Across the United States, it isn’t difficult to see why rental property management is an important opportunity for many investors. Rental property not only offers many Americans the housing they need, but also gives property owners the ability to collect regular income on an investment that is usually more stable than stock market shares. Moreover, with the help of reputable rental property management companies, most property owners can be sure that their properties will be properly maintained and managed, guaranteeing consistent profits and happy tenants. Unfortunately, many people are wary of making this type of investment, especially in the wake of the housing bubble and the recession. But a new report suggests that these concerns may be preventing many Americans from accessing an excellent opportunity for success: studies show that national rental home rates are rising.
According to Real Property Management and RentRange, two rental property management services, the average monthly rent for single-family homes in the U.S. was $1,286 in the first quarter of 2015. This not only represented a 5.4% year-over-year increase, but was part of a nationwide increase in rental rates. The Pacific and Northwest saw the greatest improvements in this area, with 13% and 10.9% year-over-year increases. However, even the areas on the other end of the spectrum, the Mid-Atlantic and South-Atlantic regions, still saw some growth, with increases of 1.6% and 2.6% year-over-year, respectively.
The increasing rental rates are believed to be the result of two factors: a growing focus on renting and a low vacancy rate, which increases competition for available properties.According to the two companies, the national vacancy rate rose slightly to 5.7% in the first quarter, a 0.9% growth year-over-year. However, the percentages varied significantly by region: for example, the vacancy rate was reportedly highest in the Midwest, which has a 7.2% vacancy rate, and lowest in Texas, at 3.6%. This information can help regional property managers determine the best course of action for properties in their area: for example, rental properties in the Midwest will likely require more attention to maintenance and rental property management services than those in Texas, where there is less competition.
Real Property Management and Rentrage admitted that they limited their study to three-bedroom single-family homes, which only provides a small window into the U.S. rental property market. However, with research showing that 23.4% of single-family homes are rented and Americans are still focused on renting, the companies say they only expect the increasing rental rates they have noted to continue. Should you take advantage of this thriving market? Contact a rental property management company near you today to find out!