Rents are still rising.
Nationally, rents rose 4.7 percent in August from a year ago, which, while still a gain, is down from the 5.8 percent annual increase in May – making it the slowest rise since March, according to Trulia.com. Some markets, however, are still hot, with rents up around 10 percent year over year. These include Houston and Seattle, Denver and San Francisco.
“Rents had been on fire earlier this year, but some of the hottest rental markets are starting to cool,” said Jed Kolko, Trulia’s Chief Economist. “New construction that started last year is finally coming onto the market, giving renters more choices and some relief from rising rents. Still, rents are climbing in nearly all of the major rental markets.”
Investors in the multi-family apartment space don't seem concerned, as we noted in a post last week, with most saying that an improving housing market can peacefully co-exist with a strong rental market for a time, as long as rents don't become completely unaffordable.
Much of the improvement in housing is thanks to investors, not regular home buyers. Witness yet another drop in weekly mortgage applications today, the fifth straight week, according to the Mortgage Bankers Association. Applications to purchase a home were down just under one percent. This as the rate on the 30-year fixed fell. Again that points to a continued strong rental market.