What will demand look like for Salt Lake City Rental Property Owners in 2015?
Salt Lake City rental property demand projections for 2015.
While predicting the future can be a humbling experience, the experts at real estate investment firm Marcus and Millichap are always willing to give it a shot. They recently released their 2015 outlook for the Salt Lake City multi-family rental market and have good news for Salt Lake City rental property owners. Here are their forecasts for several key metrics:
Rental Rates: According to their analysts, “Following a 3.0 percent rise last year owners will lift rents an additional 2.8 percent in 2015 to $892 per month.” This is music to the ears of Salt Lake City rental property owners. 2014 was a great year to own rental property, and if their projections hold true, 2015 should be similar and owners can expect even more rent increases.
Vacancy: Their experts said, “Supply will edge out demand this year, pushing up vacancy 40 basis points to 4.4 percent. In 2014 vacancy fell 70 basis points.” Salt Lake City rental property owners enjoyed near record low vacancy rates in 2014 as strong job growth brought many new residents to Salt Lake. However they estimate that while rates will remain low, owners can expect an uptick in vacancy due to excess supply. Approximately 2,700 new rentals came online in 2014 and they project another 2,500 in 2015.
Employment: Their report predicts, “Payrolls will expand by 30,000 positions this year, a 2.7 percent increase. Last year, 28,000 jobs were created.” This might be the best news yet for Salt Lake City rental property owners as a strong job market is one of the best economic indicators for a stable rental market. Even more importantly, they project “The population of 20- to 34-year-olds, the primary renting cohort, is anticipated to increase 1.6 percent by year end, four times the national average.”
In conclusion, their report indicates that 2015 will likely be another great year to own rental properties in Salt Lake City. In fact, Salt Lake ranked 21 nationally on the NAI index for 2014, and will remain one spot outside of the top-20 in 2015. This means that their experts predict there are only a handful of “better” markets in which to own rental property than Salt Lake City.
If you’d like to learn more about the Salt Lake City rental market, then contact us today.