U.S. apartment rents have jumped more than 10% since early 2020

[Yo_Mama_Been_Loggin]

Apartment rents have been growing at a rapid clip this year, after a stagnant to modest increases observed during the height of the Covid-19 pandemic last year.

Much of that is attributed to demand. Richardson, Texas-based RealPage Inc. recently found occupied-apartment count jumped by 255,094 units in the third quarter, the biggest quarterly product absorption figure on record.

Annual demand in 2021, as of Q3, stands at 597,354 units. That's compared to average annual demand of about 250,000 units seen between 2010 to 2020.

Apartment rents are now at or meaningfully above pre-pandemic prices everywhere, except the San Francisco Bay Area, according to RealPage.

https://www.bizjournals.com/seattle/news/2021/10/13/rent-rate-growth-and-affordability.html

[Shermann]

1. How can rents be increasing at the same time as a housing bubble?

Some of it is just inflation, but 10% represents a real increase above and beyond that

[inthewind21]

2. This is how

https://www.bloomberg.com/opinion/articles/2021-08-05/first-time-homebuyers-are-getting-squeezed-out-by-wall-street

[Shermann]

3. That should be creating more supply of rental properties though which would drive rents lower nt

[haele]

5. Gentrification causes rents to go higher.

Real Estate investment portfolios snap up distressed properties with cash offers, make some cosmetic changes, then rent them out for twice what renters in the area are paying - or what the previous tenant was paying. While middle income households are willing to pay what would essentially be their mortgage if they had bought and fixed the property themselves, lower income renters are being squeezed out of housing they can afford because these investment portfolios are not going to rent to them, they need to make a profit.

Haele

[TheRealNorth]

4. This is why I have kind of shifted toward looking for a lot to build on...

And I figure I can find a builder when the material costs go down.

Granted, this may not be an option in a built-up area unless you are willing to live toward the edge of a metro area.