April 08, 2019
Orlando Receives the Third Highest Rate of Rent Increase in 2018
As one might expect from a housing market where prices have continued to rise for the purchase of homes, rental prices have continued to rise as well. Yet the news is better for rental investors in some markets than for those in others. According to CoreLogic’s December Single-Family Rent Index, there has been a certain amount of plateauing in some markets while others have seen continued growth—among them the Topouzis & Associates, P.C. service area of Orlando, Florida. The Index “analyzes single-family rent price changes nationally and among 20 metropolitan areas.” During October 2108, we saw a national rent increase of three percent, an improvement over the 2.7 percent seen in October of the previous year.
A number of factors play into the increase of single-family home rental prices. The most fundamental factor is the classic case of supply and demand: low inventory of rental homes and high demand for same pushes the prices higher as renters compete for space. Among the elements that influence lower inventory are that an area has limited new construction, low vacancies among the rental units that exist, and an otherwise robust economy (with plenty of jobs). This is the case for Orlando, which comes in third place among areas where rent increased most over the given period (only Las Vegas, Nevada, and Phoenix, Arizona saw greater rates of growth), at a year-over-year rate of 5.3 percent as of October 2018. Orlando’s growth of employment year-over-year during the same period was 4.4 percent (compare this to the national average of a mere 1.7 percent).
Overall the price for a single-family rental has gone up since 2010, though year-over-year price increases have slowed quite a bit since seeing their peak in February 2016 at 4.2 percent.
For potential investors, it seems that Orlando may be among the best bets for rental properties during the foreseeable future.
Here at Topouzis & Associates, P.C., we do extensive title search work on every form of residential property, whether the purchaser intends to dwell in the home or to treat it as an investment. Contact us if you have any questions or if you would like our considerable experience in dealing with the particularities of the real estate system.