Misty has a very nice piece in the Tribune about Phoenix rent trends. It’s short and packed with information.
The Valley’s average apartment rent hit a record high of $768 in the second quarter 2007, up from $693 two years ago
That’s a huge increase in two years. When home prices skyrocketed, many had to rent versus buy.
From the second quarter 2002 to the same period in 2004, rents inched up 0.15 percent, TeKampe said. During that same time from 2005 to 2007, rents jumped 10.8 percent. This year, growth is expected to slow to 2.5 or 3 percent, he said.
Then the supply increased. Many frustrated home sellers converted their “For Sale” signs to “For Rent” signs. Many apartments converted into condos were turned back into apartments because of poor sales. (At least the apartments are a lot nicer now.)
A house worth $225,000 with 10 percent down would have a mortgage payment of around $1,600, while leasing it out might only bring in $1,100
Many small investors have, unfortunately, become very familiar with those figures.