If you are thinking about finding a home for rent in Scottsdale, becoming familiar with the current rental market is a good idea. This can let you know what to expect before you start touring the rental homes you’re interested in, only to find that they’re out of your price range or will not be available for much longer. Here’s what you need to know about the rental market, both in Scottsdale and the US as a whole.
The rental market in Phoenix
If you’ve been looking for a rental home in the Phoenix area, you’ve probably already noticed the shortage of available houses. According to The Cromford Report, there have been just over 12,000 new rental listings for 2016, which is a 13 percent reduction from 2015. This trend has actually been going on for a few years, with rental listings having decreased by about 37 percent since 2013.
What’s behind the shortage of rentals?
One of the main issues causing the rental shortage is the lower than average inventory of houses, especially multi-family homes that are usually rented out. Over the last few years, developers have not been as confident as they once were, resulting in them borrowing less money and therefore building fewer housing developments. This has led to fewer homes for renters to choose from.
Add to that the fact that there are more people renting in recent years, and you can understand why the rental housing market is so competitive. In fact, the rate of homeownership in the US has dropped to about 63 percent. That number is normally closer to 65 percent and up. In addition, the rental vacancy rate nationwide is a pretty low 6.8 percent lately, so you can see why finding a rental home in Scottsdale might be a challenge right now.
What are the consequences of the rental shortage?
One of the most obvious results of this shortage of rental homes in Scottsdale and beyond is the increase in rental prices. Landlords can simply charge more now that their rentals are being snapped up faster than ever. This has led to renters spending more on housing than they should be.
More specifically, about half of renters now spend 30 percent of their income on rent, and one quarter of renters spend 50 percent or more of their income on this bill. In North Scottsdale, the average rental price is now about $1,073 per month, while it’s about $1,051 in South Scottsdale and Old Town. That’s an increase of 7 percent.
Rent has increased even faster in other areas, such as Phoenix. For example, it recently increased by over 14 percent in the Camelback area. The rental rates in central and downtown Phoenix have jumped by about 12 percent, with average rent being $1,256 monthly, thanks to some new luxury developments in the area.
What can renters do about it?
If you’re having trouble finding a rental home in Scottsdale, you can enlist the help of local Realtors whose knowledge of the market will be an asset. After all, in a competitive rental market like this, simply looking for homes for rent on real estate websites is not usually enough to find one, since vacancies are getting filled before they are even listed.
Of course, this might be the push you need to buy a home in the Scottsdale or Phoenix area. This would be a great year to do it! Interest rates are still very low and are expected to remain that way for most of the year, and there are many home loans that don’t require the traditional 20 percent down payment. So if you’re interested in finding out more about buying a house in Scottsdale, contact The Matheson Team today!
Realtor | Founder
The Matheson Team – RE/MAX Fine Properties
21000 N. Pima Rd., #100, Scottsdale, AZ 85255