Rent prices continue to grow, but pace slows

In August, for the eighth month in a row, the U.S. average apartment rent reached an all-time high.

In August, rents averaged $1,220, an increase of $3 from July, according to Yardi’s Matrix Monthly. On a year-to-year basis, rents increased 5 percent in the 120 markets analyzed.  However, the rate at which rents are rising has decreased over the past few months. Across the country, rents rose .5 percent since June.

Overall, rent in “technology-centric areas,” such as San Francisco, Denver, Austin and Boston saw a decrease in rent growth, according to the report.

“Even though overall rent growth is cooling, fundamentals in most of the country remain strong. Occupancy rates have declined slightly, but they remain extremely high across the country,” the report stated. While job growth has decreased slightly, the demand for apartments is still high.

However, 60 percent of the top 30 metros have seen “solid” growth between 4 and 7 percent over the past 12 months, especially in Sacramento, Seattle and Inland Empire.

Growth for “renter by necessity” properties was higher (6.3 percent) than properties for renters by choice (5.6 percent). Renter by necessity can be a young-professional couple who do not have the means to purchase, students, lower-to-middle-income families, blue-collar households, subsidized households and military households. Renters by choice are defined as having the wealth to purchase, but instead choosing to rent.

Stabilized renter by necessity (96 percent) and renter by choice properties (95.5 percent) are both near historical highs and have dropped only about 10 basis points in recent months, according to the report.