Tag: rent

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Financial Real Estate

Single-Family Rents Rise Most In At Least 16 Years

Single-Family Rents Rise Most In At Least 16 Years

Rent on single-family homes rose by 12% from December 2020 to December 2021, which was more than three times the previous increase. It was the largest year-over-year increase since the CoreLogic Single-Family Rent Index started tracking rental data 16 years ago, and while the index growth managed to slow over last summer, rent growth is still higher than pre-pandemic levels when compared with the data from 2019.

What is the Single-Family Rent Index?

CoreLogic’s Single-Family Rent Index, or SFRI, tracks changes among single-family rental homes using a repeat-rent analysis to measure the same properties over time. According to the SFRI, there were record increases in both low-price and high-price rental properties, which contributed to the overall gain.

Single-Family Rent Growth by Price Tier

Rent costs for the low-price tier, which is defined as properties with rent less than 75% of the region’s median rental price, increased 8.3% last year, up from 2.4% in 2020. High-price rentals, which are defined as a property with rent prices greater than 125% of the region’s median rental price, rose 11% last year, up from 2.8% the previous year.

Growth by Property Type

During the pandemic, more renters chose to live in standalone properties in lower-density areas. A detached property is defined as a free-standing residential building, as opposed to an attached property type such as a duplex, townhouse, or condo. Rent growth on detached rentals increased 12.2% last year, compared with only 7.8% for attached rental properties.

Growth in Metro Areas

Of the 20 metro areas shown in the SFRI report, Miami had the highest year-over-year rent growth with 25.7%. Phoenix followed at 19.8%, then Las Vegas at 15.9%. These likely increased due to tourism returning to normal as pandemic restrictions lift.

Chicago showed the lowest rent increase at only 2.8%. Boston, Washington D.C., Philadelphia, and New York also showed low rent growth of under 5%.

Why is it rising?

More and more people are in the market for rentals as consumers continue to get priced out of buying a home. Many families can’t afford to pay the increasingly high asking prices for the low inventory of homes for sale, so they resort to renting a single-family home instead.

Although 93% of consumers believe that owning a home is a good investment, competition in the housing market forces more buyers to remain renters instead. Single-family rental units are the most popular choice since people want more space for their families, and as the labor market improves, the demand for larger single-family homes will grow as well.

Since occupancy rates are at a record high, rentals will keep rising in price and may become more difficult to find. Rental unit vacancies have practically disappeared since when one renter gives notice to move out, another renter swoops in to take over the unit. Gone are the days when rental units are available, so rental owners can charge more due to increased demand.

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Debt Financial Loans

Can’t Pay Rent? Here’s Where To Find Help

Can’t Pay Rent? Here’s Where To Find Help

Hundreds of thousands of American tenants lost a critical legal safeguard when the countrywide eviction ban was repealed.

The United States Supreme Court recently overturned an eviction restriction. This now means that landlords throughout the nation to proceed with evictions without restraint.

The Eviction Ban is Over

Even while the federal moratorium was in effect, the eviction prohibition was not standard across the board. The moratorium was not enacted in every state in the United States. And not all tenants were aware of the order or how to benefit from it. Therefore, it didn’t reach as many people as it should have.

Although the federal eviction moratorium is no longer in effect, if you have been unable to pay your rent or your utilities due to the epidemic and are facing eviction, you may be eligible for a personal government bailout.

Rent Help Still Remains

Despite the Supreme Court’s decision to overturn the federal eviction moratorium, another program remains. A first-of-its-kind, $47 billion government rental assistance program, which covers energy bills and up to 18 months of rent for tenants who have been unable to pay due to the pandemic’s financial effects, is still in place.

The federal program has been hampered by regulations and rules and red tape and has been far too slow to get off the ground since its creation last year, but authorities are working to make it simpler for hard-hit tenants and landlords to collect money they are entitled to. There are many tools available to assist individuals in determining where and how to apply.

How to Get Rent Help

The Consumer Financial Protection Bureau has built a website where people may input their location. This way they can get contact information for the local organization that administers the assistance in their area.

Another website, run by the nonprofit National Low Income Housing Coalition, provides details on the 493 state and local agencies that distribute the aid, including which agencies allow renters to simply state that the pandemic has caused them financial hardship and that they have lost income, or that they meet other eligibility requirements. Applicants in certain states are required to provide papers. This includes leases and pay stubs to establish that they fit the criteria.

According to existing rules, roughly 750,000 individuals will be evicted throughout the country before the end of the year.

Conclusion

The rental aid program is the last remaining enormous protection for American renters now that the larger eviction ban is over. And many of the remaining state eviction bans are supposed to end by September. With evictions allowed to resume in an estimated 90% of the country by October, the need for financial help to millions is needed just as much now as before.

If the present rate of rental aid distribution continues, 1 million to 2 million families will be behind on their rent and without help by the time the remaining state eviction moratoriums expire.

Thankfully, the federal assistance program exists- although many people don’t know of it. People are calling on the federal government to do even more. They want them to assist people but so far there are no plans in Congress for such help.

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Financial Real Estate Savings

Rule of Thumb: How Much Should Your Rent Be?

Grab Your PopRule of Thumb: How Much Should You Spend on Rent

Now that winter has broken in many parts of the country, and it won’t be a punishment to move, people are heading to virtual rental tours in droves so look for new digs. But before you start cruising Zillow, Redfin, or other similar sites to look at your options, take a few minutes to figure out what you should be paying for rent.

The Short Answer Is 30%

Most experts agree that you should spend approximately 30% of your gross income. That’s before taxes are taken out. This means if you make $1,900 per month before Uncle Sam takes any, you should be planning on about $570 for monthly rent. Keep in mind that this is a general guideline and not a rule.

The major factor in how effective this estimate is is the cost of living in your area. While a simple one-bedroom apartment in the Bay Area or North Jersey could cost $2,000 or more per month, renters in rural areas of the midwest could see the rental of a 2 bedroom single-family home for less than $400 per month.

The 50/30/20 Method Works Well For Many

Another great method is the 50/30/20 split. This looks at your total take-home pay and splits it into three categories. This is 50% for your needs, 30% for your wants, and 20% for saving, investing, additional debt payments.

Your needs are expenses like insurance, broadband access, utilities, consistent debt payments, groceries, and of course, rent. Your wants are shopping splurges, dispensary trips or happy hour, concerts, and cosplay. For the last 20%, remember that you should only be keeping an emergency fund in a savings account, while all of your long-term savings should be invested in some fashion, so avoid inflation decay and begin building retirement income. If you have any debt, payments above the minimum should be in this category as well.

This means if you bring home $1,500 per month after taxes, your 50/30/20 split would look similar to this:

  • $750 for your needs
  • $450 for your wants
  • $300 for your future

The second and third categories are necessities, though in different ways than the first. You need a proper work-life balance, so if you can only afford to constantly work just to be able to eat, sleep, and work, your life can get bleak, fast. Make sure you make it a consistent goal to invest in your leisure, and your future.

With this in mind, you can get a really good idea of your rent payment by taking your $750 for needs, from our example, by starting with your relatively constant monthly bills, and working backward. For example, if broadband is $50, your groceries are $150 (I know, just pretend for our example), insurance is $35, and your minimum payment on your only high-interest debt account is $15, that comes to $250 in needs otherwise, so there’s $500 available for rent.