After years of record rent increases across the country, a national real estate tracking firm predicts they will slow down in 2016 but Portland increases will still be among the nation's highest.
"Hot markets are still going to be hot in 2016, but rents won't rise as quickly as they have been," says Dr. Svenja Gudell, chief economist for Zillow, which tracks rents and home prices across the country. "The slowdown in rental appreciation will provide some relief for renters who've been seeing their rents rise dramatically every single year for the past few years."
According to a report released by Zillow on Friday, rent increases will level off over the next 12 months, slowing to an annual rate of 1.1 percent by the end of the year.
Rents in Portland are predicted to increase by 3.8 percent in 2016, however, which is the 6th highest in the country. But that is much better than 2015, when they increased by 9.7 percent over the previous year.
"The slowdown in rental appreciation indicates that supply of new multi-family homes is catching up to demand. Substantial new housing supply is becoming available in Atlanta, Denver, Portland, Seattle, and other markets," reads the report.
At the same time, rents in Portland and other hot markets will remain at record levels, pricing many people out. According to Zillow, the average rent in the Portland area was $1,689 a month in December and is expected to increase to $1,753 by the end of the year. Both figures are more than $300 a month over the national average.
Partly in response, the City Council and Multnomah County Commission have declared housing states of emergency and are promising to increase the supply of affordable housing.
"The situation remains tough on the ground: rents are still rising and renters are struggling to keep up," says Gudell.
The top 10 forecast metropolitan increases are as follows:
1) San Jose, Calif. – 7.8%
2) Buffalo, N.Y. – 7.4%
3) San Francisco, Calif. – 5.9%
4) Seattle, Wash. – 4.5%
5) Denver, Colo. – 4%
6) Portland, Ore. – 3.8%
7) Miami-Fort Lauderdale, Flo. – 3.5%
8) Austin, Tex. & Sacramento, Calif. – 3.4%
9) Louisville-Jefferson County, Kent. – 3.2%
10) Los Angeles-Long Beach-Anaheim, Calif. – 2.8%
You can read the report at zillow.mediaroom.com/index.php?s=28775&item=137208.