Navigating a Tight Rental Market | Healthcare Concerns

By RACHEL LOUISE ENSIGN

When Kathleen Marin and her boyfriend first moved to the Baltimore area in 2008, their two-bedroom town house cost them $1,100 a month. But over the next 2? years, as demand flooded the rental market in their area, the landlord gradually upped their rent to $1,400.

Buying a home wasn?t an option for the 27-year-old student, who works part time and has a limited credit history. So late last year, the couple sought out a cheaper place. After searching online listings and visiting properties nightly for three weeks, they eventually found an apartment for $1,200 that they plan to move into in May.

But the cheaper place comes with another price: a lot less space (one floor instead of their current two-story town house) and a dated kitchen.

John Ueland

?If I?d gone into it and wanted the balcony and the brand-new kitchen,? Ms. Marin says, ?I would never have found this apartment.?

The rental market is the tightest it?s been in more than a decade, with only 5.2% of apartments nationwide vacant at the end of 2011, down from a high of 8% in 2009, according to real-estate data firm Reis.

Demand is up as the housing crisis and tighter lending standards have left many people unable to or wary of purchasing a home. And higher demand means average rents are rising, too.

To find the best deal possible in this market you first need to figure out what makes one rental cheaper than others in a given area. For instance, space in new apartment buildings is at a premium since relatively few buildings have been built since the housing crisis. That means the best deals can be found in older constructions, though even these are pricier these days.

And amenities?and rents?can fluctuate substantially within a single building. An apartment on a lower floor will typically cost less than one on a higher floor. So will one with an obstructed view and little direct sunlight. The two-bedroom apartment Ms. Marin is moving into has a kitchen and appliances that are more dated than in some other apartments in the building.

When checking out an apartment, ask the real-estate or rental agent if there are less-expensive properties available. Ms. Marin and her boyfriend did so and snagged an apartment in the complex that was $120 cheaper than the one they were originally shown.

If you are looking to rent a single-family home, that market is even more competitive since there are fewer such properties on the market. In many places, monthly rent for a single-family dwelling runs more than a monthly mortgage payment on a similar property would, says Michael Labout, a residential real-estate broker in Colorado Springs, Colo.

If renting a home is a temporary solution, you can save money by looking in a less-than-ideal school district if you don?t have school-age children or on a noisy street. Multifamily dwellings also are typically cheaper than single-family homes.

A newer entry into the rental market is homes being rented by owners who haven?t been able to sell. With information on local rental prices widely available online, these first-time landlords will likely be asking for market prices, says Jed Smith, managing director for quantitative research at the National Association of Realtors. Since their ultimate goal is to sell the property, these landlords may be more serious about maintenance of the property than a landlord who owns multiple properties, he says. So make sure a lease specifies who is responsible for taking care of?and paying for?what.

And if you see a place that you really like that?s been for sale for an extended period, inquire about renting it instead. Owners may be open to a deal if they are desperate.

When it comes to negotiating rent, in this market you need to approach it the same way you would a home purchase. That means finding out what the comparable rents in the area are and presenting that data to the landlord.

In a landlords? market, ?it will be more difficult to negotiate a lower rate, but the key to negotiating? will be comparable properties, says Mr. Smith. If you point out that an apartment is going for more than market rate, you?re likely to get it down to market rate.

Also, showing a potential landlord your credit report to prove that you aren?t a financial risk can help you get a lower payment in some cases, says Mr. Smith.

If you?re handy, look for a fixer-upper rental. There are many more of them these days since landlords are confident they?ll be able to rent them with all of the demand. You can suggest making repairs in exchange for lower rent, says Mr. Labout. Just be sure to get it in writing.

Source: http://cplpcienciassociais.org/navigating-a-tight-rental-market

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