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November 5th, 2012 by Esther Cho
Rent prices are climbing faster than asking prices, and the gain in rent prices is seen in metros where asking prices are actually falling, according to a report from Trulia.
Nationwide, year-over-year rent prices were up 5.1% in October, while asking prices were up 2.9% during the same period including foreclosures.
Out of the top 25 rental markets in the United States, Houston led with a 16.5% yearly increase. Miami and Oakland took the next two spots with a 10% gain in rent prices.
Denver was ranked fourth with a 9.4% increase and Seattle fifth for its 8.8% improvement.
Chicago, which saw a 5.3% yearly dip in asking prices in October, still experienced a 7.7% gain in rent prices during the same one-year period.
Asking prices also fell in Albuquerque, dropping 2.2%, but rent prices moved up by 3.1%.
The trend was reversed in Las Vegas, where asking prices were up 10.9% from October 2011, while rent prices moved downward by 1.8%. In Memphis, rent prices were also down, falling 0.6%, yet asking prices increased 7.1% over a one-year period.
Overall, most metros saw rent prices and asking prices increase. Out of the 100 largest metros, 69 took part in the yearly gain in asking prices.
“In markets like Denver, San Francisco, and Oakland, where prices and rents are both rising, higher prices mean higher down payments, but rising rents make it harder to save enough,” said Jed Kolko, Trulia’s chief economist, in a release.
When tracking asking price increases among metros, Phoenix led with a reported 24.9% yearly gain. Cape Coral-Fort Myers, Florida ranked second with a 15.7% increase, followed by San Jose (12.7%); Warren-Troy-Farmington Hills, Michigan (11.8%); and West Palm Beach, Florida (11.3%).
“Home prices are climbing in most local markets and in eight of the eleven swing states,” Kolko added. “Rising prices have taken pressure off the presidential candidates from having to come up with detailed plans to help the housing market, and that’s a big reason why they haven’t focused on housing in the 2012 campaign,”
Trulia’s findings are based on the for-sale homes and rental properties listed by the company.
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