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Demand in Chicago and Houston has shot up especially high
Across the nation demand for apartments is now at a five-year high, a consequence of slow home sales and economic uncertainty.
The number of move-ins during the second quarter shot up 11 percent compared to last year, according to the Wall Street Journal, citing data from RealPage. That surge caused the national occupancy rate to hit 95.8 percent, according to the report.
In Chicago and Houston, demand grew particularly strongly, as move-ins outpaced new construction by an almost 3 to 1. Smaller metro areas saw big rental price increases as well, including Wilmington, N.C., where rents jumped by 7.4 percent, and Huntsville, Ala., where they rose by 6.4 percent.
Apartment construction is nearing a 30-year high, but most of the products are for higher-income earners, leaving the market for affordable rentals significantly tighter. In Chicago, where demand for rentals continues to be strong, investors are buying up condominiums and deconverting them into apartments.
The housing market is also rough for buyers right now. The asking price for homes is going up at a faster rate than income, and the volume of existing homes for sale has fallen for 15 months straight.