For many people, renting is a part of life at some point. However, the rental market is not a static thing. It is fluid, and it can go up and down. What does the rental market look like in 2019? The rental market is hot, and it looks to continue that way throughout the year.
That is because more people are renting for longer periods of time. In some markets, renting might even be more affordable than buying a home when all things are considered. For example, someone renting a home in Newark only has to worry about utilities and - if they’re the cautious type - finding an affordabe renters insurance NJ policy. A homeowner in that same market has to think about utilities and insurance on top of skyrocketing property values and one of the heaviest property tax rates in the country.
What has the response been to this demand for rental housing? There has been an effort on the part of real estate developers to meet this significant demand by adding more rental units, which has helped to stabilize rent prices in some parts of the country such as in the Washington D.C. metropolitan region. However, that has not necessarily been the case everywhere. The rental market trends in New York City bear this out with average rents for one-bedroom apartments in the city in June 2019 hovering near the $3000 per month mark.
Rental housing supply can be a concern for renters because demand can easily outpace supply. With this mismatch, that can mean fewer options and affordability for renters. That is especially true at the lower end of the rental market. While rental stock may be added to an area, it is not necessarily moderately priced. In fact, the newly added rental stock may be geared toward more affluent renters. Such has been the case in the Boston region with new stock being added but much of it geared toward the upper end of the market.
The mismatch between the need for moderately priced rental housing and options available is not limited to the D.C. region. In fact, the National Apartment Association is concerned that there is a gap in various parts of the country with not enough rental housing available at all price points.
There is a real interest among renters in finding moderately priced rental housing. This interest is reflected in popular search terms on Google with the terms "cheap apartments" and "studios" make up about half of apartment-related searches on the popular search engine. Of course, the luxury market gets its share of searches as well.
Driving the rental market, including rental market trends in the New York area, are the difficulties surrounding homeownership right now. Mortgage rates are rising, and there is a lack of single-family housing stock available. That makes the move from renter to homeowner a bit challenging. In fact, it is expected that fewer people will make that shift from renter to homeowner in 2019.
If trends continue in this direction, it would be reasonable to think that these rental market trends may stretch beyond 2019. That could be true not only for the New York region but beyond as well.
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