Apartment rents rose across the U.S. West and South for the third straight quarter as record foreclosures boosted demand for rental housing, RealFacts said.
The average asking rent climbed to $958 a month from $950 in the second quarter, according to a report released today by the Novato, California-based research company. It declined 0.7 percent from a year earlier. Rents reached a record $1,002 in the third quarter of 2008.
“We’re getting to be much more of a culture that puts a premium on rental housing,” Sarah Bridge, owner of RealFacts, said in an interview. “People are disillusioned with the housing market. They don’t want to spend their money that way if they’re going to be foreclosed on.”
Sales of properties in the foreclosure process accounted for almost a third of U.S. transactions in September and surpassed 100,000 for the first time, RealtyTrac Inc. said on Oct. 14. The data provider’s figures go back to 2005.
Apartment rents rose fastest in the Denver area, with rates increasing 2.4 percent from the second quarter to $883 a month, followed by the Austin, Texas, region, with a 2.3 gain to $837 a month, RealFacts said. In the Atlanta area, rents rose 2.2 percent to $834, and in the San Jose, California, region they increased 1.9 percent to $1,587.
The San Jose area, which encompasses Sunnyvale and Santa Clara, was the priciest region in RealFacts’ database in the third quarter.
Apartments were 92.8 percent occupied, up from 92 percent in the second quarter and 91.7 percent a year earlier, according to RealFacts.
“It seems the apartment sector is outperforming the economy in general,” Bridge said.
The survey covers 3.29 million rental units in states including California, Florida, Indiana, Arizona, Texas, Colorado and Nevada. Closely held RealFacts surveys apartment owners quarterly.