NASHVILLE, Tenn. (WKRN) - According to Zillow, rent concessions, which are move-in specials and other incentives for new renters, are becoming more common across the country.
A rise in concessions can signal a slowing rental market.
But in Nashville, we're told the price of rent is still a little higher than the national level, which shows our rental market is not slowing by much and that means fewer discounts for renters.
Annual rent growth is slowing nationwide, partly because of increased construction and slower demand.
"We've seen particularly young adults go out in mass and buy their first homes in the past two years and that has softened rental demand a little bit, but I think it has more to do with supply. We've seen an enormous amount of construction over the past couple of years, particularly in the multi-family apartment sector. And often where you see concessions is on new apartments that are trying to build up, to fill those newly opened units,” said Aaron Terrazas, Zillow Economic Research Director.
Experts told News 2 that the number of rental listings that mention a concession has decreased by 27.7% in Nashville over the past year. Renters can expect to find a concession mentioned in 1% of listings.
But because of new jobs with companies like Amazon just announced, it's expected there will be plenty of people to fill the vacancies, with or without incentives.
"Certainly, any big jobs boom in that community kind of does tend to push up rental demand and in the near-term people who move to the area for these jobs tend to immediately rent a place I'm sure you'll see a little of a rental surge six months, maybe a year after they move," said Terrazas.
The median rent in Nashville is currently $1,500 per month.
Terrazas said, "It's not clear that that's going to continue into 2019. You think about the dynamics and the for-sale market with rising interest rates it may be a little more difficult for buyers in 2019. If it's more difficult for them to buy, they may decide to rent a little bit longer, pushing up rental demand."
And that could mean higher prices, and that the trend of fewer incentives for renters in Nashville would continue.
Rental listings mentioning concessions have more than doubled over the past year in cities like Chicago, Miami, and Atlanta. Concessions are the most common in Milwaukee and Portland, where renters can expect to see a move-in special advertised in about one in 50 listings.
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