The monthly survey of nationwide rent prices by real estate website Trulia has found that nationwide rent prices are rising. More people are deciding to rent rather than buy, which has in turn led to apartments and rental homes getting more scarce.
Rent closer to being too high
In 2010, a video from a New York gubernatorial debate went viral, thanks to the presence of the wonderfully colorful Jimmy McMillan, head of the Rent is Too Damn High Party, whose campaign slogan is “the rent is too damn high.” He appeared in a later video proclaiming that “Charlie Sheen is too damn high.”
Jimmy might be on to something. Though McMillan had the notoriously high rent prices in New York City in mind, the sentiment might be shared by people in many more areas. A recent survey of nationwide rent prices by real estate website Trulia, according to Time magazine, found that nationwide rent prices rose by 6 percent over May of 2011. Trulia tracks the rents in large metropolitan areas, of which only one in the 25 largest, Las Vegas, Nev., declined in price over last year.
West coast rose the most
Of the top 10 largest increases in rents in the cities Trulia tracks, four were in cities located on the west coast of the United States, according to a press release on MarketWatch. Two were in New England, two were in the south and two were in the Midwest.
The two largest increases in rent prices were observed in San Francisco and Oakland, Calif., which had rent price increases of 14.4 percent and 11.4 percent, respectively. The two other cities west of the Rocky Mountains to have rent prices go up in the top 10 largest increases were Seattle, Wash., and Portland, Ore., which had rent increases of 9.6 percent and 6.8 percent, respectively.
However, Trulia also found that the asking price of homes had risen much more slowly in the same period, according to the Huffington Post. Home prices in the largest 100 metropolitan areas, which Trulia tracks in its surveys, actually decreased by 0.2 percent since last year. Only 41 of the largest 100 cities in Trulia’s most recent home prices survey had price increases.
Rent to keep going up
Part and parcel to rent increases is less rentals to go around, due to more people electing to rent instead of buy. Despite buying being cheaper than renting in most areas nationwide, fewer people are electing for mortgages and the subsequent decades of paying off debt. According to NPR, Census data reveals that more people are pushing the purchase of a home further into the future, as fewer than 40 percent of people under age 35 owned their home in 2010, though fewer than 45 percent did so in 2004 and just over 40 percent did so in 2000.
Not only that, but the number of homes purchased for investment purposes rose to 25 percent last year, according to Time magazine, a 65 percent increase from 2010.