According to National Apartment List Rent Report, March rents grew .4% which is a decline from the January and February increases of 1% each month. Rents have been slowing much faster in larger cities and growing faster in areas surrounding larger cities. The year over year growth at the national level is currently at 2.4% which is lower compared to 2016 and 2015 during the same period. According to the National Apartment List Rent Report rents are expected to continue to grow at a slower rate this year than in previous years.
Slower rent growth is being attributed to more rental units coming onto the market in certain parts of the country leading rental prices to fall in 19 of the 100 largest cities over the last year and in 30 of the largest cities over the last month. Of note, the cities whose rents are growing fastest are those that surround major US cities. For instance, Stockton CA had a 12.5% increase in rent over the past year. In addition, major cities are seeing a decrease in rent including San Francisco and Washington DC.
For many landlords that have been able to raise rent and consequently increase their profits as demand in major cities rose over the last few years, this report could be a sign of a changing market trend that could drastically affect their profit margins. Stagnant or decreasing rents could be devastating for landlords that have recently invested capital or made purchases on rental units hoping the rental price would increase.
With these changing trends, it is more important that landlords have effective property management systems in place that enable them to efficiently manage their property so they can save money and offset potential losses in rent. While cyclical changes in the rental market can sometimes make managing rental properties more difficult, having Management Property Software is essential whether you're in a rental market seeing a growth or a market seeing a decline in rent.
This post is provided by RISSOFT Residential and Commercial Property Management Software, specializing in innovative and cutting-edge property management software for all 50 states. Request a demo or contact us today to receive more information.
Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.