While the real estate market is stagnant due to high interest rates and low demand for apartments, a construction boom in the U.S. is providing renters with better opportunities to find affordable housing as landlords lower rents and offer perks to reduce vacancy.
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This is due to the record number of multifamily homes built since the pandemic. According to the Zillow Group, more multifamily homes were built in June than in any other month in the last 50 years.
To rent units in a competitive market, landlords offer perks such as free or reduced rent, free parking, and other incentives.
According to Zillow, 33.2% of landlords granted at least one rent reduction last month, which is over 25% more than last year.
According to a report from Redfin, the median rent for one- to three-bedroom apartments has fallen for the first time in four years.
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Greater Orlando Area
Because of the large number of new construction projects, especially in suburbs and smaller cities 30 to 45 minutes outside of Orlando, there are some attractive incentives being offered to potential renters, says Blake Blahut, Broker Associate & Realtor at Realty ONE Group.
“Overall, the fast-growing areas just outside of Orlando are experiencing the biggest ‘slowdown’ in the rental market, as not only are there many brand new apartment buildings being built there, but there are also many brand new homes for sale.”
In the Orlando area, many of these homes are being purchased by investors and immediately rented out, Blahut said. Blahut cites these as cities in Central Florida that offer great deals to renters.
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Horizon West
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Clermont
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Holy Cloud
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Davenport
“I have seen offers for renting apartments and terraced houses that were as attractive as ‘first month free’. This essentially gives tenants two months rent free if they meet the requirements.” Blahut said he has been observing this tactic for a year and a half.
“I’ve also heard from potential customers about offers where they can get up to two months free if they renew for a second year!”
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South Florida
In South Florida, where rents have historically been very high, there are some affordable neighborhoods where landlords are offering great deals on rental apartments.
“With the current construction boom, people looking to rent in warm states from Florida to Texas now have a little more flexibility,” said Omer Reiner, licensed real estate agent, entrepreneur and president of FL Cash Home Buyers, LLC.
Renier said rents are falling as more apartment buildings are springing up at a rapid pace. “However, rents in many of the ‘hot’ cities like Palm Beach, Miami and others are still higher than in most other U.S. cities.”
Wilmington, North Carolina
One area that has seen rent declines due to increased construction activity over the past year is Wilmington, North Carolina, said Seamus Nally, CEO of TurboTenant.
“A lot of new homes have been and continue to be built in the area, which has caused average rents in Wilmington to drop over the past year.” Nally said rents are rising in most places in the U.S., so Wilmington is “definitely worth a look.”
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This article originally appeared on GOBankingRates.com: 3 Affordable Places Where Renters Are Thriving Due to a Construction Boom
