Last week my dad talked about the upward trends in the rental market. Well since then the numbers have been getting even crazier, almost to the point of jaw-dropping! What is especially interesting is the huge demand for traditional single family homes. Now be forewarned, we only can track rentals that are advertised through the MLS, which here in Maricopa County is probably less than half of all the rentals available. The rest are marketed through places like craigslist or rentals.com. Still, we can get a pretty good idea of what’s going on in the rental market by watching the MLS numbers.
This time last year there were 2,760 listings available. Today there are only 1,988. That’s almost a 30% drop in the available supply. On top of that, Rental prices are surging. The average rental price on MLS this time last year was $1,598. Today it is a whopping $1,971! That’s about a 20% increase in value!
Summary: Landlords be feeling good! Tenants… not so much.
What does this mean for homeowners and potential buyers? A lot. With only a 25 day supply of available rentals in the valley, increasing demand for single family homes to rent, and rental prices surging, it’s not difficult to imagine a whole host of would-be-renters drawn toward becoming a buyer. We have already seen an improvement in the residential for sale market in the last month, but we feel even better times may be ahead.
Sellers: The buyer drought seems to be over for now and it may be time for you to get back in the game.
Buyers. Increase in demand and decrease in supply makes for rising prices. Don’t forget that with an improving economy interest rates rise as well. It seems as though the best days of the buyer’s market may be nearing its’ end. You may want to think about making your move before the sellers’ market is in full swing and you have to start competing with other buyers again.
Thank you to Michael Orr and the Cromford Report for all the statistics used here in.