As I’ve pointed out over the past several months, the residential leasing market has become slanted towards the landlords.
This is a result of several factors, of course, including:
-the insane rate of condo conversions (see also: More about Condos vs. Apts, Condos reverting to apartments, Stronger Market for Apartment Investors, & New Hilton Hotel redevelopment of Miller & Rhoads)
-the slowing of the economy (however slight it may be)
-the increased mortgage rates (see also: Residential rates highest since 2002)
The Wall Street Journal just ran an article about the shift in the residential leasing market. Here is the synopsis posted by REALTOR Magazine Online:
Bidding War May Be Moving to Rental Front
The country’s apartment sector is seeing
more bidding wars as tenants jockey for available rental units in
increasingly tight markets.
Nationwide, rent for a 1,000-square-foot
apartment has risen 3.7 percent in the last year to $1,389 a month,
says Property & Portfolio Research Inc.
One of the main reasons for climbing rents
is the reduced inventory of units, created in part by developers that
built condos or converted rental stock into for-sale units during the
home sale boom.
In the second quarter of this year, rental
vacancy rates fell to 5.3 percent from 6.2 percent in the year-earlier
period. This has produced what is known as a "landlord’s market," with
companies like AvalonBay Communities Inc. raising their asking prices
and cutting concessions for incentives like a free month’s rent.
—Wall Street Journal, Christine Haughney (10/11/06)