The supply of rental properties is as short as it’s been in decades.
The U.S. rental vacancy rate — the percentage of rental units available — dropped to 6.8 percent in the second quarter of this year, according to data released Tuesday by the U.S. Census Bureau. That’s down from 7.1 percent the prior quarter and from 7.5 percent one year ago.
Using comparable data, the latest figure is also as low as the U.S. rental vacancy rate has been since 1985, according to Bloomberg Business.
Rent prices have continued to climb as the vacancy rate has continued to fall. Census Bureau data show that the median asking rent for vacant rental units was $803 during the second quarter — the highest it’s been in decades.
Experts predict that the smaller supply of rental properties will continue to drive rents higher.
Bloomberg reports that Neil Dutta, head of U.S. economics at Renaissance Macro Research in New York, wrote in a note to clients:
“Rental inflation is not going away anytime soon.”
Ed Stansfield and Andrew Hunter, economists at Capital Economics Ltd. in London, wrote in a note to clients:
“Our forecasts that rents will grow at an annual rate of 5 percent both this year and next would represent the fastest rate of rental growth since the 1980s.”
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