Rising Rents? NMHC Says Blame Short Supply
The National Multifamily Housing Council says “Econ 101” is the real reason rental rates have been rising in recent months and not price gouging, as many have been quick to say. Their data show that double-digit rent growth recorded in late 2021 & early 2022 coincided with record low apartment vacancy rates (i.e., the number of empty and available apartments) – in other words there are too many people competing for not enough apartments, which drives prices up. They say the U.S. needs to build 4.3 million apartment homes by 2035 to meet both future demand and an existing shortfall of 600k units and the apartment industry stands ready to help meet the rising need for accessibly priced rental housing, but they cannot do it alone. Indeed..
“Much has been made about rising rents in recent months, often with the implication that they are the result of price gouging. In fact, the explanation is much simpler. It’s simple Econ 101—the U.S. does not have enough housing to meet demand.”
“To ensure that supply is built, however, we need to avoid the lure of “quick fixes” like eviction moratoriums and rent control. They do nothing to address the underlying supply shortage. More importantly, they eventually harm the very people they are trying to help by discouraging new housing construction and limiting the financial resources owners have to maintain existing housing.”