Single-family rental prices are growing, with the biggest jumps in lower-end brackets. Low-end rental prices—properties with rent prices less than 75 percent of the regional median—were up 3.8 percent compared to high-end price gains of 2.4 percent, according to January year-over-year data released by CoreLogic on Tuesday.
Low-end rental home inventory is fueling the bulk of single-family rent price growth lately, according to the analysis. Year over year, rent prices are showing some signs of slowing after major climbs between 2010 and 2018.
“National rent growth in January 2018 was pulled down by high-end rentals, which are defined as properties with rent prices 125 percent or more of a region’s median rent,” according to CoreLogic’s report.
CoreLogic’s Single-Family Rent Index analyzes single-family rent price changes nationally among 20 metro areas.
Among those 20 metro areas analyzed, Las Vegas had the highest year-over-year increase in single-family rents in January 2018 at 4.8 percent, followed by Orlando and Phoenix.
Metro areas with limited new construction, low rental vacancies, and strong economies that attract new employees tend to have stronger rent growth, according to CoreLogic. CoreLogic credits Orlando and Phoenix’s rises to employment growth.
“Single-family rent price growth remained solid in January,” says Molly Boesel, principal economist for CoreLogic. “High demand and low supply for entry-level properties drove lower-priced rentals to have faster price growth than higher-priced rentals, revealing affordability pressures in this segment of the rental market.”
—REALTOR® Magazine Daily News
