Housing Market Shifts Back In Landlords' Favor Given Historically High Demand

Housing units are being snatched up at a historic pace, with nearly three-quarters of units leased within three months of being completed, according to Bloomberg.

Last year saw 1.6 million units under construction, the most in 15 years, with December, in particular, seeing a steep surge. Those were largely multifamily groundbreakings, according to a Joint Center for Housing Studies of Harvard University's report cited by Bloomberg.

Renters fleeing high-cost cities for more affordable cities is driving up costs, especially in cities like Atlanta and Detroit, which saw rapidly rising rent. With eviction bans ending and rents rising, landlords are gaining back bargaining power they lost in 2020, Bloomberg states.

“We’ve never seen as much demand as we saw in 2021, and now we have a severe lack of availability and low vacancy in all types of housing as well, and that’s really driving the rent inflation that we’re seeing,” Jay Parsons, the head of economics at RealPage, told Bloomberg.

Rising incomes may help some of those facing higher rents, with hourly wages for production and workers not in management roles up 5.8% last year.

However, the expiration of eviction bans is hitting lower-income renters hard, with those in the Sun Belt and Mountain metros most prone to possible displacement, Princeton University Eviction Lab Project Director Carl Gershenson told Bloomberg. Those same areas are seeing intense construction activity as of the fourth quarter of 2021, according to the National Association of Realtors. Metros in Florida, South Carolina, Alabama and Tennessee, especially, are seeing some of the highest housing construction in the country.

Florida has eight of the top 20 metros with intense apartment construction, according to NAR, and is also seeing a massive influx of people moving to the state.

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