The National Association of Realtors has great articles about the market shift going into renting vs owning and how that is pulling the vacancy rates lower. They site National figures, however the Twin Cities is showing even lower vacancy rates than the national average. This brings us to the law of supply and demand, rents will go up as supply goes down.. Which leads us back to age-old question: RENT VS OWN?
…The latest census data, which measures rentals of both single-family and multifamily units, report a 9.2 percent vacancy rate, the lowest since 2002. Private sector data from REIS on just multifamily units at mid-to-large cities in the U.S. fell to a 5.5 percent vacancy rate.
…According to the rent component of the Consumer Price Index, rents rose by 2.1 percent as of September from 12 months ago, after no rent increase in 2010. Most economists are calling for a further rise in rents in 2012, simply because of the very low levels of construction of apartment units.
Rising rents mean a better rate of return for real estate investors. Rising rents also mean more renters will be pulling out calculators to see if it makes more sense to buy a home.
Try out your scenario on this RENT VS. OWN CALCULATOR.
- Falling Rental Vacancies (economistsoutlook.blogs.realtor.org)
- To rent or not to rent? (michaelwliew.wordpress.com)