Minnesota’s Red-Hot Rental Market
The housing market in twin cities certainly seems to be heading in the right direction. The number of new buyers hitting the market is on the rise. And the corresponding increase in demand, combined with a dwindling supply of inventory, has helped boost the area’s median sales price of single family homes to roughly 6.5% over the last year.
There has also been a spike in the number of new apartment buildings going up around town. In 2014, the metro area saw an increase of nearly 5,000 new units added to the apartment market. The forecast for 2015 predicts that we’ll likely see another 2,000 – 3,000 before it’s all said and done.
Yet despite these two key economic factors, the twin cities rental market remains red hot, with no signs of slowing down anytime soon. This may seem contradictory to the previously cited statistics. But the demand for rentals continues to climb. In fact, even with the increase in supply, the overall vacancy rate for the twin cities is right around 5.6%. The apartment sector alone is even more impressive, boasting a ridiculously low rate of roughly 2.5%.
As it is with most economic upturns, job growth is the key cog for fueling the rental demand. The Minnesota market was one of the least affected areas following the nation’s recession of recent years. And a steady job growth rate since then has helped the local economy to bounce back nicely. While the national unemployment rate sits right around 5.5%, Minnesota is sitting pretty with a rate of 3.7% – the lowest it’s been in 13 years.
And as the job growth rate continues to steadily grow, so too does the state’s population. New jobs attract more people, which in turn drives the demand for housing. So as long as these trends keep trending upward, the Minnesota rental market will remain rock solid.
Call the trusted source for Sales, Leasing and Property Management in the twin cities. Please contact Tradewind Properties today for a FREE consultation and home rental or sales analysis.