Apartment rents in San Diego are forecast to rise 4.7 percent in 2017, a increase that will be among the top ten nationwide.
The online real estate service Zillow reported Friday that metropolitan areas in the West will continue to see the biggest increases in rents as job opportunities attract Millennials and new construction fails to keep pace.
Seattle leads the forecast with a 7.2 percent projected increase, but even San Diego’s 4.7 percent rise will be three times the national average of 1.7 percent, according to Zillow.
“High rent growth in these markets is being driven by high demand and low supply,” said Zillow Chief Economist Dr. Svenja Gudell. “We have more renters today than in the past and most newly formed households are renter households.”
“This taken together with a lack of new rental construction at less expensive price points has been a recipe for rising rents,” she explained.
Here are the 10 metro areas with the highest forecast increase in rents next year:
- Seattle – 7.2 percent
- Portland – 6.0 percent
- Denver – 5.9 percent
- Cincinnati – 5.2 percent
- San Francisco – 4.9 percent
- Los Angeles – 4.8 percent
- Sacramento – 4.7 percent
- San Diego – 4.7 percent
- Phoenix – 4.6 percent
- San Jose – 4.5 percent
Gudell said there is some good news on the horizon for renters in the West.
“Instead of the 10 percent rental appreciation we’ve been seeing in some places, expect growth more along the lines of 4 to 7 percent,” she said. “This is still high, but will hopefully give renters some relief.”