In some areas, landlords faced with multiple rental applications are seeing some offer more rent or a higher deposit in hopes of upping the chance they’ll get the unit.
NEW YORK – Bidding wars have become more common in the rental market because demand for apartment and single-family rentals has surged and outpaced supply.
With would-be buyers priced out of the housing market and more people moving out of shared living situations, many are seeking out rentals. Some landlords have seen more than a dozen applications for good properties, and renters are offering well above the asking rent.
“We’ve been leasing property for almost 20 years, and we haven’t seen an applicant pool this competitive since we’ve started,” says Vipin Motwani, managing principal at Iron Gate Development in Maryland. “The rental applications that we’re getting right now, you’re seeing higher credit scores, you’re seeing applicants willing to put down more in terms of security deposit, you’re seeing strong rental history as well. That wasn’t necessarily the case pre-COVID-19.”
Zumper, a national rental listing platform, indicates that rents nationally rose 7% year-over-year in July for one-bedroom apartments and 8.7% for two-bedroom apartments, up from 5% and 6.5% annual gains in June.
For single-family rental homes, the latest read from Corelogic in May showed rents up 6.6% year-over-year – nearly four times the annual increase seen in May 2020.
“Strong job and income growth, as well as fierce competition for for-sale housing, is fueling demand for single-family rentals.” says Molly Boesel, principal economist at CoreLogic. She expects these factors to continue to drive the market this year, especially in and around cities and technology hubs as people start to return to offices.
Source: CNBC (08/11/21) Olick, Diana; Rizzolo, Lisa; Dhue, Stephanie
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