If you live in an apartment, you migggghhhttt want to think about renewing your lease next year despite that often-inevitable hike in rent. The reason? You might not have anywhere else to live.
According to a new report released from RealPage, the US currently has the second highest rate of rental occupancy ever, with 96.5% of available apartments already full (the highest rate ever recorded was 96.8 in 2000).
Basically, what that means is that we’ve got way too many people wanting to rent and not enough available space. RealPage’s Vice President of MPF Research, Jay Parsons, told Business Insider, “You have an awful lot of young adults who are in a stage of their life where renting an apartment makes sense.”
So why the lack of options for them? Welp, in a nutshell, millennials aren’t buying their own homes, meaning they’re not moving out to make way for new renters. “With loss of renters to home purchase below the historical norm, the limited churn of residents is helping to keep the occupied apartment count high,” said Greg Willet, the site’s chief economist.
That’s bad news for those seeking to rent, because it ultimately means you’ll be paying premium pricing for a place that might be less than ideal.
Rent for new residents has risen 1.5% in the last quarter alone, with an average monthly rent now coming in at $1,292 — a stat that’s even higher in America’s most popular cities. Um, yikes?
What’s more, we may be stuck in this sitch for quite some time, considering the building prospects — they aren’t looking so hot. Land is getting more expensive, worker strikes are driving labor costs up and building materials are getting pricier, and it’s just not profitable for developers. “Our national housing policy is very much geared towards stimulating home purchases and not supporting renters, so we just aren’t building hardly any of the designated affordable, income-restricted housing where there’s just an awful lot of demand,” Parsons said.
So what’s a gal (or guy!) in a pinch to do? As a recent NerdWallet study found, it might be time to look at your options a little more closely, summarizing, “Millennials — and first-time homebuyers in general — should never just assume they can’t afford a home. The first step to owning a home is knowing how you can finance it, so you should always research your options.”
Hey, we’ll take any advice we can get!
Are you nervous about your upcoming renting prospects? Talk it out with us @BritandCo!
(h/t Bustle, photos via Getty)