We have good news for renters this month! The median rent has dropped over 7% in the last 90 days and rental supply (on the MLS) has increased 22% in the same timeframe. This means renters will find more options and slightly better pricing.
Does this mean the market is on the verge of a crash? NO!
Over the last couple of years we have seen the rise of a new rental concept; entire neighborhoods of single family homes for rent. Many of these communities have recently finished up construction and have therefore put their rentals on the market.
Additionally, we have seen several communities and HOA’s change their rules on allowable Short-Term Rentals as well as new legislation surrounding short-term rentals. This has caused some of the short-term landlords to turn these properties into longer-term (12-month +) rentals.
The combination of these newly turned long-term rentals and the added build to rent neighborhoods have added enough supply to tamp rental prices for the time-being.
On the flip side, home sales have hit a positive year-over-year average pricing. This is very different from area to area though. Our favorite saying in real estate is Location, Location, Location. This could not be any more true than right now. Outskirt areas (such as Maricopa, Casa Grande, etc) are showing a low balanced market with year-over-year negative pricing. Closer in areas (such as Gilbert, Mesa, etc) are seeing positive year-over-year pricing. With interest rates still fluctuating we don’t expect to see a huge increase in pricing, likely closer to stable pricing overall in the upcoming months.
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