NEW YORK (AP) — Rents are starting to fall after surging to record levels last summer, but experts aren’t sure the slowdown will continue.
Christopher Meyer, a real estate professor at Columbia Business School, says people looking for an apartment now may have a better experience than they did in May or June.
“We don’t see rents rising that quickly. The rental market is softening a bit,” he said.
Nationwide, median asking rents increased 14% in July compared to July of the previous year, the smallest annual increase since November 2021, according to a new report from Redfin. The percentage is still high, but down from 15% in June and 16% in May.
Experts say the market could slow further towards the end of the year, but there are still many uncertainties.
Bryan Carberry, senior managing editor at Redfin-owned apartment search website Rent.com, said:
A lot depends on where you live. Florida cities such as Boca Raton and West Palm Beach saw rents drop by 0.1% and 0.5% respectively from last month. But according to Apartment List, rents in coastal California cities like San Diego have continued to rise in his past year.
Rent in Rochester, New York rose 15.3% in August compared to the same month last year, according to Apartment List data. The average two-bedroom apartment in the Rochester area was $1,318 in August, compared with $1,116 a year ago.
Bank of America Chief Executive Brian Moynihan said high rents were a concern because they could make up a large portion of a household’s take-home income.
“Gas prices are going down, but rents are going up by 10, 12, 15 percent. said in an AP interview.
Things look a little better for renters than they did a few months ago, but it’s still a landlord’s market, Mayer said.
If your lease is expiring, continuing to negotiate with landlords may be a better option than trying to move, at least until the rental market slows further, according to an industry survey from the National Association of Apartments and said Paula Munger, VP of Analytics. .
“When you renew your lease, you never pay as much as someone new moves in,” says Munger. “If possible, please stay in your apartment.”
The main reason for the surge in rents is increased demand from people who have been discounted from the booming housing market. That market is starting to slow, which could mean more people can afford to buy and don’t have to rent, but with interest rates rising, some people don’t want to take out a mortgage. There may be
“Right now, there’s a lot of inflation going on across the market, and there’s not enough supply, so prices are going up,” Munger said. “That’s the downside for people. It’s that they don’t have enough choices and choices about what they want in a housing unit.”
Developers are building more condominiums this year, which could ultimately help ease the crisis.
Meanwhile, high rents have disproportionately affected low-income residents across the country, according to Ben Martin, research director of Texas Housers, a nonprofit that works on housing justice. It is said that he is giving a blow.
“Those with the lowest incomes are paying more than the total money pie,” Martin said. “That means I don’t have the money to buy school supplies, groceries, gas, clothes, and all the necessities of life.”
In addition to lowering basic costs, renters are packing more people into their apartments, Martin said.
More and more people can’t afford their homes and face evictions. The government has ended moratoriums on evictions and rental assistance programs that allow people to stay home during the pandemic.
The Eviction Lab, a research institute at Princeton University, is seeing record numbers of evictions that exceed pre-pandemic levels.
Unable to raise rents or move, tenants are often forced to choose between paying rent and providing for basic necessities. Evictions will be on the tenant’s record and make it harder to find housing in the future.
“The threat of eviction is a looming problem,” says Nick Graetz, a postdoctoral researcher at The Eviction Lab. “Part of the reason renters are sacrificing so many other things in trying to pay exorbitant rent each month is because of the constant threat of being evicted from their homes.”
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