With the U.S. homeownership rate falling to its lowest rate since 1967 in July 2015, this has been a banner year for many rental property owners, with vacancy rates at their lowest since 1993, according to a new inaugural rental report by All Property Management, a Buildium subsidiary. The rental market in the U.S. reached $ 173 billion in 2016, and although rents rose significantly, they still increased at a lower rate than that of the median U.S. home price. In addition to these market statistics, some of the results from this year’s report include:
The top five performing metros for the past year include: San Francisco, Calif.; Seattle, Wash.; San Jose, Calif.; Louisville, Ken.; and San Diego, Calif.
The Western U.S. is currently the best region for rental property investment, thanks largely to the impressive rent increases and property value appreciation found there.
Worcester, Mass. had the lowest vacancy rate with 3.05 percent, and Birmingham, Ala. came in at the bottom spot with a 17.67 percent vacancy rate. The percent change in median rent was best in Buffalo, N.Y. at 16 percent and worst in Hartford, Conn. at -6 percent.
“Our inaugural report was created to serve as a valuable resource for real estate investors, property managers and landlords throughout the U.S.,” says Michael Monteiro, co-founder and CEO, Buildium. “Our team compiled data from a variety of sources to bring together the most useful information and help those in the real estate industry source new properties and to help in setting rents and fees, assessing value and benchmarking performance.”
The report also looked at other factors pertaining to the quality of real estate investments. Some additional data points include the capitalization rate, or the comparison of median rental prices to median property values (Dayton, Ohio had the highest percentage at 13.15 percent) and property appreciation, where San Francisco, Calif. had the highest percentage at 7.34 percent. The report also looked into job growth (San Jose, Calif. had the highest growth at 19.11 percent), days on the market (San Francisco, Calif. had the lowest number of days at 33) and future rental availability, where Austin, Texas experienced the best percentage at -1.47 percent. Finally, the research also included data on job availability, where it compared population numbers to current job openings (San Jose, Calif. had the highest availability at 36), and the cost of insurance premiums and property taxes, where Salt Lake City, Utah came in with the lowest cost.
For the full Rental Ranking Report, visit http://www.allpropertymanagement.com/rental-ranking/