By Peter Ricci
Asking prices increased 0.7 percent from September to October in the latest Trulia Price Monitor, a survey of all the listings featured on the real estate syndication site.
In addition, prices rose 2.9 percent from October 2011; though the highest year-over-year gain to date for the Price Monitor, it could not quite match the numbers of the Trulia Rent Monitor, which found that asking rents continue to rise across the nation.
Trulia Price Monitor Increases, but Rents Talk of the Town
As Trulia has reported before, the nation’s multifamily housing sector continued to command higher and higher rents, even as asking prices increased for single-family housing:
- Asking rents increased 5.1 percent for the nation’s largest metropolitan markets, with the largest increases coming from areas as diverse as Miami (10 percent) and Chicago (7.7 percent). Both paled in comparison to Houston, though, where rents rose an incredible 16.5 percent.
- Asking prices in the Price Monitor were up 1.8 percent from the second quarter to the third quarter, and excluding foreclosures, they increased 3.6 percent year-over-year in October. Interestingly, though Chicago’s rental market surged in October, its asking prices faltered somewhat, falling 5.3 percent from last year.
Multifamily Housing – A Boon to Single-Family Real Estate?
Trulia’s Price Monitor and Rent Monitor are just the latest evidence of the booming multifamily housing sector, which, despite some contrary analysis, has shown little sign of slowing heading in to 2013.
In fact, as Carmen Rodriguez of Coldwell Banker in Edgebrook explained, the rising rents in Chicago have led some of her clients to buy rather than rent.
“Just this summer I had a dad buy his daughter a downtown condo for about $250,000 while she attends law school,” Rodriguez said, “because the cost of rental or dorms was only slightly less and he figured long-haul it was a better investment to buy.”
Rents can only rise so far before consumers begin looking for less costly housing options, so could Chicago’s rising rental market ultimately help single-family housing?