Job growth, a low home-ownership rate and continued tight supply of apartments will continue to push rents higher in metro Atlanta, though thousands of new units coming to market over the next year might mute the rate of growth, forecasters said at an apartment industry meeting Friday.
Metro Atlanta’s recent pace of job growth — 77,000 in the 12 months ended in June — has contributed to the number of people looking for places to live. Demographic trends also skew to renting as younger adults delay marriage, starting families and buying homes.
“(Millennials’) life stage decisions make them more prone to renting,” Ryan Davis, a senior economist with Witten and Associates, said at the Atlanta Apartment Association Apartment Market Outlook breakfast.
Rents in metro Atlanta grew at an annual rate of 7.3 percent in June, the same rate as the June a year earlier, according to data firm Axiometrics. The average two-bedroom unit rented for $1,020, while occupancy stood at 94.7 percent, the report said.
Rising housing costs, stagnant wages, student debt and other factors have stymied the rebound in home sales. Mortgage standards remain tight and many young adults’ ability to buy has been kneecapped by debt, a lack of savings and trouble finding career traction.
Also, many younger adults and boomers have become renters of choice, choosing to rent rather than buy to live in walkable communities that they might not be able to afford as a purchaser.
The “torrid” pace of rent growth in metro Atlanta will moderate a bit, Davis said, as more units under construction enter the market and developments compete for renters.
The region should see about 9,000 new units enter the market this year, a figure that could grow to 11,000, but those figures are still several thousand units a year shy of the region’s peak in the early 2000s, Davis said.