Rental demand continues to skyrocket and with it rental prices have risen dramatically. The average lease price for an active rental listing in the Arizona Regional MLS is now at $2087 per month, which is 11% higher than last year at this time. Recently there were only 2,140 home listings available on the MLS, a veritable dearth of inventory. The all-time low, per Michael Orr of The Cromford Report, was a couple weeks ago when there were just 2090 rental listings available.
To give perspective on this problem (yes, it’s a problem), back in 2008, there were close to 10,000 MLS rental listings available. The current count for rental listings is 27% below last year and 45% less than 2014.
The average leased price per square foot is currently 79.1 cents psf, while last year it was 71.7 cents psf. That represents an annual increase of over 10%.
So, what’s a Renter To Do?
So, what’s a renter to do if they can’t buy a home yet and they don’t want to move? Can they avoid a landlord’s annual rent increase? Not always, but here’s our advice: Be Nice! Being a really good renter can sometimes soften a landlord when it comes time to consider raising rents.
I have some clients who began renting their Scottsdale investment property to some folks over 15 years ago. The same people are renting the house today with few rent increases because they were nice and my clients liked them.
What is my definition of nice?
1) Be on time with your rent! (Yes, this is obvious, but it goes long in the goodwill department) If there is a month where there’s a rent shortfall, send what you can with an explanation of why, and that you’ll get caught up next week, or whenever. Some rent plus timely communication will go a long way for you. And then do it!
2) Don’t sweat the small stuff! If you can fix something yourself at little to no cost, do it! Landlords don’t like renter phone calls for the minutia. Look at it this way, if your rent is $1500 per month and you’ve had to fork out $150 yourself over the past year on small stuff, that’s cheap considering a 5% rent increase (which totals $900).
3) Keep your yard, especially your front yard looking great. Mow the lawn, pull the weeds, plant flowers. Hey, you’ll enjoy it too!
4) Be a good neighbor. Often the neighbors are connected to the landlords. If you’re a renter who gets along with the neighbors, this may aid you come renegotiation time. And if not, your neighbors will really like you.
5) Every three months or so, let your landlord or property manager know that you’re taking care of the place. Mail them a front yard photo of the house with a short note telling them you’re really enjoying their home. “Oh, and by the way, Mr./Mrs. Landlord, we took care of that leaky bathroom faucet — just needed a washer.”
You get the picture? And if you still can’t stop the annual rent price spiral? Get into the ownership side of the game. That’s where you need to be anyway.