It seems as though all the talk surrounding the real estate market these days pertains to rising home prices and a lack of inventory. While this focus is for good reason, the rental market also continues to experience robust growth and its own inventory challenges in certain areas. In particular, the detached, single-family home rental market is red hot! Not surprisingly, many buyers and renters have been opting for detached, single-family homes in their quest for more space. Whether it is due to a virtual work or school environment, social distancing, or all of the above, the desire for additional space has been consistently seen among both buyers and renters.
What the data shows
According to a recent CoreLogic report, the U.S. experienced the largest annual rent price increase in 15 years for single-family homes in April. In fact, single-family rent prices increased 5.31% year over year in April, up from a 2.4% increase in April 2020. Detached homes saw the biggest price increases with average rental price increases of 7.9%, while attached home rental prices rose by 2.2%.
According to Mollye Boesel, principal economist at CoreLogic: “While rent growth slowed last April at the start of the pandemic, the rate of rent growth this April was running above pre-pandemic levels, even when compared with 2019, and shows no signs of diminishing.”
Inventory constraints and rising affordability issues continue to plague the for-sale housing market. In addition, a particularly large aging millennial demographic is continuing to place additional pressure on the single-family home market as a whole. These factors are essentially having a spillover effect into the single-family home rental market. Many frustrated buyers that are missing out on home purchases are opting to rent instead. This is adding even more competition to the single-family home rental market.
A recent survey by CoreLogic found that 49% of millennials and 64% of baby boomers “strongly prefer” to live in a single, stand-alone home. This is a significant finding given the large proportion of the real estate market that these demographic groups represent. If you are in search of a single-family rental home, the strategy should not be any different than it would be for a home purchase. A tight inventory combined with strong demand means that you should act swiftly. It is strongly recommended that you are represented by a real estate professional and that listing alerts are set up in order to be notified as soon as a potential property hits the market. Tools such as the “Florida Home Search” app by Live South Florida Realty, Inc. will allow you to set up these alerts right on your smartphone or tablet. Simply download the “Florida Home Search” app from the Apple App Store or Google Play Store today!
Are you looking to buy, sell, or rent a property in South Florida? We can help. Contact Live South Florida Realty, Inc. today!