More good news for renters! And great info for Owners!
Virtually all landlords are cutting rents as most property managers remain pessimistic about the industry’s immediate future.
According to a nationwide landlord survey by the National Association of Home Builders, in the fourth quarter
•2% of landlords said they were raising rents; as 33% were cutting rents. That placed the NAHB “asking rent” index at 34 for Q4 — on a scale of 1 (greatly falling) to 100 (greatly rising) — worst in at least 7 years.
•6% of landlords say they are raising “effective rents” — rents minus any concessions; 49% are cutting effective rates. That placed the NAHB “effective rent” index at 28 — on a scale of 1 (greatly falling) to 100 (greatly rising) — up a tick from Q3.
Business conditions vary by class of apartment owned, the NAHB survey showed in the fourth quarter:
•Landlords with top-shelf Class A unit were the most pessimistic, with a 39.5 “expectations” on a scale of 1 (most pessimistic) to 100 (most optimistic) — worst in nine months.
•Managers of “low-end” Class C projects were the most buoyant of the bunch, with a barely “optimistic” scare of 51.2 score — best in nine months.
•Finally, owners of middle-market Class B buildings had a 40.6 “expectations” index reading — worst in 15 months.
What does this mean?
Renters can negotiate for best and fair prices, (No Greed please.)
Owners who are savvy are willing to work with prospective tenants AND existing tenants, (NO GREED PLEASE).
I advise my investor owners to also stay in touch with tenants, maybe send them a thank you card every so few months, toss in a starbucks card.
Its cheaper than having a vacancy.
Stop being confrontational, be proactive.
Tenants, also should be proactive and show appreciation when the time arises.
Working together and everyone wins.
John Hacker
Realty One Group
Irvine, California
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