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Incomes Need to Rise at This Pace to Stay on Track With Rents

Apr 8, 2017 by

Rent raised? You’ll need a raise.

According to a new analysis by Zillow, the average renter would need his or her income to grow by $ 168 to keep up with an expected 1 percent rise in rents over the next year. Many renters, however, would need more—in some cases, much more—to keep costs manageable.

Renters in Seattle, Los Angeles, Boston, Sacramento, and Orlando would be in need of the biggest pay bumps, according to the analysis. In Seattle, renters would need an additional $ 1,248, while in Orlando, renters would need an additional $ 672.

Renters in San Antonio, Detroit, Las Vegas, Austin and Columbus would be in need of the smallest—$ 84 in San Antonio and $ 264 in Columbus.

“For a long time now, renters have faced an affordability crisis when it comes to housing, and renters in some hot markets will still need significant raises just to keep up with rising rents,” says Dr. Svenja Gudell, chief economist at Zillow. “Incomes have a ways to go to bring rental affordability closer to historical levels, but recent gains are being met with slowing rent appreciation—a welcome sign for renters.”

Appreciation is grinding to a halt in many major metropolitan areas—conditions which, combined with growing incomes, make them ideal for renters. These include New York, Chicago, Houston and Miami, according to the analysis.

For more information, please visit www.zillow.com.

For the latest real estate news and trends, bookmark RISMedia.com.

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Rising Rents Offer More Home-Buying Opportunities

Mar 13, 2017 by

Editor’s Note: This was originally published on RISMedia’s blog, Housecall. See what else is cookin’ at blog.rismedia.com:

As rising rents sweep the country, the channel between the cost of owning and the cost of renting continues to slim. According to the latest Florida Atlantic University national index, today’s active rental prices make for a great time to purchase a home.

“We are not where we were in 2012, when nearly any purchase was a sound financial decision,” said Ken Johnson, Ph.D., real estate economist and index author, in a recent press release. “However, overall, we are now in a situation where aggressive marketing from sellers combined with due diligence and sound negotiation from buyers is creating a housing market that’s more in line with what we’ve seen historically.”

The index, called the Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index, shows that 15 of the 23 cities studied are set in buy territory, while another five are only marginally in rent territory. This news only further fortifies the positive outcome of the latest S&P/Case-Shiller Home Price Index, which showed home prices rising at the highest annual increase since June 2014, roughly 5.8 percent year-over-year. Out of the 23 cities studied in the BH&J Index, the only urban places to show discouraging market conditions are Dallas, Denver and Houston.

“The scores for Dallas, Denver and Houston have had worried us for some time now,” said Eli Beracha, Ph.D., co-author of the index and assistant professor in the T&S Hollo School of Real Estate at FIU. “The last time we saw scores of this magnitude, housing market crashes soon followed.”

The overall verdict seems to be, if you can afford to buy in, the time to do so is now.

To reach their finding, the FAU Index incorporated property appreciation from housing markets around the country. This data is joined by rental, maintenance and alternative investment data streams. Together, these factors can indicate when (and why) housing markets might change direction.

For more information, visit business.fau.edu/buyvsrent.

Zoe Eisenberg is RISMedia’s senior content editor. Email her your real estate ideas at zoe@rismedia.com.

For the latest real estate news and trends, bookmark RISMedia.com.

The post Rising Rents Offer More Home-Buying Opportunities appeared first on RISMedia.

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