Renter Satisfaction Remains Stable
The overall satisfaction of renters has continuously held steady over the past two years. This quarter proves to be no different with 76.7% of residents indicating their overall satisfaction as “good” or “excellent”, which is consistent with last quarter and one year ago. While national resident satisfaction has remained stable, the bulk of major cities have seen a slight decline in satisfaction over the past year. New York maintains an above-average satisfaction rate of 78.4%, but experienced the largest decrease in satisfaction with a 2.1% decline over the last twelve months. In contrast, Atlanta has a lower satisfaction rate of 76.1%, but recorded the largest rise in satisfaction with a 1.4% increase.
As Renewal Intent Levels Out, Atlanta Residents Less Likely to Move
After a surge in national renewal intent over the last six months, this quarter halted the upward trend. Residents indicating they are likely to renew their current lease remained unchanged from last quarter at 53.0%. Most major markets did not see significant fluctuation in renewal intent, with the exception of a few cities. Miami not only experienced the most considerable drop in renewal intent, with a difference of 2.2% from last year, but the city also has the lowest renewal intent rate at 46.5%. Conversely, renewal intent continues to climb in Washington D.C. and soared 7.9% in the last year, resulting in a renewal intent rate of 61.9% this quarter. Following behind Washington D.C., Atlanta experienced a rise of 3.3%, which improved the city’s renewal intent rate to 53.8%.
The sizeable change in Atlanta’s renewal intent comes as no surprise when considering the high level of resident satisfaction with respect to the value for amount paid. Atlanta boasts the highest renter value for amount paid, with 63.6% of residents satisfied with the value they receive from their apartment relative to the amount they pay. This is well above other cities’ rates and almost 9.0% above the national average of 54.7%. Unlike most of the large metropolitan areas, Atlanta was deemed as one of the most affordable cities to live in, with residents spending on average only 23% of their monthly income on housing. Other cities, such as New York and Miami, are much less affordabledcbyyywavxufbwvxweyatutby, with residents spending as much as 58% and 54% of their paychecks on rent.
Along with affordable rents, Atlanta also expects to add 14,200 new apartment units before the end of the year, which will lift the pace of supply well above the growing demand. An excess of supply will lead to fierce competition between landlords to attract and retain residents, creating little leverage to push rents, which will result in the stabilization of rental rates and generous concessions to lure residents to their communities.
Location Influential to Renters Renewing
While rental rate and location remain the top factors influencing residents’ decision to renew, rental rate is dropping in significance and location is becoming more important. Last year, the difference between residents indicating rental rate as a factor compared to location was 3.3%. This quarter, there is only a 0.2% variance between the two factors, with 54.2% of residents designating rental rate as a reason and 54.0% of residents selecting location as a factor. Among residents likely to renew, location has increased in significance by 2.0% over the last year, with 74.2% of residents indicating it influences their decision to stay. However, residents unsure or unlikely to renew are becoming less swayed by location and reported 2.1% drops in the impact location has on their renewal decisions. While location still significantly affects a resident’s decision to renew, residents unlikely to renew attribute their decision primarily to the rental rate, which is a factor that each community can control to persuade those residents to stay.
How Prospective Residents Discover their New Home
With an abundance of options to choose from when it comes to picking out a new home, prospective residents must narrow down communities that pique their interest before deciding which ones to visit. Renters take various approaches to discover a community that fits their needs. 35.3% of renters find or hear about a community through internet listings and advertisements, while 31.0% of renters simply decide to visit a community after driving or walking by. While these two approaches are the most common, 16.7% of renters indicate that they utilize personal referrals to find a new community to call home.
Internet-enabled devices also help prospects research communities prior to making their final rental decision. 38.9% of renters indicate that they used a laptop while searching for an apartment. Following close behind, 33.1% of renters opted to use a mobile phone in their apartment search. Internet-enabled devices allow residents to engage with numerous online resources to learn more about the communities they have interest in. The top three online resources include Google, community and company websites, and Apartments.com. While Google has seen minimal fluctuation in the number of residents utilizing the resource, the popularity of community and company websites decreased by 3.8% over the last year. Third-party sites such as Apartments.com, Zillow, and ApartmentFinder.com increased in popularity by 3.2%, 7.2%, and 3.1%, respectively. These changes over the last year have proven that third-party sites can be just as essential as community and company websites in the apartment search process.