In order to properly navigate the current real estate market, an appreciation for the chronic shortage of inventory available for sale just isn’t enough for the demand out there. There is also the necessity to recognize the impact that rental shortages will play in the coming year as it affects home sales.
According to CoreLogic, apartment rental occupancies are super hot witat an all-time low in 2019. This has produced a significant rise in the prices the renters pay to rent a single-family home. And as these rental prices rise, so will the overall asking prices of homes for sale rise proportionately.
In the third quarter of 2019, single-family rental costs rose by 3% on average in a single month from August to September. Now this did not impact the cost of single family rentals on a year-to-year basis but simply over the course of a 30-day period.
Some markets over the course of a year saw some significant surges: Phoenix, Las Vegas and Seattle led the way with rent increases of 6.7%, 5.8% and 5.5%, respectively. Even Detroit showed an increase of 2.2% year-over-year.
Many of these markets are showing continued and ongoing physical strength. The robust economic climate continues to support real estate markets nationwide. This is underscored by the long performance report published recently by CoreLogic which indicated that serious delinquency rates have continued to fall to levels of 1.5% of all mortgages. The strong employment rates and the increase in family income continue to support the rental and purchase markets. This explains why from 2016 to 2017 over half-a-million borrowers refinanced FHA loans to conventional loans, reflecting a stronger economic footing.
If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.
Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.
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