Real Estate IRA News : Rents Dropping Slightly In Some Markets

A recent study from real estate data and research company Zillow finds that rents in the top 25 metro areas have cooled slightly over the last year. But rents in some markets continue to increase. These markets may be the most attractive for self-directed Real Estate IRA owners – provided they have the capital to buy in to these expensive markets in the first place!

From a tenant’s perspective, of course, declining rent prices are a feature, not a bug. But most Real Estate IRA investors would rather invest in a market with increasing rent momentum.  The recent Zillow survey indicates that the supply of affordable housing is in many major markets – especially along the coasts – is disappearing.

To that end, here are the major U.S. metro areas where the percentage of affordable listings as a fraction of the total rental housing market have been declining the fastest:

Oakland-Hayward-Berkeley, California                              46.2%             -19.8%

Orange County, California                                                    53.6%             -10.8%

Phoenix-Mesa-Scottsdale, Arizona                                      78.1%             -9.4%

Portland-Vancouver-Hillsboro, Oregon/Washington       72.7%             -6.2%

Seattle-Bellevue-Everett, Washington                                70.5%             -4.9%

San Francisco-Redwood City-South San Francisco, CA    22.2%             -4.2%

Atlanta-Sandy Springs-Roswell, Georgia                            55.9%             -3.5%

Boston, Massachusetts                                                         49.2%             -2.7%

Tampa-St. Petersburg-Clearwater, Florida                                    63.7%             -2.0%

Miami-Miami Beach-Kendall, Florida                                  6.9%               -1.8%

Los Angeles-Long Beach-Glendale, California                   32.1%             -1.8%

Riverside-San Bernadino-Ontario, California                    91.7%             -0.9%

San Diego-Carlsbad, California                                            61.7%             -0.2%

These are all markets in which the available stock of affordable apartments and houses are actually declining – and therefore the markets in which the upward pressure on future rent levels is probably greatest.

It should be noted, however, that affordable housing in some of these areas, such as Miami-Miami Beach-Kendall, Florida, is so low that even a modest decline represents a substantial fraction of the affordable housing stock. Regardless of the percentage movement on paper, competition among renters for access to affordable apartment homes in Miami, San Francisco and Los Angeles, where affordable housing represents only a third of available units, is going to be keen for a long time to come.

To get your Self-Directed Real Estate IRA started, contact us today at 866-7500-IRA(472). Or visit us online for our vast library of articles and other informational materials.

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