Emerging Market Analysis 6 (Rental Rates affect on Market analysis)
So here is how Pending Home Sales plays a very important role. Rental Rates Up / Sale prices up: This is often one of the most ignored and yet the easiest analysis to identify weather a market is rising or falling. As you track a particular market you will first see rental vacancy diminish and the rental rates will start to rise. As the rents rise the opportunities for the tenants to trade those rent payments in for home payments become more appealing. Additionally as fewer rentals are available home ownership becomes a great alternative.
RENTOMETER: Here is a great tool I use daily. It is a tool that covers the entire country helping landlords and tenants determine fair market rents any where in the country. Simply type your info (address, bedroom count and your desired rent) and it will give you average rent for your area and also a bunch of comparable rents. additionally you can advertise your property for rent here has well. You can view this tool Here on the front page of my website. Go ahead and play around with it as it is pretty cool tool to have. O.K. enough show and tell.
50 year statistics: When you look at the past 50 years you we see that nationally rental rates has rose along side home values at a rate of about 6% per year for both rent increases as well as home appreciation. Rental rates will be the first to be noticed as a market swings from a poor market to a good market so keep an eye on what rentals are doing and rent ometer is a great tool as well as watching the classified ads and checking with you local realtors.