Paying Rent Becomes a Battle for Renters

January 17, 2023

Rise and shine! It's a new day and The Shaker is here to serve you the best mix of residential real estate news. Yummy yummy.

What you should know:

55% of US renters, equivalent to 32 million people, said their monthly rents increased by at least $100 in the past year.
2.3 million renters reported an increase of more than $500.
The latest housing-market data suggests that the pandemic-driven surge in rental prices may be easing or even going into reverse in some markets.
More than 1.4 million renters with annual household incomes of less than $75,000 reported a monthly payment increase of $500 or more during the past 12 months.
Cities including Miami, Phoenix, and Seattle had a relatively large share of jumbo rent hikes relative to their population, while in some major east-coast metropolises including New York the increases were typically smaller.

More tasty news in this shake

Miami to escape the home price correction in 2023

Goldman Sachs warns that the ongoing home price correction in the US might continue through 2023.
They expect a -6.1% YOY depreciation in the Case-Shiller Home Price Index, representing an aggregate peak-to-trough decline of roughly 10% in US home prices through the end of 2023.
They expect double-digit home price declines in major markets like Austin, San Francisco, San Diego, Phoenix, Denver, Seattle, Tampa, and Las Vegas.

The Housing Market is Shifting: Buyers are Gaining More Control

Jay Farner, CEO of America's largest mortgage lender Rocket Mortgage, has said that the days of sellers holding all the power in the housing market are over, as buyers now have more control.
The housing market has cooled off in recent months as mortgage rates have risen, and home sales have dropped for the 10th month in a row. However, Farner is not yet prepared to declare this a buyer's market as inventories remain historically low.
Farner does not expect home prices to plunge, but is worried about a downturn in the economy, pointing to businesses pulling back on spending, slowing job growth, and emerging signs of trouble for consumers.

Florida's New Condo Law: Protection or Wallet-Buster?

Florida has passed legislation mandating emergency reserve funds for condominiums statewide after the collapse of the 12-story Champlain Towers South in Surfside. However, some experts have warned that the mandatory reserves could damage Floridians' wallets, as the costs will be passed on to the consumers in some way.
The bill includes requirements for preventative maintenance and construction inspections on buildings three stories or higher, and for condo associations to collect and maintain structural integrity reserve studies and funds. The associations are required to perform a reserve cost analysis every 10 years for repair costs that meet or exceed $10,000.
The experts have warned that this new law could financially hurt landlords and Airbnb hosts, who may now have to pay additional housing costs under the new law. Also, it will create a dichotomy between high-rise condos and single-family homes in Florida, as single-family homes will become more desirable because people can control their own destiny.

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