Wednesday, February 22 2006 @ 05:33 pm UTC
Contributed by: jron
According to real estate data firm M/PF YieldStar, if rent money is harder to come by, blame it on the hottest rental market in five years. The average rent climbed to $940 in the fourth quarter of 2005, And this year, itís going to be even more expensive as rents recover from historically low levels, reports says.
For rents, said Greg Willett, vice president of research at Carrolton, Texas-based M/PF, "2006 should be the big price correction," and added "Everything is really underpriced in many markets around the U.S."
But in many areas, the number of apartments is dwindling, as building has failed to keep pace. National apartment occupancy rose 1.6% to 95.2% in last yearís fourth quarter, the highest point since the fall of 2001. Rising home costs, coupled with an increase in new job creation, is creating a bigger pool of renters, Willett said.
Jess Callahan, a 29-year-old Ft. Lauderdale yoga instructor and single mother looking for a two-bedroom rental for $1,000 a month or less, said "Real estate is out of control here," and added "I've been looking on and off for six months."
It joins other cities like Chicago, San Diego, New York, Las Vegas and Miami, where a significant number of apartments are being converted to condominiums, at 99%, Ft. Lauderdale had the highest occupancy rate in the country in 2005ís fourth quarter; its average rent climbed 11.6% to $1,104.
According to the M/PF report, last year, condo conversions exceeded apartment construction for the first time in recent history.
Renters in Ft. Lauderdale say it's virtually impossible to find an apartment in a decent neighborhood unless you're willing to live in converted garage apartment, or pay thousands in rent. Not surprising, five of the nation's tightest apartment markets last year were in Florida, where the condo boom was in full swing.
"If you don't have $900 or more a month, it's pointless to even look" said Kim Miller, an interior design assistant who is looking for a one-bedroom in nearby Hollywood. Fla.
With only 400 new units under construction, rents shot up in these areas 12.6%, 7.9% and 6.3% respectively. Apartment occupancy in West Palm Beach, Orlando and Miami also came in above 97%, as more apartments were taken off the market in the fourth quarter.