Owning a single-family Charleston rental property can be a challenging, exciting, and profitable way of building wealth. But this is only true if you really understand the rental real estate market. When you are a rental property investor, information is power. To get you started, here are four important facts about the 2022 rental real estate market.
1. The national average rent increased by 36% in the last ten years.
Statistics show that in the U.S., the national average rent has gone up by 36% in the last decade. We can attribute these increases to a variety of factors, from a shift in renter demographics to a booming job market. In fact, the national demand for rental homes and the number of renters has ballooned two times faster than the number of renters. There are twenty U.S. cities that have shifted from being a homeowner majority to a renter majority in just the last ten years. These data indicate a significant lifestyle change for many Americans.
2. Rental properties appreciated an average of 5.2% every year over the last ten years.
There has also been a huge increase in housing prices in the last few years, leading to a rapid rise in property values in markets all over the country. On a national level, property values went up at an average rate of 5.25% each year in the last decade. According to some metrics, 2021 saw the highest appreciation in home values on record – an average of 14.5%. This just goes to show that recession years do not always result in falling property values.
3. More people than ever are renting instead of buying.
With the decade-long sustained growth, the renter population in the U.S. is now over 100 million. Between 2010 and 2018 alone, the country has seen an increase in the number of renters by more than 9 million people. In the same period, there were only just over 8 million new homeowners. Data shows that around 34% of the general population currently rent their homes. The U.S has not seen this large a share of renters since the 1960s.
4. As demand for rental homes increases, supply falls behind.
There has only been small evidence of growth in the number of renter-occupied housing units in the United States in the last decade. For a nation with just under 44 million renters, there are only about 43 million rental homes. It is not a surprise that demand for rental homes continues to be higher than availability, and residential vacancy rates are very low in many markets around the country. This strong demand drives competition among both renters and rental rates.
Knowing these facts, this is the best time to invest in the rental real estate market. And Real Property Management Charleston can help! Our expert team of Charleston property managers works with investors to help find quality rental properties, assess the local market, and provide comprehensive property management services. Contact us at 843-900-4061 to learn more.
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