Apartment rents still rising, but not as fast

An increasing supply of rental units is slowing the rise in rents. The annual rent appreciation has slowed for the past three consecutive months as more apartments become available.

Rents appreciated 4.5 percent, down from 5.3 percent in September, according to a study and report from Zillow.

"Newly built apartment buildings are finally opening for new residents and slowing the rate of rental appreciation across the country, but rents are still rising much faster than the historical norm and continue to rise faster than incomes," according to the report.

"Nationally, rents grew at 4.5 percent annually in October, down from 5.3 percent in September and down from a high of 6.6 percent in July. Single-family rents are rising faster than multifamily rents, at 4.5 compared to 3.9 percent.

"Multifamily housing starts have been increasing since late 2009, and as units become available, the pace of rental appreciation is slowing. Lack of inventory has been a leading cause of the ongoing rental affordability crisis, especially in fast-growing markets.

"Even the hottest rental markets, which have seen double-digit rent appreciation for the past five months, are growing at a slower pace although rents are still rising there more than twice as fast as the national average."

The report named the market with the fastest growing rents. "The San Francisco metro has the fastest rental appreciation among the nation's 35 largest markets. Rents there are up 15.2 percent from last year, but they were growing as fast as 19 percent annually in June and July."

Q. Is it a waste of time trying to sell a home during the holidays?

A. Some brokers and sellers have discovered that the holidays are exceptionally good times to promote and sell a home. This is the time when most people are busy with gift-buying and other festivities - except those who are really serious about finding and purchasing a home.

As a personal note, back in the years when I was working as a broker, I had a very surprising experience.

I was asked to show a listed property to a family on Thanksgiving Day. I thought these folks were probably looking for something to do on a lazy holiday. I not only made a sale on that day, but the home was also the most expensive property I ever sold.

Q. What will result from rising mortgage rates?

A. Several real estate economists have addressed this change. "A rise in mortgage rates is pushing down loan applications. In the latest week, total mortgage applications for refinancing and home purchases dropped 3.2 percent week-to-week on a seasonally adjusted basis," according to the Mortgage Bankers Association.

"Applications are now skewing more toward larger loans for pricier homes," MBA reports. "Refinance applications dropped 5 percent last week on a seasonally adjusted basis, reaching the lowest level since early September. They're still 4 percent higher than a year ago, when interest rates were slightly higher."

Q. Is it practical for a homeowner to handle a home improvement project?

A. That's a good way to save money, if the owner has the capability to do the job. But it can be quite risky. Here's an interesting report issued by Zillow, based on a survey:

"Three-quarters of homeowners completed a do-it-yourself project in the past three years. However, nearly 40 percent of them wish they hadn't.

"Attempting to add or expand a room to a home, such as a bathroom or bedroom, was the biggest DIY regret among homeowners surveyed, with more than half of respondents (53 percent) unhappy with some aspect of the project. Homeowners had fewest regrets around minor projects like replacing light fixtures or cabinet hardware. Less than 20 percent of homeowners regretted taking on those projects.

"While many people choose to tackle home improvement projects themselves to save money, nearly a quarter of those surveyed said their DIY project went over budget. This was especially true for larger-scale renovations, like building a new deck or refinishing a basement. Instead, DIYers were more likely to stay within budget on smaller projects such as painting or replacing plumbing fixtures."

• Email Jim Woodard at storyjim@aol.com.

© 2015, Creators Syndicate