USA Today's Paul Davidson looks at new data from MPF Research that show that the share of renters opting to renew has hit a high-water mark.
About 53.8% of renters decided to stay put through the first seven months of this year, an increase of nearly 100 basis points from 2015 and far above the historical long-term average of around 45%. Part of what's driving the trend is a lack of affordable options, as the new-construction pipeline continues to be "top heavy" with luxury units.
... renters looking to move to other low- or mid-priced apartments have few choices, [RealPage chief rconomist Greg] Willett says. The occupancy rate is 96.4% for low-priced units and 96.2% for mid-priced dwellings, according to RealPage.
“You’re unlikely to relocate if it’s a big struggle to find a vacant apartment in your preferred neighborhood at the price point you can afford,” Willett says.
By contrast, occupancy is 94.9% for expensive apartments. That’s largely because apartment developers are overwhelmingly putting up luxury buildings, many in or near central business districts to accommodate the Millennials and others who prefer to live there. Willett says land is so pricey in those areas that more affordable apartment complexes would not be profitable in many cases.