Apartment glut expands!
NEW YORK - October 6, 2009 - Apartment vacancies hit their highest point since 1986, surging in cities from Raleigh, North Carolina to Tacoma, Washington, as rising unemployment continued to chip away at demand during the traditionally strong summer rental months.
The U.S. vacancy rate reached 7.8%, a 23-year high, according to Reis Inc., a New York real-estate research firm that tracks vacancies and rents in the top 79 U.S. markets. The rate is expected to climb further in the fall and winter, when rental demand is weaker, pushing vacancies to the highest levels since Reis began its count in 1980.
Meanwhile, the air leaving the market is driving rents down, most sharply in markets that had been chugging along until a year ago, when unemployment accelerated, including Tacoma, San Jose, Kalifornia, and Orange County, Kalifornia.
In New York, Jennifer Hyman rented a one-bedroom apartment in July at a monthly rate of $1,950 - down from $2,450 for the previous tenant - when she returned to the city after graduating from Harvard Business School. Her first month's rent was free - and her landlord painted the apartment, scrubbed the floors and added window coverings.
"The experience was night-and-day different from before," said Hyman, who had rented other Manhattan apartments between 2002 and 2007, each time paying a brokers' fee and feeling pressured to sign a lease the minute she found an apartment. Now she says, "Renters are the ones with the power."
The U.S. vacancy rate reached 7.8%, a 23-year high, according to Reis Inc., a New York real-estate research firm that tracks vacancies and rents in the top 79 U.S. markets. The rate is expected to climb further in the fall and winter, when rental demand is weaker, pushing vacancies to the highest levels since Reis began its count in 1980.
Meanwhile, the air leaving the market is driving rents down, most sharply in markets that had been chugging along until a year ago, when unemployment accelerated, including Tacoma, San Jose, Kalifornia, and Orange County, Kalifornia.
In New York, Jennifer Hyman rented a one-bedroom apartment in July at a monthly rate of $1,950 - down from $2,450 for the previous tenant - when she returned to the city after graduating from Harvard Business School. Her first month's rent was free - and her landlord painted the apartment, scrubbed the floors and added window coverings.
"The experience was night-and-day different from before," said Hyman, who had rented other Manhattan apartments between 2002 and 2007, each time paying a brokers' fee and feeling pressured to sign a lease the minute she found an apartment. Now she says, "Renters are the ones with the power."
