The limited availability for renting in real estate markets around the world and especially in the U.S.

The real estate landscape in the United States has evolved in recent times, with the market becoming significantly competitive and rents going as high as 30%. Additionally, there is limited availability for renting as the national economy begins to bounce back from the COVID-19 pandemic.

This article details all you need to know about the limited availability of renting in real estate markets around the world and what you can do about it.

What’s the rental market like now?

The U.S. property rental market has been increasing in appeal and popularity as more people are turning away from mortgages to renting. According to the most recent data available from CoreLogic Inc., rental prices for single-family homes grew an average of 7.8% in 2021, which was an all-time high. 

As the world bounces back from the ravages of the COVID-19 pandemic, the demand for rentals has increased, as houses that were previously abandoned due to the pandemic are getting rapidly snapped up. The reason for this change is pretty apparent: people that had fled urban economies due to the virus and the resulting lockdown are now returning. 

As the virus' threat level recedes and life seems to be going back to normal, people who had chosen to bunk down together in the suburbs to ride the waves of the pandemic are now seeking their personal spaces. As a result, the urban cities are looking appealing again.

Thus, there is an increase in the relocation rate, leading to a higher demand for rental property. Since the forces that caused landlords to drop their prices and suffer vacancies have eased, rental prices have increased.

For example, consider New York City, where renters make up two-thirds of all households. Rents in New York rose 33 percent between January 2021 and January 2022, which is almost double the national rate. In January 2020, pre-pandemic, the median asking rate in New York was $2,900. This rate declined by about 14% in 2021 before climbing back up by about 16% to $2,895 in January this year. c

In Williamsburg, Brooklyn, the median asking rent dropped by roughly 20% between January 2020 and January 2021. However, they have spiked by around 40 percent since then, becoming higher than before the pandemic. In Brooklyn, the average rental price for a two-bedroom unit increased from $3,796.56 to $3,846.35 over the past month. 

Why are rental properties going so fast?

According to the Washington Post, the number one reason rental properties are going so fast is that more people are looking for their own space. Young adults who hunkered down with their parents to ride out the pandemic are moving out at record rates. People are much more inclined towards having their own space, privacy, and flexibility. 

Furthermore, building new rentals is not going as smoothly as possible, thanks to the global supply chain disruption, another wonderful gift from the pandemic. Thus, there is a shortage of workers and materials, leading to construction delays, with the inevitable result of a deficit in housing supply. 

Reason number two is that the housing market has become pretty competitive, and many people who would have loved to buy homes find it difficult to meet the financial requirements. As a result, they are more inclined to rent instead of buy.

Reason number three is that many of the measures put in place to help renters get by during the pandemic, such as the eviction moratorium, are no longer in effect. Thus, landlords are increasing their rents with the apparent goal of recovering all they lost during the two years the pandemic forced them to lower their rents.

This ties in neatly with reason number four, as the high rent rates mean that only wealthy and high-income earners can afford to pay them. Additionally, as the pandemic reshaped the work landscape and pushed remote work into the limelight, people are no longer forced to live in one location because of their work. Instead, they move into areas where they can easily afford to take one-to-six-month leases while trying out new cities and figuring out where they can permanently buy. So, of course, the rental prices are not a big deal for this group of people.

Why is the rental market so busy?

In response to the pandemic, the Center for Disease Control established the eviction moratorium in 2020. However, this ended in August 2021 in response to the Supreme Court’s ruling that the extended moratorium was unconstitutional. Since then, eviction rates have been increasing every month, with expectations that they will get back to pre-pandemic levels this year.

With the different factors affecting real estate in the U.S., especially with rentals, it is easy to become discouraged and want to stay put wherever you presently are. However, if you have to relocate because of a new job opportunity, staying put will obviously not be an option for you.

So how do you combat these varying factors that are seemingly stacked against rentals and get to rent the apartment or home of your dreams?

Combating limited availability in markets around the world

Yes, the rental property landscape has changed dramatically. Things are a lot more competitive than they used to be, and getting the rental property of your dreams seems like an impossibility. 

However, it is possible to get what you want with the proper knowledge and a joker up your sleeve. The following tips provide you with the first half of what you need – the appropriate knowledge.

Have a solid credit score

A credit score reflects your history of paying bills on time. TransUnion, a credit reporting company, says that for a rating range of 300 to 850, a credit score of 700 is good. However, building up a good credit score takes time, and if you are someone new to the field of renting in the U.S. or you are relocating from another country, you may not have the score nor the time to build it up. 

Be flexible about your requirements.

Yes, having a dream house is great. However, you may not always get your dream, but you may get something close to it. As long as your basic requirements are met, it is best to be flexible about the rest, as much as possible. Being flexible also means being prepared to decide based on fewer options, as the choices are getting increasingly limited.

Position yourself as the best tenant possible

Landlords will be more inclined to rent out to you when they are guaranteed that you will take proper care of their property. This could mean writing a personalised letter to the landlord, explaining why you want to live on their property and how much care you will put into keeping it in ship shape. 

Hint: landlords want high returns on as little investments as possible, e.g., money spent on repairs. 

Have your money ready when you go for the viewing

Landlords look more favourably on renters who have their deposits ready upfront, including their security deposits. To sweeten things even more, you may offer more than what is required to gain a distinct advantage, especially if you do not have the required credit score.

Now to the joker.

You will no doubt get results from the tips listed above, but you will get even better results when you do things with the aid of experts. 

Expat-US are experts in assisting individuals and employees step-by-step with their relocation to the United States. Whether you are an individual looking to relocate to the U.S., or an organisation looking to relocate your employees for a new position, you will need all of the help you can get, and Expat-US is all you need for this.

We have different relocation packages that meet your varied needs, all targeted at helping you manage your relocation and making it as stress-free as possible. Please click here to schedule a free consultation with us to help us understand your unique needs and provide you with a customised solution.