Average rental prices have ticked up nearly 4 percent nationwide, according to the latest TransUnion Rental Screen Solutions industry report of data collected from property managers in September 2012 and September 2013.
Rents were on the rise for all four of the classifications of rental properties that TransUnion analyzes: newer institutional properties; older institutional properties; older properties in less desirable areas; and older properties in less desirable areas that are in need of renovations/updating. Average rents of all four types was $1,072 in 2013.
The largest rental increases were seen in properties that were in less desirable areas that need renovations, up 4.2 percent to an average of $693.
“The rental market continues to be strong as demand for rental units remains high while consumer credit risk slowly improves,” says Michael Doherty, senior vice president of TransUnion’s rental screening solutions group. “The combination of improving rental risk scores and continued demand for rental properties is particularly good news for property managers. … When the credit risk of the population improves, property managers may be more inclined to tighten their criteria to ensure they are getting the best possible resident. This is integral because a resident who ‘skips’ out on a lease can cost a property manager thousands of dollars in lost revenues.”
Source: “Good News for Rental Markets as Prices, Renter Credit Quality Both Rise,” Mortgage News Daily (Jan. 27, 2014)