U.S. Rental Rates Flatten in Major Cities as Supply Floods Market

The U.S. apartment market suffered its worst spring since 2010, near the depths of the housing crisis, as a flood of new supply and weakening demand resulted in rising vacancy rates and little or no rent increases in many major cities.To get more real estate news, you can visit shine news official website.Rents rose 2.3% in the second quarter compared with a year earlier, the weakest annual increase since the third quarter of 2010, according to data from RealPage Inc.
scheduled to be released on Wednesday. Rental growth was flat in major cities with otherwise strong economies—such as Austin, Portland, Seattle, Dallas and Washington, D.C.—due to large amounts of new supply.While average rents continued to grow, individual landlords cut rents in some markets. In addition, landlords are offering tenants incentives including as many as three months paying no rent, free parking, credit for ridesharing services like Uber and Lyft, and Amazon gift cards for as much as $2,500, according to renters, real-estate brokers and Hotpads, a rental search platform.Joshua Clark,
an economist at Hotpads who was looking recently for an apartment in the Capitol Hill area in Seattle, saw the $2,500 Amazon gift card offer.“I had my mouth open for a second. Seriously a lot of my expenses would be covered for the year, which would be fantastic,” he said.Landlords have enjoyed a record 32 straight quarters of annual rent growth on average, as the U.S. economy strengthened and millennials delayed homeownership. But the reports of slowing,
 which began in a few markets in late 2016, have intensified to the point that the balance is shifting towards renters and away from landlords.Greg Willett, chief economist at RealPage, predicted average rents nationwide could flatten if current trends continue. “It’s kind of telling as we look at some of these individual markets that are losing momentum because they’re important ones,” Mr. Willett said.The cause of the slowdown is primarily new supply.
 Developers responded to escalating rents by building the most new apartments in 30 years, sending a flood of new high-end units to downtown areas across the country. Developers are expected to add 300,000 new units over the next year across the U.S., Mr. Willett said.At the same time as there are signs renter demand is starting to wane because millennials are marrying, having children and buying homes or moving into single-family rentals. The U.S. added 1.3 million owner households in the first quarter over the same period last year and lost 286,000 renter households, according to U.S. Census data released in April.