I ran across this article on WASHINGTON (FOX 5 DC). Working in Property Management , it seems as if people would rather rent until they find a home that they would love. Has anyone seen an up tick in rental applications in their market!
What are your thoughts on this article?
I've never seen rental demand as bad as it is now!
I get calls/emails daily. Our houses are often rented before renovation is done, or before the other people move out (both leases start when it's vacant), so I'm sure if it's happening with us, others have the same experience.
A lot of landlords got burned from the eviction moratorium ( I know one guy who didn't get rent for 10 months!) and sold their houses, or they are just ready to exit and with housing prices so high, it's now the time to sell-- both of which put tremendous pressure on the rental demand! The pandemic also held back everyone who wanted to move last year, so yeah.. it's a perfect storm for rentals now, I feel bad for anyone moving now!
@Linda S. , That makes sense. I'm the Business Development Manager for a property management company in Alexandria VA, and I have Owners and Landlords tell me horrible stories about how burned out they are and they don't want to deal with it anymore. Especially the ones they can't legally evict due to the pandemic.
I can attest to a tight rental market both in Nashville, TN and Baton Rouge, LA. In Nashville, fortunately for renters, they're throwing up multi-families like crazy. Tough to find any decent SF dwellings though. BR doesn't have anywhere near the volume of MF's, which makes finding tenants a bit easier for me at least.
Rents and demand are down in the DC area. Mostly in the district, but the suburbs are also a little soft.
I'm currently househacking in NoVa, I was looking for a new tenant about two months ago and I noticed that there was a ton more demand than a year ago. I readjusted pricing and also raised rents a little. Other househackers I have talked to are experiencing the same, you can fill rooms pretty quickly and usually getting a bit more than expected.
The Toledo rental market is also crazy. We have been able to push rents across the board, and people have rolled the dice with significant increases on nicer C and B properties and are still getting leased. However, Toledo isn't as densely populated so we didn't have a "flight" out of town with Covid, there are SFH all over Toledo.
I would have to agree with @Linda S. I have been in this industry for over 10 years and have not seen the rental demand this high. Friends of friends, friends of family, random individuals all reach out to me requesting a rental and all I can do is direct them to the best PM companies I know in hopes they have availability. What ends up happening is that the prospect either doesn't get a rental or settles for an area or home that doesn't meet their needs. As @Reid Chauvin pointed out, here in Orlando there are apartments being built everywhere, in addition, investors are purchasing value-add MF's and turning them around increasing value in the community.
As far as being burnt out, PM can be very draining but it's all in how you handle it. Building new processes and enforcing them, working smarter not harder, and keeping a positive attitude will get you through any challenging role. There are hundreds of other career paths that are just as draining, so it's important to get with a PM company who is willing to try new procedures that are good for both the tenant and the PM company/client.
@Russell Brazil , I have a few clients that used to live in DC, now they're moving out to the suburbs because of the pandemic. Years ago, people wanted to get close to DC as possible because of work and commute. But since the pandemic, a lot of people are working from home or hybrid. I wouldn't mind living out in the suburbs of VA or MD if im only commutiung 2-3 times a week.
@Ashley Herring , Yes, I agree! I feel that since prices for buying are so skewed, people are realizing they maybe paying too much for their homes, so they will sell and rent for a year or so and get back in the market. Im actually originally from Orlando! Yay!!! You are correct. There are apartment building everywhere! The landscape is very different here in the DMV area. We have some larger cites in Maryland where you can count on one hand how may apartment complexes there.
@Joaquin Camarasa , that's awesome! do you manage the properties yourself?
Originally posted by @Tyler Clark :
@Joaquin Camarasa, that's awesome! do you manage the properties yourself?
I do for now, in our area unless you rent by the room, there is no way to cover your mortgage. I plan to keep buying properties close to me so I can keep buying and renting by the room for the upcoming years. My hope is that with inflation and rents going up I will get to a point in which I can rent the whole house and make some cashflow that is exactly what happened in the property I describe below.
I have another property that we rent by the room in Denver, I bought it with a friend 4 years ago. My friend is there and manages it, he lives for free and we split profits I realized its impossible to rent by the room and manage it yourself if you are not close by. For my peace of mind, out of state investing is not for me.
In Vegas the rental rates for my 3 renewals between august 1st and November 1st went from $1325, $1395, & $1425 to $1800-$1850. Biggest rent increases I’ve seen in Vegas since the Great Recession.
I was planning on doing a 1031 with the increased values but suddenly the increased rents make that a hard decision. Those 3 properties are now bringing in the rent of 4 properties last year.
Originally posted by @Tyler Clark :
I feel that since prices for buying are so skewed, people are realizing they maybe paying too much for their homes, so they will sell and rent for a year or so and get back in the market.
Considering that the general public is awful at timing markets, this should bode well for continued increasing home prices.