Us rental increases hits seven-year high

Apartment rental growth has hit a seven-year high in the US, according to JLL.

The firm's latest Global Market Perspective shows that rental growth for apartments remained strong throughout tracked markets in 2015, accelerating to 4.3 per cent year-on-year - the fastest rate of increase this cycle and the largest advance since the second quarter of 2008.

13 markets saw rental growth in excess of 5 per cent year-on-year, with Western and Southeast regional markets seeing the greatest uplifts in rents, led by San Francisco’s 10.1 per cent gain. Yearly absorption on a national level continues to be unchanged at 1.6 per cent, with all major markets demonstrating positive
absorption.

"Markets have taken the influx of new development in their stride so far, due in part to the ever-expanding millennial demographic, as well as the ongoing structural decline in homeownership rates," comments JLL. "Nevertheless, select leading development markets are beginning to dip into a concerning realm from a leasing perspective, notably in Boston and Washington DC, as well as Austin, Minneapolis and Raleigh-Durham.

"While some of these markets are experiencing the highest absorption rates at present in the US, they have simultaneously seen delivery levels outpace
them."