According to data from real-estate research firm, Reis Inc., average monthly rent for U.S. apartments increased to $1,099, a 0.8% increase from the first quarter. The rising rent, a sign of economic recovery, has been most obvious in West Coast cities like Seattle, San Francisco and San Jose. Also posting strong growth are some eastern cities such as Charleston, Nashville and Palm Beach. However, household incomes are lagging behind rent growth.
In addition to increased rent, there has been an increase in demand for apartment rentals. One reason for this is younger renters’ desire to live in urban areas. Also, the new, strict lending standards for mortgages have been forcing once potential homeowners to rent instead. The rate of apartment vacancies remained the same nationally indicating that the supply of apartments may be catching up with the increased demand and that rent growth has the potential to stabilize.