy neighborhood.

    • scoutermac says:

      Sounds familiar. I was able to get a loan after starting at a new job for two months by going to a mortgage broker.

  19. Kestris says:

    My landlord not raising rent unless the tenant moves out as well as being completely awesome is why we don’t move.

  20. ScottG says:

    I guess Jimmy McMillan was right, Rent IS Too Damn High.

    (those of you living in NY might remember Jimmy McMillan running for governor a few years back under the party Rent Is Too Damn High. He even had a song)

  21. HogwartsProfessor says:

    I can’t even afford $510. That’s why I bought in 2002. But now, of course, I’m stuck with a house I can’t fix up even though the bathroom is falling apart. So saving $100 a month isn’t helping me much, with the price of everything else going up so much. And no job.

  22. Foot_Note says:

    sluumlord… “Squeeeal*

  23. Extended-Warranty says:

    Yea, there’s the loophole in the uneducated argument that renting is a better financial decision that buying a home (in general). Another news flash, yes, you pay for your maintenance and taxes at an apartment complex. In fact, you even pay the maintenance for irresponsibile assholes.

    My mortgage payment is fixed for 15 years (at dirt low interest). Then it’s gone. You’ll be lucky if your rent stays the same for 5 years.

  24. human_shield says:

    I could easily argue that my mortgage is less expensive than renting, even with taxes and insurance included. And that’s significant, since my taxes/insurance are almost $500/mo. That’s on a mortgage of $600. I was renting previously on an apartment half the size for $1,400/mo.

    But, you spend far more on a house with updates, landscaping, repairs, decorating/furniture…homeownership is expensive.

    It’s pretty ridiculous that my taxes and insurance cost as much as the freaking house.