Oh My Apartment

The current economic situation has had some pretty clear influences on rental rates. For the most part, the cost of renting an apartment has been dropping and, in many areas, landlords are offering incentives to new tenants. Landlords are seeing the first major declines in five years.

A report from Reis Inc. points to last year’s fourth quarter as a turning point. That’s when the national vacancy rate hit a four-year high of 6.6 percent, and showed no sign of stopping.

That, in turn, led to dropping rents, down 0.4 percent from the third quarter. Landlords are seeing fewer tenants interested in leasing — those renters experiencing a personal financial crunch have been turning towards alternatives like roommates or, if they’re younger, moving back home with their parents. All of this adds up to an advantage for anyone looking to rent in the near future.

These numbers are simply averages, of course. In some areas, rents are expected to hold steady for the next year. However, most rent forecasts are predicting lowering rents—at least through 2009.

There are a variety of forecasts for after the end of the year, some predicting a major upturn in the housing market and others predicting a continuing decline. Some of the differences can be attributed to the number of new apartment complexes being built.

New apartment building has slowed significantly, but there are still many construction projects continuing, affecting the number of available apartments in many cities. The more apartments available—the more units sitting empty—the more willing landlords are to drop prices or take other steps to encourage new tenants to sign a lease.

If you’re considering hunting for a new apartment in 2009, you’ll have a strong negotiating position. It’s worth doing a little research into the average rent in your area: you can use that information to know just how low you can negotiate your rent. Check out the ApartmentRatings’ What the Neighbor’s Pay tool for assistance with this.

Don’t forget to look at the perks available, either. Many landlords are offering to waive certain fees for new tenants, along with other incentives. Getting a vacancy filled is important in this economy. The only negative you may come across is that landlords willing to drop rents are looking for tenants with good credit—tenants they can be sure will pay their bills. In some cases, it may be harder to find an apartment for renters with rocky credit histories.

Tags: Help Me Now!

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• Prorating Rent: Check your Landlord’s Math
• Getting the Most out of Tenant Incentives
• How to Make Move-Out Day Painless & Easy

This entry was posted on Monday, May 11th, 2009 at 9:04 am and is filed under Help Me Now!. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.