Now is Not a Good Time to Rent
People often ask if now is a good time to buy a home. No one ever asks if its a good time to rent. However, I want to make sure everyone understands that today is NOT a good time to rent.
The Census Bureau recently released their first quarter median rent numbers. Here is a graph showing rent increases from 1988 until today:
A recent Wall Street Journal article reports that rents rose “faster last year than at any time since 2007, a boon for landlords but one that has stoked concerns about housing affordability for renters.”
The article also cites results from a recent Reis Inc. report which revealed average effective rents rose 4.6% in 2015, the biggest gain since before the recession. Over the past 15 years, rents have risen at a rate of 2.7% annually.
Where are Rents Headed?
Jonathan Smoke, Chief Economist at realtor.com recently warned:
“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.“
Real Estate Bottom Line
NAR’s Chief Economist, Lawrence Yun:
“With rents steadily rising and average fixed rates well below 4 percent, qualified first-time buyers should be more active participants than what they are right now.”
One way to protect yourself from rising rents is to lock in your housing expense by buying a home. If you are ready and willing to buy, let’s meet up to determine if you are able!