US Rental Market Continues to be Robust

Apartment metrics in the first quarter of 2015 demonstrated that things are still going strong, according to Axiometrics early release figures. The 4.9% annual effective rent growth rate is the highest since the third quarter of 2011 and the highest first-quarter rate since 2006

Among metros, Northern California again dominated the annual effective rent growth list of the top 50 apartment markets, determined by number of units. As was the case in the fourth quarter, that region had four of the top five metros on the chart. The only change among the top five was that No. 2 San Francisco and No. 4 San Jose swapped places from the fourth quarter.

U.S. apartment vacancy rate fell to 4.1 percent in the first quarter, from 4.2 percent in the fourth, while new construction declined to its lowest level since the first quarter of 2013, according to the real estate research firm Reis.

Solid job growth, single-family home affordability and the continuing trend of people choosing to rent instead of buy all contributed to the first-quarter metrics.  Wall Street Journal

The average renter paid $1,114 per month in the first quarter of 2015, $6 more than in the fourth quarter of 2014, a quarter-to-quarter effective rent growth rate of 0.5%, which matches the same rate recorded in the first quarter of 2014.

 According to REIS, New York remained the most expensive market in the country with effective rents registering $3,200 per month, a 45 percent premium to San Francisco, which remained the second-most expensive market,

Single-family rental properties have been around for a very long time, but they have become a hot commodity only in the past few years. According to the U.S. Census Bureau, the number of rental homes reached an all-time high of 14.9 million homes in 2013 (the latest data available), an increase of almost 3.0 million rental homes since the end of the Great Recession in 2009.