Rent is at highest pace in six years

With national vacancy rates for rentals at the lowest percentage in 20 decades, landlords haves been upping the price of rentals by the fastest pace in six years, according to MarketWatch.

The Bureau of Labor Statistics reported that annual rent inflation hit 3.3 percent in October, and continues to grow. November marked a 3.5 percent growth in annual rent inflation, which is the most growth in six years, since November 2008. Comparatively, total consumer inflation was up only 1.3 percent in November.

The U.S. Census Bureau reported that vacant rentals are at the narrowest proportion since 1995, with only 7.4 percent of rentals being vacant.

With fewer vacancies available, landlords are able to charge more for the demand of their properties.

Additionally, there’s an under supply of single-family houses and apartments to rent for the first time since 2001, according to an analysis by Frank Nothaft, chief economist at mortgage buyer Freddie Mac, based on available inventory and historic vacancy rates. The deficit in the third quarter was about 350,000, the most in records dating back 14 years.

Nothaft predicts that demand will continue to exceed product, and rental markets are expected to remain tight in most urban markets for 2015. Multifamily mortgage originations have risen about 60 percent between 2011 and 2014, and further increases in volume are anticipated in 2015, he reported.