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Rising Apartment Building Rents Boost Housing Market

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Higher Apartment Building Rents Boosting the Market


While a revitalization in the economy has been a strong stimulant in terms of boosting the motivation for people to buy a home, a stronger force in play may be the astronomical rise in apartment building rents.

Although this is a positive for us rental property investors, it’s a real drag to people who are forced to pay this higher level of rent month in and month out.  Combined with declining property prices and attractive mortgage rates, this spike in apartment building rents has presented an irresistible combination for tenants looking to improve their financial situation.

There’s no doubt about it – the rental market has enjoyed some unprecedented growth during the ongoing housing crisis. Average apartment building rents increased by 2.7% in 2011 while some of the major metropolitan cities like San Francisco saw a staggering increase of 5.9%. A reluctance to invest in homes in the precarious real estate market has also enabled the national average vacancy rate to drop below 5% for the very first time since 2001.

Market experts and industry pundits believe that the unfavorable renting equation may be the biggest push for renters to move toward investing in homes, and they foresee an exciting 2012 for the housing market. To continue reading more statistics on the rising tide of apartment building rents, click here.

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