Rents Rising Nationwide

From the Wall Street Journal:

Across the U.S., “effective” monthly rent—which means the final amount paid including discounts—averaged $1,044 in October, up 3.7% from a year ago, according to Reis Inc., a real-estate data firm. Landlords no longer have to “pony up in order to entice tenants,” said Victor Calanog, Reis’s chief economist. He added that rising vacancies suggest rents are “approaching equilibrium,” but aren’t likely to fall soon.

In the third quarter, the ratio of rent to after-tax mortgage payments was 107.8%, according to Deutsche Bank . A rent-to-mortgage ratio above 100 means mortgage payments are cheaper than rent for the median homeowner. The ratio was down from an all-time high of 120.7% in the first quarter, but well above an average of 85% since 1991.

The rising cost of renting is putting pressure on tenants at a time when many are still grappling with slow or falling income growth. In the third quarter, renters spent 24.12% of their disposable income on financial obligations—things such as rent, debts and auto leases. That was the highest level since early 2010, according to the Federal Reserve.