According to Weiss Research the rental market has never been as strong. Analyst Michael Larson said some cities are recording double digit median increases.
'Now is possibly the best time to buy and profit from soaring rental demand and rapidly advancing rental yields,' he says in his research report.
'Never before in America's history has the real estate rental market appeared so strong. Vacancy levels are falling across the whole of America at record rates, and in parallel to this massive upside pressure that is being exerted on supply, the rate at which rental rates are rising is dramatic.'
The average predicted increase in rental rates for 2008 across the whole market according to the National Association of Realtors is at least 5.3%.
Three specific factors are causing record rental demand increases across the whole of America; the rate at which homes are being foreclosed upon is forcing increasing numbers of former homeowners into rental accommodation as they can no longer keep up with their mortgage costs; first time buyers or current rental tenants wishing to purchase are finding it dramatically and significantly harder to gain access to mortgages; and there are those who are biding their time before they buy in who are demanding rental accommodation in the meantime.
In certain parts of the country there are additional factors creating a situation where demand for rental accommodation is increasing unabated and where rental rates are rising dramatically.
In the Gulf Opportunity Zone for example, (the area devastated by Hurricane Katrina in 2005), there has been a great deal of effort, outlay and pure investment into rebuilding towns and regenerating communities.
In Biloxi, for example, investors will benefit from returning rental demand, and because there are 22 casinos opening in the area and providing employment opportunities alongside the likes of Chevron, NASA, The University of Southern Mississippi and Naval Construction Battalion.
