People often ask whether or not now is a good time to buy a home. No one ever asks when a good time to rent is. However, we want to make certain that everyone understands that today is NOT a good time to rent.
The Census Bureau recently released their third quarter median rent numbers. Here is a graph showing rent increases from 1988 until today:
A recent Wall Street Journal article reports that rents rose “faster last year than at any time since 2007, a boon for landlords but one that has stoked concerns about housing affordability for renters.”
The article also cited results from a recent Reis Inc report which revealed that average effective rents rose 4.6% in 2015, the biggest gain since before the recession. Over the past 15 years, rents have risen at a rate of 2.7% annually.
Where are rents headed?
Jonathan Smoke, Chief Economist at realtor.com recently warned that:
“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.”
According to the WSJ article:
“In general, the higher rents go, the more difficult it will be for young people to save for down payments, making them likely to rent even longer.”
One way to protect yourself from rising rents is to lock in your housing expense by buying a home. If you are ready and willing to buy, meet with a local real estate professional who can help determine if you are able to today!