WASHINGTON (MarketWatch) — Inflation in January may have seen the first negative reading since 2009, but there’s little sign that rents are cooling off.
Rent of primary residences, on a year-over-year basis, stayed at 3.4% in January, the 10th month in a row it’s been above 3%, according to Labor Department data released Thursday.
Put another way — the gap between rents and the broader consumer-price index is as large as it’s been since August 2009.
Separate data from Axiometrics confirms the story on rents — apartment rent growth in January was 4.9% year-over-year, which according to their data was the best since the recession.
The rental story has been a hot one for some time.
Part of it reflects the same fundamentals that have helped lift house prices, like the steady jobs growth in the economy.
In addition, tight credit standards, and the overhang of student debt, have helped steer younger Americans to rent from buy, when they’re not living in their parents’ basements.
Other factors include changing tastes as well as lifestyle changes, like marriage, happening later in life, according to KC Sanjay, senior real estate economist at Axiometrics