Apartment Rents Climb Faster in Metro Phoenix than Anywhere in the U.S. Article originally posted on AZ Central on March 22, 2019
Apartment rents climbed faster in metro Phoenix than anywhere in the U.S. during the past year.
The average monthly cost to rent in the Valley jumped 8.1 percent, more than twice the rate U.S. rents climbed.
That increase added $103 to the average apartment renter’s monthly bill, according to national apartment research firm RealPage.
The U.S. average rent climbed by 3.4 percent, or $60 a month, during the past year.
The recent rent hike comes after almost five years of similar increases for apartment dwellers in the Phoenix area.
Many Valley renters whose incomes aren’t keeping pace are feeling squeezed as there are fewer affordable options. Some have opted to find more roommates.
More than 46 percent of Phoenix-area renters pay more than 30 percent of their income for a place to live, according to the national study from the Joint Center for Housing Studies at Harvard.
The threshold for whether someone can afford a rent or mortgage payment is if it costs them less than one-third of their income.
Too many luxury apartments?
More than 8,000 apartments were built across the Phoenix area last year, and another 8,500 new ones are expected to open to renters this year.
But most – about 87 percent – of all the new apartments are luxury with rents averaging much higher higher than $1,000 a month that almost half of all Valley renters can afford based on incomes.
If the new apartments don’t fill up because not enough people can afford them, then rents could dip.
“It will get harder to maintain sky-high rent growth in Phoenix as apartment building activity continues at an aggressive pace,” RealPage Chief Economist Greg Willett said.
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