National Apartment Rents Reach All-time High; Denver a Must-watch

Revision: A quarter way through the year, Yardi Matrix revised its forecast for rent growth by metro. Overall, national rent growth is still expected to hit 4.4% in 2016: a solid gain but down a bit from 6.3% in 2015. However, the distribution by metro has changed, hence the forecast numbers in our snapshot below have changed as well. Of the Matrix Monthly top 30 metros, growth forecasts were downgraded in 13 markets, increased in 11 markets and kept the same in 6 markets. See RentCafe’s apartment market snapshot for March 2016 for the revised data.

The latest Yardi Matrix Monthly report shows that apartment rents have hit an all-time high yet again, with the national average jumping $7 in February, from $1,168 to $1,175 per month. That marks a 0.6% jump month-over-month and a 5.9% increase from the same time last year. As January saw a year-over-year jump of 6.4%, it seems rent growth may begin to moderate in 2016, perhaps inching closer to the projected annual increase of 4.5%.

Other highlights of the Matrix report include:

• Denver is expected to take the top spot in rent growth this year, with a projected jump in rent prices of 11.2% by the end of December. That puts it ahead of every major metro we monitor, including last year’s top performers – Portland and San Francisco.
• Metros heavy in the energy sector are seeing drops in rent growth, particularly Houston, Pittsburgh, and Atlanta. The sinking price of oil, as well as layoffs and decreasing job growth in these areas, likely plays a big role.
• The highest amount of rent growth for February was seen in Western metros, including Portland, San Francisco, Denver, Sacramento, and Seattle. Small Western markets like Reno, Tacoma, and San Fernando also saw big jumps.

Let’s take a look at what the nation’s average rent can get you in some of these in-demand cities now.

Denver

On the Southeastern side of Denver, you’ll find Virginia Village, a conveniently located, bustling neighborhood where shopping, dining, and outdoor activities abound. Live in the area’s Mint Urban Infinity, and you can get serious bang for your buck, too. For just $899 a month, you can get a 2-bedroom, 1.5-bath apartment home with 870 square feet of space. Amenities at the newly remodeled community include two resort-style pools, two fitness centers, a dine-in movie theater, a dog park, a yoga area, and even complimentary coffee daily.

San Francisco

Over in the Western part of San Francisco is Hayes Valley, a trendy, hip neighborhood with all the best shopping, restaurants, and nightlife. It’s also home to the Hayes Valley Apartments, where you can get a spacious 2-bedroom for just a little over the national average rent. For $1,465, this community offers a 2-bedroom, 1-bath unit with energy-efficient appliances, intrusion alarms, and stunning views of downtown. The complex also has private garages, an on-site daycare, a park and learning garden, a complimentary lunch program, and free Wi-Fi.

Portland

Located in Southeast Portland, the Mount Scott North neighborhood is a popular spot for singles and young families. It even boasts a community center complete with an indoor pool, water slides, a roller skating rink, an indoor playground, and more. It’s also the home of Scott Mountain by the Brook Apartments where, for under the national average ($1,080) you can get a roomy 1-bedroom, 1-bath. Willing to pay a little more? For $1,285, you can upgrade to a 2-bedroom, 2-bath unit instead. Either way, you get access to the complex’s outdoor sports court, playground, coffee bar, fitness center and sundeck.

To learn more about these properties or find others that fit your taste and budget, visit RentCafe.com.