As you can see from the chart above we are still in a very challenging market. Price (i.e., rent) is still THE factor in getting properties rented. We estimate that rents are down about 30% from two years ago and about 10% from last year. The single family homes are the least sensitive to these pressures with the apartments most sensitive. One can still see signs offering free rent and 'no deposit' move ins at some apartment complexes.
The total rentals appeared to peak in July and we are seeing the same trend from years past. After Labor Day the market begins to slack off dramatically. Just as in the real estate sales markets the higher end rentals are very slow while the low-end properties seem to be in higher demand. The biggest factor here is probably the lower numbers of families moving into the area.
One disturbing trend we see is the increasing number of landlords offering leases without requiring security deposits. Our experience shows that the lower the deposit the less the tenants take care of the property. We are not feeling this pressure but will be watching this with interest. Our policies still require deposits from ALL tenants and, if their credit or background checks are borderline, we require last month's rent in advance. With few exceptions we are not having problems getting these funds as security.
We are now 89% rented with most of the remaining 11% being new properties. Those properties we have managed for over 6 months have a 3% vacancy rate. We are very pleased with this rate and remain hopeful our vacant properties will rent soon. The peak season (July & August) was still a good season. This was a very positive indicator that the market is coming back somewhat.
